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Business Conditions
Report o f the Federal Reserve Agent
at Philadelphia
to the Federal Reserve Board

October 28, 1920.
FE A T U R E S
Reduction in orders to manufacturers.
Price readjustment proceeding.
Labor situation somewhat better.
Transportation continues to improve.

GENERAL SUMMARY
T h e process of readjustment which is taking place within the
Third Federal Reserve District is regarded as the natural result
of the tremendous expansion incident to the war. In line with the
previous lessons of history, we are told that prices in the manu­
facturing and wholesale markets generally have been declining,
and that orders are being withheld until the purchasers feel that
a stable basis has been attained. During the past month prac­
tically all lines of manufacturing have reported a diminution in
demand or a continuation of the inactivity in new business which
had been felt for a few months hitherto.
The opinion of the community seems to be that there cannot
be a return of substantial business conditions until consumers
are satisfied that prices are stable. What buying there is is
being done very conservatively and only for immediate needs.
Back orders are enabling many manufacturers to continue oper­
ations. Unless there is a revival in business, plants will have
to shut down when these orders have been filled.
Transportation is for the most part fairly satisfactory; raw
materials, with few exceptions, are in ample supply and labor is
more plentiful. In other words, the factors affecting supply are
favorable and production is now rid of many of the difficulties
which it had faced for a long period.




1

Reports which we have received from the Pennsylvania
Bureau of Employment state that agricultural laborers are apply­
ing for work in increasing numbers and that a surplus exists in
many lines of manufacturing due to the decline in industrial
operations. Common labor demand slightly exceeds supply, but
the coming of immigrants to our shores may be expected to help
this situation. Applicants for clerical work are said to be par­
ticularly plentiful. The following figures show the number of
men applying to the bureau for work in six of the principal cities
of this district during the first two weeks of October.
OCTOBER
First week
S e c o n d week

Agriculture ................
Building trades ..........
Machinery and metals
Clerical .......................
Transportation ..........
Sales .............................
Common labor ..........
M iscellaneous ............
T otal

56

120

397

293

1 ,0 4 8

952

69

70

88

56

14

1 ,5 8 5

276

335

3 ,0 9 5

...................

19

1 ,1 4 7

3 ,4 3 0

Collections generally are slow, though a few firms inform
us that they have been somewhat better during the last few
months. The impossibility of realizing on stocks of goods on
hand without large losses have compelled many concerns to post­
pone their payments. The continued borrowing that this causes
is costly on account of the high rates for money. Commercial
paper remains firm at 8 per cent for the best names and higher
rates are quoted for other firms which are not so well known.
RETAIL TRADE
Sales still ahead o f last year

The continuance of the warm weather during the past month
has had an appreciable effect on retail trade, in that it has delayed
the fall buying season. This has resulted in a hesitancy on the
part of the public to make purchases, and buying as a general
thing is being restricted to immediate needs only.
As a whole, retail business may be said to be good, with sales
showing an increase as compared to this time last year. Prices
are distinctly on a downward movement.
Collections in the retail trade in contrast with all the textile
industries are exceptionally good, with charge accounts being
met very promptly.




2

The outlook as a whole is good, and retailers are looking for
a fairly large volume of business during the balance of this year
and the first quarter of 1921.

1
.

.

R E T A IL T R A D E O F D E P A R T M E N T ST O R E S
For the month o f September, 1920
Per cent increase or decrease
Entire
Outside o f
In
District
Philadelphia Philadelphia

Net sales

For month named compared to same month,
1919............
For period July 1 to end of month named,
compared to same period last year........

+ 10.5

N OTE

+ 15.1

+ 16.9

+ 23.1

+ 19.5

+ 17.6
- f 8.8

+ 25.0
+ 7.6

+ 20.5
+ 8.3

375.1

2 Stocks at end of month named :
Compared to same month, 1919....................
Compared to previous m o n th .......................
3. Ratio of average stocks at end of each month
for period from July 1 to date, to average
monthly sales for same p e rio d .....................
4. Ratio o f outstanding orders at end o f month
named, to total purchases during year 1919

+ 21.4

583.6

454.2

1 2 .0 *

7.6

1 0 .1 *

Percentages for item 4 corrected since issuance o f advance report.

AGRICULTURE
The past month has been favorable for the maturing of crops
and considerable seeding of winter grains has been done. There
has been considerable damage done to unharvested cranberries
by early frost, running as high as 25 per cent on individual bogs.
The condition of the crop on October 1 was 61 per cent of normal,
indicating a production of 120,000 barrels compared with 156,000
barrels last year. The Massachusetts crop is estimated at 291,000
barrels and the Wisconsin crop at 38,000 barrels.
The following table will show the condition of crops and
yields for the states of Delaware, New Jersey and Pennsylvania:
PE N N SY LV A N IA
LAST Y EAR

O C T O B E R 1, 1920

Crop

Estimated
condition
(per cent)

Spring wheat
Corn .. .
Oats... .
Buckwheat...
Potatoes...
Sweet potatoes
Apples.........
Pears.




91
92
93
84
85
90
95
92

Estimated
yield per
acre

16 bu.
44.2 “
39
“
20.6 “
100.3 “
118.8 “

Estimated
total
production

368,000 bu.
64,429,000 “
44,967,000 “
5,171,000 “
24,172,000 “
119,000 “
22,515,000 “
661,000 “

3

PAST
TEN YEARS

Final
production

Average
production

390,000 bu.
72,192,000 “
36,859,000 “
5,530,000 “
25,400,000 “
138,000 “
7,972,000 “
355,000 “

61,115,000 bu.
37,898,000 “
5,640,000 “
23,580,000 “

NEW JERSEY
O C T O B E R 1, 1920

Crop

Estimated
condition
(per cent)

Corn..............
Oats................
Buckwheat...
Potatoes........
Sweet potatoes
A pp les..........
Pears............

93
87
84
94
96
93
82

Estimated
yield per
acre

43.7 bu.
32 “
21 “
136.3 “
142 “
...
...

LAST Y E A R

Estimated
total
production

11,187,000 bu.
2,464,000 “
210,000 “
14,534,000 “
1,988,000 “
3,627,000 “
827,000 “

TEN YEARS

Final
production

Average
production

10,800,000bu.
2,461,000 “
197,000 “
10,550,000 “
1,750,000 “
2,313,000 “
500,000 “

10,603,000 bu.
2,327,000 “
252,000 “
9,903,000 “
2,627,000 “
2,241,000 “
605,000 “

D E LA W A R E
C om ..............
O a ts..............
Buckwheat...
P ota toes___
Sweet potatoes
Apples..........
Pears............

96
90
85
88
87
81
75

8,646,000bu.
165,000 “
117,000 “
1,056,000 “
889,000 “
1,013,000 “
285,000 “

6,900,000 bu.
115,000 “
108,000 “
913,000 “
966,000 “
750,000 “
200,000 “

It is interesting to note that in a great many rural com­
munities, the matter of collective buying has been given some
consideration. Commodities which are usually bought in carload
lots, through the activity of local granges and cooperative soci­
eties are coal, grain, and fertilizers. By purchasing in this
manner, the farmer gets the benefit of the lower market price.
Cooperative selling, however, has not as yet been developed
to any great extent. The only products being handled in this
way at the present time, to any extent, are sweet potatoes, toma­
toes, cranberries and fruit, all of which are represented by an
association.
The monetary return farmers are getting for their crops at
this time are not satisfactory, as the crops were produced during
the time of high price levels and are now being marketed when
prices have dropped. It is because of this fact that more of our
rural population is drifting to the cities each year, as the cash
returns do not warrant the farmers paying the wages by which
they can compete with industrial concerns for labor.
Farmers as a class are in a receptive attitude toward laborsaving machinery and many of them are working with tractors,
power sprayers, seeding machines, gasoline machines, etc., as
they look toward the new machinery to help overcome the labor
problem.




4

It is gratifying to note that most of the banks are cooperating
with the farmers. One bank has fostered the Corn Show, another
is purchasing a carload of pure-bred cattle and still others have
helped farmers’ exhibits by offering prizes. Another bank states
that they would rather loan money to the farmers than to send
it away from the county at a higher rate of interest.
COAL
Bituminous production increases

Production of bituminous coal in the United States during
September totalled 49,205,000 net tons, the largest month’s produc­
tion since October 1919. For the first 240 working days of this
year the output was 416,206,000 net tons, as compared to 364,682,000
tons in 1919 and 461,524,000 in the same period of 1918.
The demand for spot coal continues and some buyers are in
sore straits for additional supplies. The complaint generally
is that while they have notices of shipments from the mines, the
railroads are often two weeks in making deliveries. While it is
true that the car supply and transportation conditions have im­
proved, yet a large percentage of available equipment is assigned
under mandatory orders of the Interstate Commerce Commission
for fuel for public utilities, public institutions, and steam rail­
roads, all having priority over all commercial users.
Prices are still high, but have eased off during the past few
weeks. Highest grade coals are selling at about $11 to $12 and
lower grades at $8.50 to $9 per ton f.o.b cars at the mines.
The export trade, however, is developing added strength
and the amount of tonnage consigned to the local piers comes
close to being the heaviest on record. Probably the bulk of this
business is on the high-volatile coals. On the best Pennsylvania
gas grades the prices have been $11 and $11.50 per net ton at mines.
The Fairmount coals have kept close behind with the bulk of the
sales at $10.75.
The supply of labor is becoming considerably easier, due to
the fact that there is quite an influx of men into the mining
regions coming from the large industrial centers where they have
been receiving high wages for the past four or five years. It is
also interesting to note that this flourishing condition in the min­
ing sections is being favorably reflected in the increase of bank
deposits in those districts.




5

Anthracite miners return to work

The anthracite mines are now nearly at a normal rate of
production, the last of the striking miners at Pittston having
returned to work on October 8. Every effort is now being made
to increase production and make up the deficiency growing out of,
first, the outlaw switchmen’s strike in the early part of the year,
and second, by the “vacation” idleness of the miners in Sep­
tember. The deficiency itself is not large and if the present
rate of production can be maintained, it is believed that there
will not be a serious inconvenience on account of a shortage of
fuel this winter, provided ordinary temperatures prevail. Car
supply and transportation are in good shape and distribution
is being made as equably as possible.
The high prices still maintained have caused small con­
sumers in many instances to take fewer tons at a time. It is
reported that some independent operators are getting as high as
$14 and $15 a ton at the mines, for prepared sizes. Barley is the
only slow size in anthracite, all of the others, especially domestic
sizes being urgently sought after.
IRON AND STEEL
Decrease in current demand

Although the past month has shown a decided improvement
in the movement of iron and steel products the same improvement
is not reflected in the industry as a whole. While many firms have
not experienced any shortage of cars and some have been able to
move their entire stocks there are still many who are having some
trouble with their transportation problems. Many requests for
delay in shipment have been granted and cancellations are re­
ported to be numerous wherever there has been an excuse. The
demand for iron and steel products has undergone a rapid decline
and we are informed that orders placed recently have been for
comparatively small amounts. The unfilled orders on the books
of the United States Steel Corporation on September 30 were
10,374,804 tons. Compared with August 31, there is a decline
of 430,234 tons as against a decline in the previous month of
313,430 tons which was the first month to show a decrease since
May, 1919. Production continues at a very high rate on back
orders.
Uncertainty as to future prices is the most disturbing factor
in the industry today. Consumers have reacted to the general
feeling that there would be a weakening in prices and have




6

shown little or no interest in quotations. That there is some rea­
son for the waiting attitude of consumers is evidenced by the fact
that certain grades of pig iron declined in price during the week
ending October 21, the decline in No. 2X Pennsylvania being
from $53.51 to $51.54 per ton. Coke prices also decreased during
the week. The pig iron market has been in rather chaotic con­
dition for the past several weeks and reselling has dominated the
market with few sales at the furnaces. The average daily produc­
tion of pig iron during September was 104,310 tons, which is the
largest since March of this year.
A manufacturer of steel forgings gives over-expansion as
one of the principal causes of present idleness: “ There are, in
round numbers, fifty-six forge plants east of the Mississippi
which increased their capacity during war time over 500 per cent.
For the past year, the forgings purchased have represented about
15 per cent of a normal pre-war year.” Though such conditions
would usually lead to pessimism, that feeling does not predomi­
nate, as this producer points to saner business and working con­
ditions as the guiding posts in the future.
Our reports would indicate that the steel casting business
is now operating at about sixty per cent of capacity. In this
phase of industry there is little expectancy that there will be any
material improvement for some time; at least not until the rail­
roads begin to place orders which in normal times constitute the
major portion of their output. The decreased operations of the
automobile people have had an adverse effect on this line also.
Difficulties in making deliveries and high costs have resulted
in a material decrease in the demand for steel shapes and a promi­
nent manufacturer sees nothing in sight to improve the situation
for the balance of this year and the early part of next. Prices
are weakening.

Producers of plumbing supplies report that while the demand
for their product during the first nine months of this year was
very large, this demand has fallen off very much during the
past month and that they do not look for a resumption to any
extent until after the first of the year. Although the building
contracts let for the first nine months of this year exceed by
approximately 20 per cent those of the same period of last year
the architects and engineers report little immediate work in
hand and that every office has had returned to it large numbers
of blue prints that have been put out and returned on account
of high prices and a general expectancy of a lower price level
being reached before long.




7

While there is still considerable activity in both basic and
finished products and many concerns have orders sufficient to
run them until after the first of the year, there are others that
state that unless healthy buying begins shortly there will be
many producers who will be forced to cease operations entirely
instead of operating on a reduced schedule as they are at present.
Cancellations on the part of automobile manufacturers have
also contributed to the unrest which prevails in the industry.
Manufacturers af alloy and tool steels are especially affected.
In some instances demands for revisions of contracts have been
complied with but in the main the producers are insisting upon
the completion of the contracts. The opinion of one of the
large manufacturers of supplies for the automobile industry is
that in his judgment the situation now confronting the industry
is nothing new as they passed through similar situations at least
twice during the last sixteen years but possibly this is the worst
one which they have been obliged to face. This situation has
been brought about very largely by increased production of cer­
tain types of cars, for which there is no possible outlet, which
finally reacted in a curtailment of credit.
Mining machinery and power transmission apparatus is still
in very fair demand, but pumping machinery and engines are in
smaller request.
In no phase of the iron and steel industry has there been any
activity in new business although in some instances a lowering
of prices has been made. Even the lowering of prices has failed
to produce orders in quantity. What prices will do in the future
depends largely upon the trend of raw materials.
AUTOMOBILES
Prices o f many cars lower

The past month has experienced a marked reduction in
the price of many kinds of passenger cars.
These reductions
have varied from $140.00 to $1,350.00. From many sources comes
the contention that this reduction is due to over-production and
tight credit conditions and as a result, forced liquidation on the
part of the manufacturers. The manufacturers maintain that it
is their duty to liquidate and reduce prices and that their liquida­
tion is being done at a net loss at the expense of better business
tomorrow. Reductions in the medium priced cars is accompanied
by a marked hesitancy in the purchasing of the higher priced
cars on which no reduction has been announced. To meet this




8

situation the manufacturers of the latter type have made guar­
antees to the effect that if a reduction is made it will be retro­
active for a certain period, or that there will be no reduction for
a definite period. We are told that within the past few days as a
result of these guarantees and reductions there has been a marked
increase of inquiries and purchases.
BUILDING MATERIALS
Little demand fo r lumber

The demand for lumber has fallen off steadily in the past
few months and sales at the present time are almost at the point
of stagnation. Building costs are so high that no one seems
to care to build under the very difficult existing conditions, fearlng a property depreciation after the work is completed.
The price tendency is distinctly downward, reductions rang­
ing from 10 to 30 per cent below the peak prices of this year.
Lumber prices, however, are generally about 100 per cent above
the low levels of 1915.
There is a marked improvement in the transportation situa­
tion, and shippers at both ends are doing everything possible to ex­
pedite the loading and unloading of cars. The car supply is
also more adequate. The railroads are moving lumber much
more rapidly than they have been for a long time.
Collections on the whole are slow, but are considered fairly
satisfactory in view of the difficulty of securing mortgage money
and the tightness of the money market in general.
Active demand fo r cement

The demand for cement is and has been of such proportions
that manufacturers are unable to produce in sufficient quantities
to meet the situation, except in certain instances where plants
catered to specific types of customers. The capacities of the
various plants probably would have been adequate under normal
conditions, but the difficulty in securing sufficient coal, trans­
portation difficulties, and the scarcity of efficient help have
hampered this industry to a very large extent. Stocks are said
to be low in plants all over the country.
This combination of influences has been instrumental in
maintaining the present high prices, which have been almost sta­
tionary since last spring. The present figures represent an in­
crease of slightly more than 100 per cent over pre-war prices.
The greatest factor with reference to cement has been the ad­




9

vanced price of coal. As an illustration, one concern for the past
17 years was able to purchase coal, that is—screenings from threequarter high volatile coal which is practically a waste product
in normal times, at an average of 75 cents per gross ton at the
mines. Under normal conditions, at a delivered price of $2.70
a long ton, the cost of the coal used in manufacturing a barrel
of cement was 20 cents. The average cost of coal this year is
about $14.50 per short ton, delivered, or $1.12 per barrel. It can
be readily seen that coal is costing on an average of 92 cents per
barrel more than it did in pre-war times.
With the exception of a tendency to ask for extensions on
maturing trade acceptances, in some cases, the status of collec­
tions may be regarded as satisfactory.
Orders fo r hardware mainly fo r current needs

The current demand for hardware has declined noticeably
during the past few months with the exception of some heavy
lines. While present orders are small and for immediate needs
only, manufacturers are, for the most part, running at full capacity
where raw materials are available in sufficient quantity. The
loosening of transportation has been of material assistance in
enabling manufacturers to meet the demand.
While some manufacturers are quoting advances or decreases
on their goods, due to special conditions applying to them, the
majority report stationary prices.
W H OLESALE H A R D W A R E TR AD E

.

Per cent increase or decrease

1. Net sales (selling price) during month
a. As compared to previous m onth............................
b. As compared to
same month last y e a r

or pt‘ '
— .4
-(- 22.4

2. Accounts outstanding at end o f month (selling price)
a. As compared to previous month ...........................
b . As compared to
same month last year.

+ 3.1
+ 27.9

3. Ratio o f accounts outstanding at end o f month to net
sales during m o n th .......................................................

151.9

Paints in actire request

The paint industry is enjoying a steady demand for the
most part and there are few reports indicating any falling off
in orders at this time. Manufacturers are able to meet the
demand. Plants are being operated generally 80 to 100 per cent
of capacity. While a few lines show decreases in prices, the




10

majority are stationary at levels much in excess of pre-war
times.
The raw material supply is considerably improved so far as
ability to get a sufficient amount is concerned. Prices as a whole
are holding their own with the exception of linseed oil which
has decreased in price. This, however, is counterbalanced by an
increase in the price of pigments.
New business quiet in pottery industry

The pottery industry at this time is being governed by di­
verse factors such as diminution of demand, scarcity of skilled
labor, shortage of fuel, and the financial situation.
The demand for sanitary pottery, porcelain, and specialties
has fallen off appreciably during the last three months, largely
due to the curtailment in building operations, although some of
the local potteries are operating to practically 90 per cent of
capacity. This is accounted for by the fact that work is being
completed on back orders. Prices have practically remained
stationary for some time, but still represent an increase of about
100 per cent over those prevailing before the war.
The raw material supply for the most part is steadily im­
proving, which is attributed chiefly to the improvement in the
transportation situation. Skilled labor is scarce and demanding
a heavy increase in wages, while on the other hand, unskilled
labor is more plentiful than has been the case since the termina­
tion of the war. However, at the recent conference of pottery
men held at Atlantic City during the week of October 13, an
agreement was entered into between the manufacturers and em­
ployees for a period of two years, granting an increase of 5 per
cent.
Collections are not as good as they were three months ago,
but on the whole are fairly satisfactory.
COTTON
bow demand fo r cotton goods and yarns

Business throughout the entire cotton industry is virtually
at a standstill. No orders are being placed except where it
is absolutely necessary in order to have goods on the shelves.
No surplus stocks are being bought, nor are the ordinary needs
of the near future being anticipated. Manufacturers of cotton
goods and yarn spinners are therefore unable to enter the raw
material markets, with the result that the industry is deadlocked.




11

Below is given a chart which shows the consumption of raw
cotton in the United States by months:
C O T T O N C O N S U M P T IO N IN T H E U N IT E D S T A T E S

While curtailment of production has been general, many con­
cerns are still operating, with the result that cotton yarns and
cotton goods are rapidly accumulating and will continue to pile
up more rapidly now that orders which were booked months ago
and were not cancelled have practically all been filled.
This complete apathy continues in the face of repeated price
declines. The quotations for cotton goods are generally 40 to
50 per cent below the high levels of early 1920, and for yarns
50 to 60 per cent under the peak, but are about double pre-war
figures. Manufacturers of heavy cotton fabric are also feeling
the effects of the slump in demand, and are quoting prices at a
30 per cent reduction.
While no general reduction in wages has been announced and
none is expected at this time, it is reported that the employees
of a number of mills, facing complete shutdown, have voluntarily
accepted a cut of 10 to 15 per cent in order to make it possible
for operations to continue.
Collection conditions are particularly disconcerting, for the
failure to meet bills promptly has made it necessary for manu­
facturers to secure additional credit extensions in order to con­
duct their business.
The transportation situation shows considerable improve­
ment, and the congestion of freight and delays in transit have
been greatly reduced.




12

WOOL
Cancellations in the woolen cloth industry

When, during the second week of September, the American
Woolen Company announced its prices for spring, 1921, a large
volume of business in the woolen and worsted cloth industry
was looked for. This has failed to materialize, however, for the
25 per cent reduction was not sufficient to create any consider­
able interest on the part of clothing manufacturers. As a result
many cloth weavers made further concessions, but these also
failed to stimulate buying.
Reports received by this bank from a large number of corres­
pondents indicate that so little interest is being manifested in
woolen cloth that the volume of business has caused concern.
One large manufacturer writes: “ The demand for our product is
momentarily at a standstill, due to a violent drop in prices of raw
material, the demoralization in the markets for all wool products,
and to wholesale cancellations on an unprecedented scale.”
The chart given below shows consumption of wool in this
country since the beginning of 1919 up to the end of August, 1920:
W O O L C O N S U M P T IO N B Y M A N U F A C T U R E R S

Prices have been trending lower and lower, and buyers are
holding off in the expectation of further declines. Manufac­
turers, however, feel that these are not warranted by conditions,
for although the prices of raw materials have receded, other ele­
ments entering into production have not decreased, some having
even advanced.




13

Lower demand fo r woolen yams

Woolen yarn spinners are receiving practically no orders
for their product and although the months of September and
October are usually the busiest, demand has become almost nil.
Raw material is in ample supply and is trending to lower
price levels, which correspond in general with the price trends
of the finished yarns. The prices of woolen yarn have diminished
greatly, being from 35 to 50 per cent lower than peak prices of
1920, but are still double those of 1914. One manufacturer cites
the advances in yarns as follows: “ On 1/40’s worsted yarn, which
is used as a gauge point, the price in 1912 was from 85 to 90
cents per pound, in 1916 $1.30, in 1920 the peak price was $4.00
and the present price is $2.50.”
Consistent with the lack of demand for yarns, mills are oper­
ating at a very low percentage of their total capacity, varying
from 10 per cent to 80 per cent. Those operating at 80 per cent
were busy filling back orders but anticipated shutting down en­
tirely upon the completion of these orders. One factory which
is working at 30 per cent of its capacity, reports that from 30 to
40 per cent of this product is for stock.
Collections are reported as slow, but more satisfactory than
during the early spring. The transportation situation has cleared
up, and although embargoes are again in force to some New Haven
railroad points, conditions are greatly improved.
W o o l market dull

W ool dealers are experiencing the dullest period in their
history. There is, in effect, no basis for prices of wool as there
is practically no market. Offers below market quotations do not
even tempt buyers, who are holding off in the expectation of
further declines and the few orders being placed are for sample
lots.
England, which usually takes over the greater part of Aus­
tralian wool, recently ceased purchasing, throwing the Australian
product on the open market, and causing a plentiful supply of
the higher grades. The market is also glutted with inferior
grades of wool which have declined about 60 per cent, while the
better grades have decreased about 50 per cent.
Collections are said to be very poor, accounts in many in­
stances running over the due dates. This is attributed to can­
cellations which are becoming more numerous every day.




14

SILK
Improvement in orders

The recent decline in all the textile lines is given as the draw­
back to an immediate resumption of activity on a large scale, in
that it is acting as a deterrent to a large buying movement. In
spite of this, however, the demand shows considerable improve­
ment over last month, and while all the orders placed are small,
a steady stream of these is reported. The better feeling in the
silk trades has been caused by the apparent success of the action
of the Japanese government in stabilizing raw silk prices. These
are now fairly firm, and as a result a stop has been put to the
slashing of the prices of manufactured goods. Quotations for
these are now about 40 per cent below the highest point reached
early this year.
There are but few complaints from the manufacturing trades
as to labor conditions and they may now be said to be satisfactory.
The transportation situation is much improved and is causing
none of the serious embarrassments which were so common a few
months ago.
HOSIERY
Conditions remain unchanged

The hosiery market continues demoralized. The inability
of manufacturers to determine upon a price level and to strictly
adhere to such a level is reported as the main cause for this
situation. During the past month prices have been continually
revised, and as a result, jobbers and retailers refuse to enter the
markets, in the expectation of further declines. These price
changes have been made because of the recessions in yarn prices.
Many manufacturers in need of immediate funds have been offer­
ing stocks at prices much under production costs, and this also
has contributed greatly to the instability of hosiery prices.
In some quarters, however, there is reported a fair volume of
business for immediate needs. Reports of this nature are the
great exception, and as a general thing, the hosiery trade in this
district may be said to be at a standstill. As a result, the closing
of plants is general and unemployment in the industry is pre­
valent. The employees of two reporting mills have offered to
accept reduced wages in order that some operations, however
limited, may continue. In mills which are still running the labor
situation is wholly satisfactory and is better than at any time in
the last few years.




15

i

S Y N O P S IS

Compiled as of October 22, 1920

OF

BO

? M E SS

Philadelphia Fed*

S IT U A T IO N

1Reserve District
- 1 ______________________________________________________________________________________________

Business

Demand

Ability to
supply demand

Prices
4

Raw material
or merchandise
situation

Attitude o f labor

Transportation

Collections

A U TO M O B ILE S

Decreased

Able

•wer

Improved

Improved

Improved

CEMENT

Strong

Unable

Ifm

Improved

Improved

Improved

CIGARS

Good

Able

Ifm

Good

Improved

Improved

Good

COAL, A N T H R A C IT E

Strong

Unable

Ifm

Fair

Improved

Good

COAL, B IT U M IN O U S

Strong

Unable

Fair

Improved

Good

COTTON Y A R N S

Very inactive

Able

: **er

Good

Improved

Improved

Poor

COTTON GOODS

Very inactive

Able

V er

Good

Improved

Improved

Poor

G RO CER IES

Fair

Able

Good

Improved

Fair

HARDW ARE

Decrease

Able

Improved

Improved

Improved

Fair

H O SIE RY

Inactive

Able

'bstable

Good

Improved

Improved

Slow

IRON AN D ST E E L

Decrease

Able

Qstable
_______

Improved

Improved

Improved

Slow

LEATHER

Very inactive

Able

,^wer

Good

Improved

Improved

Poor

LUM BER

Decrease

Able

■*wer

Improved

Improved

Slow

P A IN T S

Good

Able

•^tionary

---

Improved

Improved

Good

POTTERY

Decrease

Able

^tionary
—
"v

Improved

Improved

Fair

R E T A IL T R A D E

Good

Able

Improved

Good

SHOES

Inactive

eaker

Fair

Slow

‘ ^ghtly lower

Good

Able

*“
0wer

Good

Improved

Improved

Slow

Good

Improved

Improved

Fair

SILK GOODS

Inactive

Able

: ttm at low

UNDERW EAR

Inactive

Able

'^stable

Good

Improved

Improved

Slow

W OOLEN YARNS

Inactive

Able

^ w er

Good

Improved

Improved

Slow

W O O L E N CLO TH S

Inactive

Able

"iwer

Good

Improved

Improved

Slow




16

17

Due to the refusal of jobbers at this time to make any com­
mitments, there is much discussion among manufacturers with a
view to the elimination of the middlemen and the marketing of
hosiery directly to the retailer. While this has not yet taken
the form of a definite movement, the plan is being earnestly ad­
vocated in mill circles.
OPERATIONS IN THE HOSIERY INDUSTRY
F or firms selling to the wholesale trade

Per cent increase or decrease for
July, 1920
A u g. 1920
Sept. 1920

1. Product manufactured during month (sell­
ing price)
As compared to previous m o n th ............
As compared to same month, 1919........

— 36.2
— 17.5

2. Finished product on hand at end o f month
(selling price)
As compared to previous m o n th ............
As compared to same month, 1919........

— 33.3

— 43.0
— 58.9

+ 137.7

-f
4.5
- f 174.1

— 3.6
+ 150.9

3. Raw materials on hand at end of month
(cost price)
As compared to previous m on th ............
As compared to same month, 1919........

— 5.0
- f 84.5

+
+

1.2
91.4

— 5.6
+ 49.0

4. Unfilled orders on hand at end of month
(selling price)
As compared to previous m on th ............
As compared to same month, 1919........

— 17.6
— 35.2

— 13.4
— 61.9

— 22.4
— 71.6

— 49.8
-j
6.4

4-

15.3
23.6

f
+

5.1
19.8

— 14.1
4 - 43.5

4-

13.2
63.9

—

3.5
62.3

7.3

+

6.2

—

22.2

F or firms selling to the retail trade
1. Product manufactured during month (sell­
ing price)
As compared to previous m o n th ............
As compared to same month, 1919........
Finished product on hand at end of month
(selling price)
As compared to previous m o n th ............
As compared to same month, 1919........
3. Raw materials on hand at end o f month
(cost price)
As compared to previous m o n th ............
As compared to same month, 1919........
Unfilled orders on hand at end of month
(selling price)
As compared to previous m o n th ............
As compared to same month, 1919........

4-

4-

4 - 130.2

4.6
* 160.2

— 29.4
_l_ 76.6

— 10.9
— 82.2

— 13.6
— 87.7

— 38.4

4-

UNDERWEAR
Buyers stilt disinclined to operate fo r future requirements

The general announcement of spring, 1921, underwear prices
which was looked for the latter part of September or early Octo­
ber has not been made, with the result that the stabilization of
the market, which it was hoped such an announcement would pro­




18

duce, has not come. On the contrary, further instability has
been caused by manufacturers here and there having made quo­
tations, and these are so far out of line that jobbers are less inter­
ested in the market than ever. No orders for future delivery are
being booked and the hand-to-mouth business is very small. As
is the case in the hosiery industry, an agreement as to mill prices
among manufacturers is necessary before a buying movement can
be expected.
As a result of the lack of orders, mills are either shut down
or running at very reduced capacity, and there is much likeli­
hood, manufacturers say, that a scarcity in many lines may result
next spring, for unless operations are soon resumed, it will be
impossible to produce the needed supplies.
The manufacturing situation is greatly improved with raw
material supplies adequate, transportation no longer furnishing
a problem, and the labor supply plentiful and more efficient. Col­
lection conditions are very poor and the request for extension
of due dates is general. The outlook is very uncertain, depend­
ing in large measure upon the stabilization of yarn quotations
and the agreement of manufacturers upon prices.
O P E R A T IO N S IN T H E U N D E R W E A R IN D U S T R Y
Per cent increase or decrease for
July, 1920 A ug. 1920 Sept. 1920

1. Product manufactured during month named
a. As compared to previous m o n th ....................
b. As compared to same month last year..........

— 16.9
— 13.0

+
4.9
— 11.1

— 27.5
— 33.2

2. Finished product on hand at end o f month named
a. As compared to previous m onth......................
b. As compared to same month last year..........

+ 46.6

+ 27.0
+ 279.1

+ 24.2
+ 70.8

3. Raw materials on hand at end o f month named
a. As compared to previous m o n th ....................
b. As compared to same month last y e a r ..........

— 15.6

_

— 8.8
+ 38.9

+

4. Orders booked during month named
— 60.0
b. As compared to same month last y ea r........
5. Unfilled orders on hand at end o f month named
a. As compared to previous m onth....................
b. As compared to same month last y ear........

— 23.4

3.0
38.7

—
_

63.9
99.8
53.9*

— 51.2

*N O TE —Corrected since last report.

CARPETS AND RUGS
Current orders very small

“ Watchful waiting” seems to characterize the attitude of
buyers in the carpet and rug markets. The exceedingly high
prices, which prevailed during the past year, for carpets and




19

rugs, resulted in an unprecedented falling off in demand. There
was a feeling among some manufacturers that the opening of the
spring season, which takes place on October 1, should be deferred
for a couple of months, when it was hoped conditions would be­
come more settled. This, however, was thought by others to be a
poor policy and it was decided to hold the opening at the regular
time, and to offer a guarantee against a drop in prices during the
next five or six months. Even this guarantee failed to stimulate
buying, and it is reported that practically no orders are being
placed.
The percentage of operations varies from 10 per cent of
normal to full capacity. Those who report working at full capa­
city have been manufacturing for stock in the expectation of an
increased demand. If this did not materialize they intend to
shut down completely.
Raw materials are plentiful, with noticeable reductions in
wool and jute yarns. The prices of cotton yarns show the great­
est decline, while those of white fibre, or paper yarns, have been
advanced. This falling off in the cost of raw materials is reflected
in the manufactured articles by a drop of about 10 to 12 per cent
from peak prices of 1920, but present prices are about double
those of the pre-war period.
Collections are not satisfactory. Many large houses are
asking for extensions, and in most cases bills are allowed to run
to maturity. Freight conditions show a marked improvement,
but express and parcel post shipments continue to be much too
long in transit.
The high money rates and difficulty in obtaining loans are
given as contributing causes of the depression in this industry,
large houses always prompt in payment complaining of inability
to obtain loans from banks.
GROCERIES
Readjustment on in grocery prices

General conditions in the grocery trade during September
show some improvement, with the business fast recovering from
the setback brought on by the break in sugar. Buying was slightly
better than in the preceding month, although it is still very con­
servative. There is an unwillingness to anticipate future needs
and a tendency to purchase in moderate quantities not ahead of
actual and pressing requirements. The natural consumptive de­
mand is the main support of the market. Prices on practically




20

everything are tending toward a further slight decline, although
there is a feeling that the heaviest losses in certain food prod­
ucts have been weathered. No general drop has made its appear­
ance since the break in sugar, but decreases have occurred in
the prices of individual articles from day to day.
Sugar, flour, canned goods and prepared foods made from
sugar and flour, have declined sharply. In some instances new
packed goods, such as dried fruits, are held at prices higher, con­
siderably, than stock remaining of last year’s crop. With less
stringent money conditions and cooler weather canned goods
may show improvement. Grocery imports have increased stead­
ily, coffee leading with an increase of 35 per cent thus far this
year, over 1919. This increase in supply is undoubtedly one of the
causes for the decline which has taken place in that commodity.
Rice has also suffered a serious decline, though at present the
trade is dull with the export outlet virtually neglected for weeks.
Tea conditions remain practically unchanged with the sellers un­
willing to make further concessions. Developments in the flour
market have undermined confidence in prevailing prices. Buying
is 3till conservative, although numerous export inquiries are being
received from to time.
Transportation conditions are good from points east, but
poor from points west of Harrisburg. Even from Philadelphia
to the interior points west the conditions are generally poor, but
as a whole they are improving with the carriers seemingly anx­
ious for business and arranging for better and prompter service.
W H OLESALE G R O C E RY T R A D E

Per cent increase or
decrease for
A ug. 1920 Sept. 1920

1. Net sales (selling price) during month
a. As compared to previous m onth.....................................
b. As compared to same month, 1919.................................

— 29.4
— 3.0

— 14.1
+ 5.6

2. Accounts outstanding at end o f month (selling price)
a. As compared to previous m onth.....................................
b. As compared to same month, 19 1 9 ...............................

— 48.8
+ 7.8

-f*
+

3. Ratio o f accounts outstanding at end o f month to net
sales during m onth...................................................................

..........

2.6
9.2
88.1

LEATHER AND SHOES
Shoe salesmen unable to book orders

The difficulties which shoe salesmen are meeting in their
efforts to book orders for next spring’s styles are causing con­
siderable anxiety in the industry. Manufacturers report very
meagre returns from their men, and many have already been, or




21

shortly will be, called in from the road. There is no disposition
on the part of jobbers and retailers to place orders in advance.
Indeed, even the hand-to-mouth business is exceptionally small
in volume.
The lack of interest on the part of the retailer is generally
felt to have been caused by the refusal of the consumer to take up
stocks at any price. When fall shoes first made their appearance
they were marked at prices on a par or very little below those of
last fall. The failure to move their stocks caused the dealers
to resort to numerous sales. But the continuance of the warm
weather, and the determination of the public to refrain from
buying until prices conform with their ideas on the subject, have
caused the reduction sales to fail of the expected results. The
retailer, therefore, is placing no orders, and will not, it is said,
until a buying movement on the part of the public develops.
One manufacturer explains the present lack of demand from
the supply standpoint and puts as much stress for this situation
upon the manufacturer as upon the retailer. When prices were
exceptionally high, he says, manufacturers in their eagerness
to do all the business possible oversold their plant capacity to
the extent of four or five months. The retailers, fearing advanc­
ing prices, plunged in and bought far in excess of their needs.
When the break in the market came manufacturers were months
behind in their orders, and the retail merchant, already heavily
stocked, was forced to cancel. Manufacturers, however, were
compelled to continue operations on the partly finished goods,
and when these were completed, made big concessions in order
to dispose of them. The heavy stocks which retailers therefore
had and the cessation of buying on the part of the public seems
to show, he says, that retailers are overstocked and for this reason
are placing no orders. It is the general opinion that no large
orders for spring goods will be placed before the end of Jan­
uary or early February. That the fall season of course is lost
irretrievably is expressed by many manufacturers.
From the producing standpoint, conditions are entirely satis­
factory; the labor situation continues to improve, transportation
is better, and the raw material supply is sufficient for all require­
ments and trending lower in price. As a result of this decline
in basic materials, the prices for the finished shoe are being
variously quoted at from 30 to 50 per cent below the high level
of the early part of this year, but are still considerably in excess
of pre-war prices and must remain at present prices, it is said,
unless wages are reduced.




22

Leather industry reflects lack o f demand fo r shoes

As a result of the almost total absence of activity in the shoe
manufacturing industry, conditions in the leather trade are cha­
otic. Tanners report an absence of demand for their product,
which, following the increasing lack of interest of the last few
months, is now at its lowest ebb. Both sales of finished stock
for immediate use and orders for future delivery are decreasing
and all concessions in prices fail to stimulate the trade. The
prices generally quoted are from 50 to 70 per cent below the peak
prices of the business boom of early 1920, but are approximately
double the figures of 1914. A manufacturer by shopping about,
however, is able to secure leather at practically his own price.
The causes to which tanners attribute present conditions are
numerous and include the stringent money conditions, the for­
eign exchange situation, the inevitable reaction from the high
prices caused by war conditions, newspaper propaganda against
high prices, the work of the Department of Justice and fair price
commissions, the refusal of retailers to share in the loss of man­
ufacturers, and the exceedingly large supply of hides and skins.
One manufacturer traces this large volume of skins to the high
price of cereals. The farmers, he says, have found it unprofit­
able to raise every calf into a larger animal and have therefore
slaughtered more calves than would have been the case under
more normal food prices.
Stocks o f hides heavy

A plethoric condition exists in the hide markets, and with
the absence of demand on the part of tanners the situation may
be said to be even worse than in the manufacturing lines. Prices
have continually fallen and in some instances are very close to
those of 1914. No turn for the better is looked for in hide
circles until the manufacturing of shoes and other leather articles
is resumed on a large scale.
TOBACCO
Tobacco, while it may be regarded as a luxury, is holding its
own in the face of declining prices in other commodities. The
volume of sales does not show much increase, but the balance
between demand and ability to supply is well maintained. Cigar
factories on the whole are working close to capacity.
There has been a wonderful crop harvested this year as re­
ported by the United States Department of Agriculture. The




23

condition of the tobacco crop in Pennsylvania on October 1 was
97 per cent of normal, indicating a yield of 1,552 pounds per acre
and a production of 59,131,000 pounds as compared with 54,500,000
pounds last year, and an average production for the past ten years
of 55,704,000 pounds.
Cigar manufacturers are not experiencing much difficulty in
securing domestic tobacco at prices which prevailed last year.
On the other hand, imported goods, such as Sumatra wrappers,
Havana fillers, as well as Porto Rico tobacco, show a hardening
tendency.
Our exports of cigarettes in June were 1,718,026,000, a gain
of 9.3 per cent over June, 1919, and for the 12 months ending
June, 1920, exports amounted to 17,547,371,000, an increase of 28
per cent above the preceding twelve months. Cigars and cheroots
exported in June were 4,325,000, a decrease of 47 per cent from
June, 1919, and exports for the twelve month period were 66,874,000, a gain of 101 per cent over the preceding twelve months and
346 per cent over the corresponding period two years ago. Leaf
tobacco exported in June amounted to 28,041,064 pounds, a de­
crease of 71 per cent compared with a year ago. For the twelve
months ended with June, leaf tobacco exports totaled 632,773,620
pounds.
Prices for the finished product are reported to be holding up
remarkably well. The trade reports satisfactory collections, and
that the. transportation situation has improved materially. It is
stated also that jobbers are adopting a more conservative attitude
in buying.
FINANCIAL
On October 15, the loans of the Federal reserve banks were
$3,093,390,000, which compared with a peak of $3,101,361,000 on
the preceding Friday and $2,805,818,000 on January 2. Bills dis­
counted, other than those secured by Government war obliga­
tions, have increased steadily since the beginning of 1920. In
keeping with the increase in loans, Federal reserve note circula­
tion reached a record point of $3,353,271,000, on October 15, an in­
crease in the course of the month of over 60 millions and of over
350 millions since the beginning of the year. The reserve ratio
declined slightly to 42.7 per cent.
Loans of member banks in the Philadelphia Federal Reserve
District also show an increase since the beginning of the year.
The statements of 56 institutions which have reported to us on
January 2 and October 15, show an increase of $22,155,000 in total




24

loans and investments, or 2.6 per cent. This is made up as fol­
lows: Loans secured by United States securities and United
States securities owned decreased $70,413,000 during that period
but all other loans and investments increased $92,568,000. Total
deposits, including Government deposits, increased 1.3 per cent.
Saving deposits in 24 savings institutions scattered through­
out the district gained slightly during September; the slow rate
of increase is reflected by the table given below:
Outside Philadelphia

1919........... .............$46,161,124
1920........... ............. 49,320,000
July,
“
........... ............. 49,575,000
August,
“
........... ............. 49,398,925
Septem ber, “
........... ............. 49,407,882
O ctob er,
“
........... ............. 49,847,933
O ctob er,
June,

Philadelphia

Grand Total

$225,706,991
242,015,060
241,639,724
242,087,992
242,265,851
242,304,419

$271 868,265
291,335,060
291,214,724
291,486,917
291,673,733
292,152,352

A V E R A G E M O N T H L Y D E B ITS T O IN D IV ID U A L A C C O U N T

Debits to individual account at the banks which are members
of more than 150 clearing houses throughout the country averaged
$8,426,000,000 weekly during the month of August. This average
was the lowest of the year and during September it increased to
$8,552,000,000, possibly due to large tax payments. Inasmuch as
these debits are the totals of the charges to the accounts of indi­
viduals, firms, corporations and the United States Government,
they are fairly accurate indicators of business volume if not dis­
turbed by large financial operations such as the payment of taxes.




25

C O M B IN E D S T A T E M E N T
o f the Twelve Federal Reserve Banks
( 0 0 0 ’ » o m it t e d )

RESOURCES

Oct. 15, 1920

Gold reserve......................
Legal tender, silver, etc..

$1,992,101
162,810

$1,973,127
160,018

$2,128,443
70,742

Total reserve............

$2,154,911

$2,133,145

$2,199,185

$1,202,593
1,306,610
321,605

$1,698,885

Bills bought in open market

$1,192,810
1,581,060
319,520

Total bills on hand ..
United States securities..

$3,093,390
328,586

$2,830,808
420,353

$2,464,665
296,598

Total earning assets

$3,421,976

$3,251,161

$2,761,263

Bank prem ises..................
Uncollected item s............
5% r e d e m p t i o n fund
against Fed. res. bank
n otes...............................
All other resources..........

$15,766
998,488

$15,263
1,097,408

$13,336
1,162,167

12,158
6,951

12,024
4,660

12,331
13,530

Total resources........

$6,610,250

$6,513,661

$6,161,812

Oct. 15, 1920

Month ago

Year ago

Month ago

Year ago

Bills discounted:
Secured by Governm ent war
obligations..........................
All oth er...................................

LIABILITIES
Capital paid i n ..................
Surplus...............................
Government deposits . . . .
Due to members—reserve
account............................
Deferred availability items
Other deposits, including
foreign g o v e r n m e n t
credits..............................
Total gross deposits..
Federal reserve notes in
actual circulation..........
Federal reserve bank notes
outstanding-—net liabilh y ...................................
All other liabilities...........
Total liabilities........




422,842
342,938

$97,594
164,745
13,975

$97,366
164,745
135,178

$85,540
81,087
133,639

1,868,016
776,887

1,821,833
676,275

1,841,101
882,156

33,740

42,409

101,430

$2,692,618

$2,675,695

$2,958,326

$3,353,271

$3,289,681

$2,752,569

213,533
88,489

212,219
73,955

249,675
34,615

$6,610,250

$6,513,661

$6,161,812

26

RESOURCE

AND

LIABILITY

ITEM S

o f member banks
in Philadelphia, Scranton, Camden and Wilmington
At the close of business
Oct. 15, 1920 Sept. 17, 1920 Jan. 2, 1919

| Inthousands of dollars—~
~
|
L i.e., ooo’s omitted. J
U n ited States bonds to secu re c ir c u la t io n ..

$11,347

$11,347

$11,097

O th er U n ited States bonds and n o t e s .........

38,087

38,197

41,512

C ertificates o f indebtedness ..........................

26,701

20,834

60,581
$113,190

T o ta l U n ited States secu rities ow ned

$76,135

$70,378

L oan s secu red by U n ited States S ecu rities

36,811

40,861

68,428

A ll oth er loans and investm ents ..................

777,848

777,961

678,237

T o ta l loans and investm ents .................

$890,794

$889,200

$859,855

R eserve w ith F ederal R eserve B a n k ...........

73,260

67,394

59,492

Cash in vault .........................................................

17,123

19,012

21,027

N et dem and d eposits on w hich reserve is
com pu ted ..................................................

693,119

694,606

668,657

T im e d eposits .......................................................

39,435

39,012

22,651

G overnm ent d ep osits

.......................................

20,692

21,685

43,376

N um ber o f rep ortin g b a n k s............................

59

59

56

CHARGES

TO

D EPO SITO R S’ A C C O U N T S

other than banks’ or bankers’ , as reported by Clearing Houses
Weeks ending
Oct. 2 2 , 1 9 20

Sept. 2 4 , 1920

Oct. 2 4 , 1920

$3,612,000

A ltoon a

.........................

$3,100,000

Chester

..........................

6,053,000

5,504,000

2,137,000

4,075,000

H arrisburg

...................

J oh n stow n
L an caster

4,733,000

P h iladelphia

6,580,000

................

3,404,000

6,367,000

6,235,000

354,138,000

....................
...................... ...........

377,703,000

R eading

.........................

4,651,000

4,555,000

Scran ton

........................

14,603,000

12,622,000

T ren ton

.........................

16,528,000

11,093,000

9,095,000

7,776,000

5,067,000

3,690,000

W ilk es-B a rre
W illia m sp o rt

10,891,000

.............

8,206,000

10,615,000

.............................. .............

5,479,000

4,511,000

4,303,000

........................ .............

$501,270,000

$439,189,000

$455,187,000

W ilm in g to n
Y o rk

............. .............

T o ta ls




...............

27

IN D IC A T O R S
Percentage increase or decrease
com
pared w
ith
Previous month

%

Federal Reserve Bank:
Discounts and collateral loans..........
Reserve r a tio .......................................
90-day discount rate...........................

$172,050,000
51
6

%
%

6
49
6

%
%*
%*

8

%

8

%*

Commercial paper rate...........................

—
+

—

1 %
4 %
107 % *

—
+

4
S'Afr*

Previous month

Year ago

Bank clearings:
In Philadelphia.....................................
Elsewhere in district............................

$ 2 ,0 5 3 ,3 7 9 ,1 8 7

+

3

%

1 2 6 ,0 0 7 ,5 9 5

+

4

%

Total clearings.................................

$ 2 ,1 7 9 ,3 8 6 ,7 8 2

+

3

%

+

11

%

7

fa

$ 2 ,6 8 7 ,2 9 5

+

26

2 5 1 .8 1 7
$ 2 3 7 ,3 4 1
$ 1 6 .9 0 9 4

^Actual figures.




—

$ 1 ,3 2 8 ,8 8 4

Latest commodity index figures:
Annalist (food prices o n ly )................
Dun’s .....................................................
Bradstreet’s ...........................................

28

%
%
fa*

Percentage Increase or decrease
com
pared w
ith

Sept., 1920

Building permits, Philadelphia.............
Post office receipts, Philadelphia..........
Commercial failures in district
(per Bradstreet’s ) ...............................

8
1
114

1

$744,987,000
717,706,000
104

O

Philadelphia banks:
L o a n s.....................................................
D eposits.................................................
Ratio o f loans to deposits..................

Year ago

*

Oct. 18, 1920

H
-

B U S IN E S S

31

—
—
—

-f

7 °/
o
6

%

7

%

— 49
+ 21

%

*

%

28

6 .1 %

—

2 .8 %

+

0 .6 %

6 .2 %

—

1 3 .4 %

1 0 .7 %

*

ON THE HORIZON
Resources of all banking institutions in the United States
totalled 53 billion dollars on June 30, 1920, according to a state­
ment of the Comptroller t>f the Currency. This figure is said to
be in excess of the combined bank assets of all other leading
nations of the world. Total loans and discounts were $30,891,000,000, an increase of $5,805,000,000 over June 30, 1919, and total
deposits were $41,714,000,000, an increase of $4,045,000,000 in the
same period.
V
In his annual report, President R. S. Hance, of the American
Bankers’ Association, makes the following comments with regard
to the Federal reserve system:
“A review of the year just passed would be incomplete with­
out comment on the Federal reserve system and its activities.
Regardless of whether we criticise details of operation, or agree
in all rulings of the Board, we must admit that the Federal re­
serve system has proven its sound fundamental principles and
rendered a service to the country for which all citizens should
be grateful and bankers should realize and appreciate.”
Professor Irving Fisher’s plan for stabilizing the dollar was
condemned by the currency commission of the Association, after
exhaustive investigation.

In its resume for the year 1919, the National Automobile
Chamber of Commerce cites the Farm Journal to the effect that
of the 7,558,000 cars in use, 2,366,000 were farmer owned, or
nearly one-third of the total registration.
While motor vehicles increased 1,313,000 during the year,
the total number of horses decreased from 21,555,000 to 21,482,000.




29

It requires five acres to feed a horse. The replacement of motor
power for the remaining animal power would release for food
purposes over 100,000,000 acres or nearly the total corn acreage in
the United States.—" Facts and Figures of the Automobile In­
dustry”
¥
At the convention of the Atlantic Deeper Waterways Asso­
ciation much was said in favor of a deep canal at sea level across
New Jersey. Mayor Donald, of Trenton, said in part: “ The
time has come to join the Delaware with the Atlantic with a sea
level canal across Jersey! One year after this New Jersey canal
is completed it will carry more tonnage in one year than the
Panama Canal in ten years. We did not hesitate in the case of
the Panama cut. Why should we halt now with a great national
proposition?”
Lewis Nixon, of New York, said the railroads must stop an­
tagonizing waterway development because canals will supple­
ment rail service by taking from them much that they carry at
a loss, only to be compensated by charging higher on other
freight.

Vessels of the United States Shipping Board carried 13,379,234 tons of export merchandise and 7,236,168 tons of imports dur­
ing the fiscal year ended June 30 last, according to a statement
of Shipping Board activities. The cargo carried, the report
states, constituted 30 per cent of the country’s export business
and 27 per cent of the imports, the percentages being fixed on the
return of the total foreign commerce of the United States for the
fiscal year.
The business of the Shipping Board was handled through
forty-nine American ports, New York ranking first with 23.2
per cent of the exports and 36.6 per cent of the imports, or 27.9
per cent of the total business. Baltimore and Philadelphia
ranked second, each with 10 per cent, and New Orleans third with
7.6 per cent.
IS
The official reports of the Comptroller’s office show that the
huge issues of Liberty and Victory obligations issued since the
outbreak of the war are being steadily absorbed and digested by




in




WORLD REO/STRAT/O A/ OF CARS

PROPORTIONAL TO POPULATION

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6.750,000

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•

* *

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-

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2000-3000 ‘
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permanent investors and that the amount of these bonds, upon
which money is being loaned by the banks is being constantly
reduced.
The amount of Liberty bonds owned by the national banks
on June 30, 1920, was only $778,361,000, a reduction since Decem­
ber 31, 1919, of $64,811,000. The amount of Victory notes owned
by the same institutions on June 30, 1920, was $249,615,000, a
reduction of $54,574,000 since December 31, 1919. As the total
resources of the national banks on June 30 last amounted to
$22,196,000,000, we find that on the date named they had only
three and one-half per cent of their total resources invested
in Liberty bonds, and one per cent additional in Victory notes.

8

* ?

America’s spurt in shipbuilding during the war has turned
into a sharp decline, and at present England, which was 1,931,000
gross tons behind at the end of the first quarter of 1919, is shown
to be 1,959,000 in the lead. These figures were made public in a
statement from Lloyd’s Register of Shipping. On the present
reduced scale of output the American yards show an increase of
1,097 per cent over the total under construction just prior to the
war. Britain’s gain in the same period represents only 116 per
cent over the production in the pre-war period. As the yard re­
ports showed on September 30, Britain has 3,731,000 gross tons
building while the United States could report only 1,772,000.
However, in certain angles of the construction business, this
country holds a good lead. Returns made to Lloyd’s Register
show that the United States is meeting the demand for tankers
with a remarkable output. Briefly, the American shipbuilder
is launching more than double the number of ships of this class
under construction in Great Britain and the rest of the world
together.—New York Sun.
*

8?

C O M P IL E D A S O F O C T O B E R 22, 1920

This business report 'will be sent regularly to any address upon request.




32


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102