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-/-L ~T / THE BUSINESS BFVIFW n~ °Cf & FEDERAL RESERVE BitNJv OF PHILADELPHIA OCTOBER 1, 1941 o- %■/n & Trade and industrial activity in the Third Fed of operation. The output of mines has expanded, eral Reserve District has risen further from the in spite of active operations in the summer. Pro high levels prevailing in earlier months. Oper duction of crude oil and electric power has in ating rates are increasing to new records in many creased. lines. The movement of goods to producers and Employment and payrolls increased in August consumers is the heaviest in several years. The except in some trade and service industries. Manu facturing showed greater activity, and further gains demand for credit continues to expand. were reported in September at plants producing Tendencies toward price advances are increas heavy goods. Hourly earnings have advanced to a ingly evident, and efforts to curb these influences new high level and weekly earnings approximate are being made in a greater variety and upon a the record reached last June. Incomes are substan broader scale. Price limitations are being extended tially above a year ago. to more lines of goods. Priorities schedules are As a further step in combating inflationary devel being adjusted to requirements for generally opments, the Board of Governors of the Federal heavier production. Reserve System on September 23, 1941 increased Industrial operations are still expanding, but the reserve requirements of member banks to the limit rate of increase has slackened as many lines are of its statutory power. This increase becomes effec at or near capacity. Heavy production schedules tive on November 1, 1941, and will amount to have necessitated frequent shutdowns for repairs, about one-seventh. In spite of this action, the sup and supplies of labor and materials are increas ply of funds will still be large to meet the defense ingly scarce in the light of current needs. Stocks needs for bank credit and all legitimate require of finished goods have been reduced substantially, ments of business. The direct effect upon bank and supplies of raw materials, while still larger operations will be negligible, as reserves in the aggregate are about twice requirements and large than a year ago, are being drawn upon heavily. balances are carried with correspondents. Bank Defense requirements are expanding month by reserves in this District reached a record high in month, and expenditures are reaching new highs. September. Civilian buying in wholesale channels is heavy in Commercial loans continued to expand, showing those lines where goods are available. Retail buy an increase of nearly two-thirds since the war ing in August was at a record level for the season, started. Investments in Government securities have and the volume of sales has continued heavy in also expanded. Trading in the security markets September. has been light and price fluctuations for the most Manufacturing activity has increased in most part narrow. Quotations on corporate securities major lines although in many cases the gains were generally have weakened somewhat since early smaller than seasonal, owing to earlier high rates September. Page One PRODUCTION AND PRICES HOURLY EARNINGS AND WORKING TIME PERCENT PENNSYLVANIA FACTORIES HOURS CENTS INDUSTRIAL PRODUCTION (PHILA. rCD. RES. DIST.) WHOLESALE COMMODITY PRICES AVERAGE HOURLY EARNINGS PRICES OF RAW MATERIALS HOURS WORKED 1936 193 7 1938 1939 1940 194 I Manufacturing. The demand for goods manu factured in this District is increasing further with expanding defense requirements and heavy civilian buying. Orders already placed call for a larger volume of goods than can be shipped over the next several months, and because of increasing difficul ties in getting delivery purchases by the regular trade are tapering off. Trading interest is still keen whenever goods are available within a reasonable time. Prices generally continue to advance. 1936 1937 1938 1939 940 sharp increases occurred at plants making primary iron and steel, brass and bronze products, elec trical apparatus, engines and pumps, and trans portation equipment. In the case of nondurable goods, employment has risen about 9 per cent and wage disbursements 20 per cent in the past year. Earnings of factory workers in Pennsylvania in creased slightly in August to a new high average of nearly 81% cents an hour, as against 72% cents a year ago and 57-% cents in 1929. Working Operations are at high levels in nearly all indus time also increased in the month from an average tries, the principal exceptions being at silk fabric of 40 to 41 hours a week, and average weekly and hosiery mills, where supplies of substitute income advanced 81 cents to $33.07, or nearly yarns have been insufficient to sustain production $6.00 a week more than at this time last year. at recent high rates. Inventories of finished prod In Delaware factories employment and payrolls ucts have declined further in both durable and con sumers’ goods industries. Stocks of raw materials showed gains from July to August of 4 and 5 per are substantially larger than a year ago at most cent respectively. The number employed in south plants, but they are being drawn upon heavily and ern New Jersey increased 11 per cent and the vol ume of wage disbursements 13 per cent. it is increasingly difficult to replenish supplies. Factory employment in Pennsylvania continues to expand. In August the number of workers in creased about 1 per cent to a new peak of nearly 1,150,000, and further gains were reported in the heavy industries in September. Wage disburse ments advanced 4 per cent in August to nearly $35,000,000 a week. Payrolls expanded in all the principal lines of manufacturing except leather and paper and printing, where there was virtually no change in the month. Employment and payrolls respectively were 23 and 48 per cent above a year ago and 33 and 76 per cent above August 1939. The greatest gains have been in heavy goods in dustries, where employment was 32 per cent and payrolls 64 per cent above a year ago. Particularly Page Two The output of manufactured products in this District increased in August, owing chiefly to ex pansion in the metal products and transportation equipment industries. On a seasonally adjusted basis, production in the past two months has been the highest on record. Operations in August were 32 per cent above a year ago, reflecting principally sharp gains in such durable goods lines as motor vehicles, shipbuilding, electrical apparatus, and primary iron and steel. Expansion over the twelve months in the output of consumers’ goods in gen eral has been less pronounced than in the heavy industries, although in certain lines, such as cotton and wool textiles, leather, and canning, sharp gains were reported. The production of electric power increased some- ACTIVITY IN THE STEEL INDUSTRY TEXTILE ACTIVITY EMPLOYEE-HOURS IN PENNSYLVANIA EMPLOYEE -HOURS IN PENNSYLVANIA PERCENT PERCENT COTTON ' GOODS FOUNDRIES STEEL WORKS AND - ROLLING MILLS >''*V MACHINERY WOOLENS AND WORSTEDS AND PARTS 1936 1937 1938 1939 1940 1941 what in August and was considerably larger than in the late summer of 1940. Total sales and sales to industry were respectively 21 and 31 per cent greater than a year ago. Coal and other fuels. Sales of fuels have been well sustained. The demand for bituminous coal continues heavy, reflecting the high rate of con sumption by manufacturing plants and railroads. Purchases of anthracite remain substantial, al though buying was unusually active during the summer months. Prices of hard coal have increased. Production of Pennsylvania anthracite increased from 180,000 tons a day in July to 202,000 tons in August, when activity usually declines. Output was the largest for the month since 1930, but operations slackened somewhat in September owing to stoppages in some areas. The volume mined during the first eight months of 1941 was 5 per cent larger than a year ago. Operations at bituminous mines declined contraseasonally in August. Output was reduced from 461,000 tons a day in July to 440,000 tons, but was still the largest for any August since 1929. The volume produced thus far this year has amounted to more than 77,000,000 tons, the largest in eleven years. 1937 1938 1939 1940 1941 1942 and other facilities to meet the expanding needs of the defense program continue sharply above a year ago. Residential construction is also active, par ticularly in the erection of low-cost housing units in defense production areas. Prices of building materials have increased further and are now 18 per cent above the pre-war level. Awards of new contracts declined 48 per cent in August to $26,437,000 but were the largest for the month since 1928. This decrease was caused largely by a decline in factory awards which in July included a contract for the erection of a drydock. Substantial reductions were also reported in the case of commercial and miscellaneous struc tures and public works and utilities. The only in crease in the month was a slight expansion to a new twelve-year peak in contracts for houses. Com pared with a year ago the most pronounced in creases were in awards for residences and indus trial structures. In the first eight months of this year awards were 53 per cent greater than in 1940. Agriculture. Markets for farm products in this District have improved further, reflecting the ex panding incomes of workers in defense and other industries. The shortage of labor has grown more acute with the approach of the principal harvest season, particularly in the vicinity of the larger Production of by-product coke in July and Au industrial centers. Wage rates for agricultural gust was the largest on record, and for the year to workers are advancing and have partly offset in date has increased 11 per cent over 1940. creases in farm cash income resulting from rising prices for crops and livestock products. Building. Construction in this District continued exceptionally active in August, although awards of Growing conditions for late crops were unsatis new contracts declined substantially from the un factory after the middle of September, because of usually high level reached in July. Operations insufficient moisture. Harvesting operations, how against existing contracts for manufacturing plants ever, were facilitated by the unusually large num- Page Three BUILDING CONTRACTS MILLIONS DISTRIBUTION PHILADELPHIA FEDERAL RESERVE DISTRICT 1--------flRST HIGH RESIDENTIAL (■ m N ON- RESI DEN TIAL 27 '28 ’29 11 '30 '31 M M B, PHILADELPHIA FEDERAL RESERVE DISTRICT MON THS n 1 11 1 MRS! CIGH 1 PERCENT RETAIL TRADE SALES MON TMS '32 '33 ’34 '35 '36 '37 '38 '39 '40 i i '41 ber of clear days throughout the month. Production of tobacco and oats this season will be larger than in 1940, and above the five-year average, but de clines are expected in several other leading field crops, including wheat, hay, and white potatoes. Wholesale prices of farm products increased nearly 6 per cent further in the month ended the middle of September to a level 37 per cent above a year ago, and 50 per cent above August 1939, according to the United States Bureau of Labor Statistics. Farm cash income in Pennsylvania, New Jersey, and Delaware through July totaled $256, 773,000, or 14 per cent more than in the first seven months of 1940. -TOTAL FREIGHT CAR LOADINGS 1938 1939 1940 1941 1942 ticipatory buying, stimulated by the reports of growing scarcities in some lines of civilian supply. Sales sharply exceeded seasonal expectations in all reporting lines; on an adjusted basis increases ranged from 18 per cent at department stores to 51 per cent at shoe stores. Sales at credit stores handling durable con sumers’ goods in August were about one-half again as large as a year ago. Gains in the year at depart ment, men’s apparel, and shoe stores exceeded 30 per cent, and the increase at women’s specialty shops was only slightly less. In the first eight months, the greatest improvement over 1940 was at department, credit, and shoe stores. The value of farm land in this District has Distribution at wholesale increased moderately increased considerably in recent years, owing from July to August, reflecting sharp seasonal to expanding markets and rising prices for agri gains in the sales of shoes and jewelry and sub cultural commodities. General economic uncertain stantial increases in sales of dry goods and hard ties have stimulated interest in land ownership, but ware. The aggregate volume of wholesale business there has been little, if any, speculative buying. was 50 per cent larger than a year ago, owing Trade. The movement of goods through trade partly to higher price levels. Increases were re channels in this District has been substantially ported in all lines, especially electrical supplies, heavier than a year ago and in some lines has dry goods, hardware, and paper. The smallest ex reached record levels. Retail sales expanded un pansion over 1940 was 12 per cent in drugs. Stocks usually sharply in August and were the largest declined slightly in the month and showed a much for the season in records back to 1923. Further smaller increase over a year ago than did sales. seasonal increases occurred in September, al The movement of rail freight in this section in though the gain over a year ago was less marked August was the heaviest for any month since 1929. than in previous months. A high rate of activity There was little change from July in shipments of also prevails in wholesale lines, where spot demand merchandise and miscellaneous materials; loadings is large and forward purchases are limited chiefly by inability to assure delivery within reasonable of ore and forest products were heavier than was to be seasonally expected; while the movement of periods. Rail freight traffic continues heavy. grain declined considerably. Sharp gains over a The exceptionally active turnover of goods at year ago were reported in most classifications, with retail establishments in August continued to reflect increases exceeding 20 per cent in carload ship greatly expanded consumer incomes and appar ments of merchandise and miscellaneous freight, ently was due partly to a certain amount of an coke, coal, and forest products. Page Four DEPOSITS AT MEMBER BANKS COMMERCIAL LOANS PHILA. FED. RES. DISTRICT REPORTING MEMBER BANKS MILLIONS PHILADELPHIA FEDERAL RESERVE DISTRICT MILLIONS 1600 1600 COUNTRY BANKS 1940 1400 PHILADELPHIA BANKS 1200 1939 JAN. FEB. MAR APR. MAY JUNE JULY AUG SEPT OCT. NOV. DEC Banking conditions. Loans and investments of the reporting banks have increased moderately in the past month, chiefly through the extension of additional credit to business concerns and pur chases of Government securities. As a result of this expansion in bank credit and funds gained in interdistrict transactions, deposits advanced to record high levels. By action of the Board of Governors of the Fed eral Reserve System reserve requirements against deposits will rise to the legal maxima on November 1. Requirements in general will be increased by about one-seventh over those now in effect. This change will have virtually no effect upon the vol ume of earning assets held by banks as reserves total more than twice current requirements and in addition large amounts of readily available funds are being carried with correspondent institutions. Reserves increased to an all-time peak of $807, 400,000 on September 20 and at the slightly re duced level of $804,100,000 on the 24th showed a net gain of $16,600,000 over a period of five weeks. The District gained $84,000,000 in inter district transactions; a substantial part of this reflected transfers from other areas for the pur chase of tax anticipation notes or the collection of income tax checks deposited here and payable else where. Funds made available through payments from miscellaneous deposits at the Federal Reserve Bank are also believed to have gone largely into the Treasury’s balance. Treasury disbursements for defense, interest on debt, and other purposes were large in the aggregate, but fell short of receipts by $62,000,000. Among the receipts were very sub stantial amounts in payment of income taxes and purchases of tax and savings securities. Currency 1937 1939 1940 demand continued active, considerably exceeding the amount called for a year ago, and was a further factor tending to limit the increase in reserve bal ances. Outstanding credit of the reporting banks in creased $11,000,000 in the five weeks ended Sep tember 24 to $1,348,000,000. The largest change was an increase of $7,000,000 in commercial loans to a new peak of $306,000,000. These loans have expanded by about one-third in the past year in response to the increased working capital needs of trade and manufacturing establishments, reflecting higher material and wage costs and larger inven tories, and over the entire war period have shown an increase of 64 per cent. Small increases also were reported in other types of loans. Holdings of direct obligations of the Federal Government were increased $6,000,000, chiefly through pur chases of Treasury notes. The only material reduc tion in any class of loans and investments was a decline of $4,000,000 in holdings of corporate and municipal securities. At the record level of $2,046,000,000 late in September deposits at the reporting banks show an increase of 16 per cent over a year ago. Expansion of $28,000,000 in the past five weeks has been principally in funds carried for individuals and business concerns and in balances held for other domestic banks. A moderate reduction was shown in state and municipal deposits. The growth of $281,000,000 in deposits over the past twelve months was nearly twice as large as the expansion in loans and investments. Bal ances carried with the Federal Reserve Bank are much heavier than a year ago. Page Five BUSINESS STATISTICS Production Employment and Income Philadelphia Federal Reserve District in Pennsylvania Adjusted for seasonal variation Industry, Trade and Service Not adjusted Per cent c lange Indexes: 1923-5=100 Aug. July 1941 1941 Mo. ago INDUSTRIAL PRODUCTION 119p 119 90 MANUFACTURING............... 117p 118 88 Durable goods........................ 146p 148 93r Consumers’ goods............... 97p 97 85 Metal products.................... 140 147 96 Textile products.................. 90p 90 76 Transportation equipment 254 234 121 Lood products..................... 92p 91 83 Tobacco and products... . 111 108 104 Building materials.............. 53 54 42 Chemicals and products. . 150p 154 131 Leather and products.... 132p 151 107 Paper and printing............. 92 92 87 Individual lines Pig Iron................................... 118 113 94 Steel.......................................... 122 132 r 93 Iron castings......................... 102 91 72 Steel castings........................ 189 199 113 Electrical apparatus.......... 181 188 r 103 Motor vehicles..................... 62 51 24 Auto’bile parts and bodies. 121 117 87 Locomotives and cars.... 73 74 35 Shipbuilding.......................... 1358 1246 r 581 Silk manufacturers............. 89 86 75 Woolen and worsteds.... 76 78 r 55 Cotton products.................. 61 65 43 Carpets and rugs................ 113 107 97 Hosiery.................................... 106 115 104 Underwear............................. 173 188 r 138 Cement.................................... 72 78 63 Brick........................................ 70 73 r 47 Lumber and products.... 32 30 27 r Slaughtering, meat pack.. 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............................ crudu on.......... ELEC. POWER—OUTPUT . Sales, total............................. Sales to industries............... BUILDING CONTRACTS TOTAL AWARDSt.................. Residential f.......................... Nonresidentialf................... Public works and utilitiesf Employment Aug. 1941 from Aug. 1940 0 1 2 1 5 0 + 8 + 1 + 3 - 3 - 2 -13 0 - 1941 from Aug. 1941 8 Yeai mos. ago 1940 +32 +32 +57 +13 +47 +18 + 10! + 11 + 7 +25 + 15 +23 + 6 +25 +28 +50 + 12 +47 +19 +87 + 7 + 5 +33 + 12 + 18 + 2 July 1941 Aug. 1940 117p 113 117p 114 147 85p 246 88p 119 60 151p 134p 90 89 89 142r 83 228 86 116 59 151 137 90r 99 72 117 83 111 48 131 110 84 + 4 +26 - 7 + 31 +12 +42 - 5 +67 - 4 +76 +22 + 153 + 3 +39 - 2 + 108 + 9 +134 + 3 +18 - 2 +38 - 6 +40 + 5 + 17 - 8 + 2 - 8 +26 - 8 +14 - 4 +49 + 6 + 17 +23 104 104 82 +35 124 120r 95 +32 99 87 69 +73 181 177 109 +67 200 197 r 114 +135 52 52 21 +54 113 112 82 +71 74 74 35 +98 1345 1209 575 +22 86 85 73 +38 78 73 56 +26 55 56 39 +10 105 99 89 + 8 92 94 90 +12 161 156 128 +29 90 91 79 +56 73 70 r 49 +13 34 33 30 r 101 ... 4 108p 111 89 93 146 119p 178 101 170p 152 102 103p 98 419 349 350 252 95 ... 4 107 107 91 r 93 r 167 135 181 110 172 152 90 r 87 llOr 415 353 342 239 115 51 72 103 81 88 130 86 126 83 159 143r 74 r 73 r 82 413 294 290 193 + « -12 - 5 86 + 1 + 4 - 3 0 -13 -13 - 1 - 8 - 1 0 +14 + 18 -11 + 1 - 1 + 2 + 6 +50 + 8 + 9 + 6 + 13 +38 +42 +22 + 7 + 7 +39 +41 +20 + 1 +18 +21 +31 +24 + 4 + 6 + 2 +21 + 12 +57 +14 + 2 +11 + 8 + 5 + 8 - 6 +16 + 17 +25 | 97p 119 89 90 156 114p 178 103 172p 149 78 76p 92 419 331 332 260 155 91 224 183 156 85 212 186 90 49 104 187 + + - +71 +83 +115 - 2 +51 150 +42 102 + 119 206 -13 159 1 6 6 1 85 88' 97 115 87 r 90 155 119 177 102 174 149 71 r 68 97 r 415 329 322 244 82 no 81 85 139 82 126 85 160 140 57 r 54 r 77 413 280 276 198 144 96 195 160 88 55 96 162 Allentown.... Altoona............ Harrisburg.... Johnstown.. . . Lancaster......... Philadelphia .. Reading............ Scranton .......... 1 ren ton............ Wilkes-Barre.. Williamsport. . Wilmington. . . York..................... Payrolls Building permits value Retail sales +1 +18 +i +23 +2 0 +1 + 1 +8 +24 0 + 9 +1 + 6 0 + 5 0 + 13 0 + 7 0 + 4 -1 +14 -1 + 9 236 321 88 313 126 326 177 123 138 143 127 156 141 Employment* +5 +4 +47 +11 +13 + 3 + 4 0 - 2 + 1 - 2 - 6 - 8 +42 +48 +56 +43 +46 +34 + 9 +10 +17 +14 + 9 +16 +15 Payrolls* I Per cent Per cent Aug. change from Aug. change from 1941 1 1941 index July Aug. index July Aug. 1941 1940 1941 1940 Indexes: 1923-5 = 100 TOTAL................................... Iron, steel and products Nonferrous metal products Transportation equipment Textiles and clothing......... Textiles............................... 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.......... 110 +1 115 179 92 100 92 130 +1 +2 131 184 264 +1 +23 +33 +43 +46 0 +12 +13 105 97 147 125 115 77 143 109 118 100 -1 +1 110 +2 99 69 113 97 104 91 +6 +1 +1 +10 0 69 99 76 +1 -1 0 +10 4" 4 +24 + 8 +17 + 10 + 6 + 6 112 + 6 II 67 +20 1 126 +13 I 95 +4 +5 +8 +4 +1 0 +48 +64 +64 +64 +27 +26 +30 0 0 +40 +24 +33 +32 +16 + 9 +6 +4 +9 +5 +2 -2 +3 -4 -7 +10 +12 +40 +36 * Figures from 2,838 plants. Debits Aug. 1940 July 1941 Aug. 1940 July 1941 Aug. 1940 July 1941 Aug. 1940 July 1941 Aug. 1940 0 +3 +2 +3 +1 +1 +1 +3 +3 +3 +5 +i +3 +20 +26 +27 +24 + 18 +27 +13 +23 +12 +32 +19 +36 +14 + 4 + 9 + 12 + 8 + 7 + 2 + 2 + 19 + 6 + 3 + 7 + 4 + 1 +52 +36 +52 +53 +40 +55 +34 +30 +32 +68 +39 +70 +36 - 34 - 46 - ii + 5 + 41 + 76 — 65 + 62 + 140 - 18 - 65 - 40 - 27 + 20 - 18 - 47 + 13 + 68 +374 - 57 - 33 + 18 + 16 - 82 - 14 - 66 +34 +44 +26 +61 + 12 +31 +32 +34 +32 +34 +36 +29 +35 +46 +31 +32 +36 +36 +36 +43 +31 +25 +44 + 9 -2 -5 0 +2 -5 -3 -3 -3 +4 -3 +2 -8 -3 1-25 t- 8 h 9 1-23 1-24 b42 b38 h 9 bl5 rl4 -42 -27 - -33 * Area not restricted to the corporate limits of cities given here. 133 171 66 106 71 127 143 105 111 127 104 122 in Manufacturing Factory Workers Averages August 1941 and per cent change from year ago July 1941 Page Six GENERAL INDEX.............. Manufacturing..................... Anthracite raining.............. Bituminous coal mining . . Building and construction. Quar. and nonmet. mining. Crude petroleum prod.. . Public utilities...................... Retail trade........................... W holesale trade................... Hotels....................................... Laundries................................ Dyeing and cleaning.......... Hours and Wages Local Business Conditions* Employment 1932 = 100 p—Preliminary, r—Revised. unadjusted lor seasonal variation, t 3-month moving daily average centered at 3rd month, t No July or August figures due to strike. Percentage change— August 1941 from month and year ago Indexes: Payrolls Per cent Per cent Aug. change from Aug. change from 1941 1941 index July Aug. index July Aug. 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 Mus. instruments.. Weekly working time* Hourly earnings* Weekly earningsf Aver Aver Ch’ge Aver Ch’ge age Ch’ge ! age hours age 41 .0 42.2 42.4 44.0 37.6 37.8 37.0 39.2 37.6 41 .8 39.8 39.3 40.7 37.2 8 •$.814 9 .917 8 .722 .903 8 7 .573 6 .583 9 .544 0 .665 + 5 .769 + 8 .574 + 6 .859 +11 .570 + 5 .751 + 2 .912 +12 $33 07 +14 38.55 30.63 + 8 + 11 39.71 + 8 21.47 + 9 21.98 + 8 20.24 + 6 26.25 + 7 28.92 - 2 23.89 + 5 33.98 + 6 22 43 + 5 31.19 - 1 35.02 +21 +21 +16 +20 +15 +15 +16 + 5 +12 + ‘7 +12 + 16 + 9 +1 37.6 38.0 43.9 0 + 9 + 3 + 4 17.60 + 2 28.29 +14 | 32.31 + 4 + 11 +18 * Figures from 2,585 plants. + + + + + + + .469 .744 .735 t Figures from 2,838 plants. Distribution and Prices Per cent change Wholesale trade Unadjusted for seasonal variation Aug. 1941 from Month Year ago ago Sales Total of all lines..................... Boots and shoes................... Dry goods............................... Electrical supplies............... Groceries................................. Hardware............................... Jewelry.................................... Paper........................................ Inventories + 6 +41 — 3 +1S - 4 - 2 +10 +46 + 3 +52 +45 + 12 +75 +86 +33 +62 +45 +56 — + — + +17 + 5 +37 +22 +25 + 2 + 10 1 1 5 5 1 3 S Adjusted for seasonal variation 1941 from 8 mos. 1940 Indexes: 1935-1939=100 Aug. 1941 +37 +59 RETAIL TRADE Sales Department stores—District............................ Philadelphia.................. Women’s apparel................................................... Men’s apparel......................................................... Shoe............................................................................ Credit......................................................................... +37 +76 + 19 +55 +48 +25 Basic commodities 7 industrial............... 7 agricultural........... Wholesale (813)*. . Raw materials......... Finished products. . Farm........................... F ood............................ Other........................... Retail food* (1935-9=100)... . Philadelphia............. Scranton.................... 90 77 90 87 91 87 87 91 0 +4 +2 +1 +2 +2 +3 +1 130 130 112 114r 112 137 115 111 117 110 123 125 + + + + + + 18 13 34 27 51 35 + + + + + + 33 32 28 31 37 48 124p 116 122 109 135 113r 107p 100 150p 150 96 91 103 96 110 + 7 + 13 + 19 + 7 0 + + + + + 30 34 31 H 36 0 0 0 1 5 0 6 35 2 + + + + + + + + - 24 23 ii 33 12 23 35 2 9 154p 147 149 144p 168p 185p Aug. 1939 +15 +51 + 17 +25 +13 +33 +24 +11 +27 +60 +20 +31 + 16 +43 +30 +13 FREIGIIT-CAR LOADINGS Total............................................................................. Merchandise and miscellaneous...................... Merchandise—l.c.l................................................ Coal............................................................................. Ore............................................................................... Coke...................................................................... Forest products...................................................... Grain and products............................................... Livestock.................................................................. MISCELLANEOUS Life insurance sales................................................. New passenger auto, registrations.................... Hotels—(1934=100) 144 139 109 158 158 202 141 93 91 145 139 109 157 150 203 133 143 89 116 113 98 119 141 165 104 91 100 114 104 99 Business liquidations 108 105 109 +1 +1 +2 1941 from 8 mos. 1940 Aug. 1941 + 19 + 19 + 12 + 16 +20 +20 July Aug. 1941 1940 115p 89 107 84 110 65 109p 88 r 93 101p 155p 100 86 81 86 83 74 105 H5p 103 113 98 127 88 r 109p 87 145p 138 89 84 97 98 106 +24 +25 +12 +16 +38 +36 +47 + 6 - 5 151 144 107 152 275 178 148 110 95 150 143 108 139 282 187 138 161 80 122 117 97 115 245 145 109 108 104 + 10 + 16 - 36* + 23* +26* 96 105 99 164 83 86 + + 3* + 12* 3* + 14* + 8* + 9* 106 93 103 91 93 82 + 12* + 10* +199* + 112* + 13 + 42 — 9* + 10* +26 101 103 135 91 34 136 93 48 95 Inventories Per cent change from Aug. 1941 Month Year ago ago Aug. 1941 from July Aug. 1941 1940 Month Year ago ago Source: U. S. Department of Commerce. Commodity prices Index: 1926=100 Not adjusted Per cent change +12 +11 +14 +16 + 13 +18 * Source: U. S. Bureau of Labor Statistics. Check payments...................................................... 159 * Computed from unadjusted data. 140 112 + + + + p—Preliminary. r—Revised. BANKING STATISTICS MEMBER BANK RESERVES AND RELATED FACTORS Reporting member banks (000,000’s omitted) Changes in— 24, 1941 Assets Commercial loans.................. $ Open market paper............... Loans to brokers, etc............ Other loans to carry secur.. Loans on real estate............. 306 43 27 32 52 Other loans............................... 111 One year +$ + + + +$ 77 + 6 + 5 + 1 + 2 — l + 7 7 1 1 1 1 0 Total loans............................. $ 571 +$ 9 +$ 97 Government securities......... $ Obligations fully guar’teed. Other securities...................... 414 +$ 6 96 0 267 - 4 +$ 56 + 1 8 Total investments............... $ 777 +$ 2 +$ 49 Total loans & investments $1,348 +$11 Reserve with F. R. Bank .. 601 + 8 Cash in vault........................... 26 + 1 Balances with other banks . 231 + 12 Other assets—net.................. 77 - 2 +$146 + 124 + 5 + 15 2 Liabilities Demand deposits, adjusted $1,268 +$16 Time deposits.......................... 257 - 1 U.S. Government deposits. 19 + 2 502 + 11 +$259 4 - 28 + 54 Other liabilities....................... Capital account...................... + + 20 + 217 - 4 2 Changes in weeks ended— Philadelphia Federal Reserve District (Millions of dollars) Five weeks 4 3 Aug. 27 Sept. 3 Sept. 10 Sept. 17 Sept. 24 Changes in five weeks Source of funds: Reserve bank credit extended in district........... Commercial transfers (chiefly interdistrict) . . . Treasury operations................................................... -2.1 +2.8 -0.1 + 3.2 +46.9 -52.8 - 0.0 + 4.4 + 12.0 - 6.7 +25.4 -12.8 +6.2 +4.6 -8.4 + 0.6 +84.1 -62.1 Total............................................................................... +0.6 - 2.7 + 16.4 + 5.9 +2.4 +22.6 Uses of funds: Currency demand........................................................ Member bank reserve deposits............................... “Other deposits” at Reserve Bank....................... Other Federal Reserve accounts............................ +3.0 +4.4 -6.8 -0.0 + - 7.0 8.1 1.5 0.1 + 0.8 +14.7 + 1.0 - 0.1 + + + + i.i 3.3 0.7 0.8 +2.3 +2.3 -2.2 -0.0 +14.2 +16.6 - 8.8 + 0.6 Total............................................................................... +0.6 - 2.7 +16.4 + 5.9 +2.4 +22.6 Member bank reserves (Daily averages: dollar figures in millions) Held Re quired Ex cess Phila. banks: 1941: Aug. 1-15... $564.4 $259.6 $304.8 Aug. 16-31... 581.2 263.9 317.3 Sept. 1-15... 578.3 264.1 314.2 1940: Sept. 1-15... 463.0 221.9 241.1 Country banks: 1941: Aug. 1-15... Aug. 16-31... Sept. 1-15... 1940: Sept. 1-15... 203.7 111.0 92.7 211.4 112.4 99.0 219.7 113.3 106.4 99.7 193.3 93.6 Ratio of excess to re quired 117% 120 ” 119 ” 109 ” 83 88 94 94 w ” » ” Federal Reserve Bank of Phila. (Dollar figures in millions) Sept. 24, 1941 Five weeks Changes in— One year Bills discounted.... Bills bought................ Industrial advances. U. S. securities.......... $0.2 0 3.7 171.8 - $0.0 0 - 0.0 0 - $0.1 0 + 1.3 - 21.2 Total......................... Note circulation.... Member bk. deposits U.S. general account Foreign bk. deposits. Other deposits........... Total reserves............ Reserve ratio.............. $175.7 501.0 804.1 32.3 105.7 14.3 1305.5 89.6% + + - -$20.0 + 127.0 + 152.3 - 12.9 + 39.2 - H.i +315.9 + 4.5% $0.0 i6.4 16.6 28.7 9.2 • 8.8 13.2 0% Page Seven National Summary of Business Conditions INDUSTRIAL Industrial activity increased further in August and the first half of September, and commodity prices continued to advance. Distribution of commodities to con sumers expanded considerably. PRODUCTION Production Federal Reserve index of physical volume of production, adjusted for seasonal variation, 1935-39 average =100. By months, January 1935 to August 1941. FREIGHT-CAR LOADINGS Federal Reserve index of total loadings of rev enue freight, adjusted for seasonal variation, 1935-39 average =100. Subgroups shown are expressed in terms of points in the total index. By months, January 1935 to August 1941. In August industrial output increased somewhat more than seasonally and the Board’s adjusted index advanced from 160 to 161 per cent of the 1935-39 average. There were sharp further advances in activity in the machinery, aircraft, shipbuilding, and railroad equipment industries. Lumber production also increased, while furniture production, which had been unusually large in July, showed less than the customary seasonal rise in August. Output of steel and nonferrous metals continued at near capacity rates. In the automobile industry output of finished cars declined sharply as plants were closed during the changeover to new model production and output in factories producing bodies and parts also was reduced considerably. In the first half of Sep tember automobile assemblies increased as production of new models was begun but from now on, owing to Government restriction on passenger car production, output will be considerably below that during the previous model year. In most nondurable goods industries production in August continued around the high levels reached earlier this year. At cotton mills activity declined slightly from the record level reached in July, while at woolen mills there was some increase. Rayon output continued at peak levels. In the silk industry operations were curtailed sharply, as the Government requisitioned all supplies of raw silk, and deliveries of silk to mills declined from 28,000 bales in July to 2,000 in August. Rubber consump tion also decreased, owing to a Government curtailment program. Shoe production, which had been unusually large, increased less than seasonally in August, and output of manufactured food products and chemicals showed seasonal increases from the high levels prevailing in June and July. At mines coal production in August, as in other recent months, was unusually large for the season, and output of crude petroleum rose to a record level of 4,000,000 barrels daily in the latter part of the month. Iron ore shipments down the Lakes amounted to 11,500,000 tons, the largest monthly total on record. Value of construction contract awards showed a further sharp increase in August and was about four-fifths larger than a year ago, according to F. W. Dodge Corpora tion reports. The rise from July was substantial for all general types of construction but was most pronounced for publicly-financed projects. Awards for residential build ing continued to increase. Distribution Sales of general merchandise rose sharply in August and were at an extremely high level for this time of year. The Board’s seasonally adjusted index of department store sales advanced to 133 per cent of the 1923-25 average as compared with 115 in July and an average of 103 in the first half of this year. In the early part of Sep tember department store sales declined from the peak reached in the latter part of August. Railroad freight-car loadings in August were maintained in the large volume reached in June and July. Coal shipments increased, following some reduction in July, while loadings of grain, which had been large since last spring, declined. WHOLESALE PRICES OF BASIC COMMODITIES Commodity Prices Bureau of Labor Statistics’ indexes based on 12 foodstuffs and 16 industrial materials, August 1939=100. Thursday figures, January 3, 1935 to September 11, 1941. Wholesale prices of most groups of commodities continued to advance from the middle of August to the middle of September. Prices of grains, other foodstuffs, and cotton showed large increases and there were advances also in prices of a number of industrial commodities not covered by Federal price ceilings. Fragmentary data available indicate that retail prices of foods and other commodities rose further during this period. Agriculture The outlook for agricultural production in 1941 showed little change during August. Crop prospects were reduced slightly by drought but aggregate crop produc tion is expected to be two per cent larger than last year and the largest for any year except 1937. Total marketings of livestock and livestock products will probably be the largest on record. Preliminary estimates of the Department of Agriculture indicate that cash farm income, including Government payments, will be about $10,700,000,000, compared with $9,120,000,000 in 1940. MONEY RATES IN NEW YORK CITY Bank Credit Commercial loans at reporting member banks in 101 cities continued to rise substantially during the four weeks ending September 10. Bank holdings of United States Government securities showed little net change, while holdings of other securi ties increased somewhat at New York City banks. As a result of the expansion in loans and investments bank deposits continued to increase. 1935 1936 1937 1938 1939 1940 1941 Weekly averages of daily yields of 3 to 5-year tax-exempt Treasury notes, Treasury bonds callable after 12 years, and average discount on new issues of Treasury bills offered within week. For weeks ending January 5, 1935 to September 13, 1941. Page Eight I United States Government Security Market Prices of Treasury bonds increased in the latter part of August but subsequently declined somewhat in the first part of September. On September 15, the partially tax-exempt 2% per cent 1960-65 bonds were yielding 2.06 per cent compared with the record low yield of 2.02 per cent. Yields on Treasury notes showed little change in the period. d
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