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THE BUSINESS REVIEW THIRD FEDERAL PHILADELPHIA RESERVE DISTRICT SEPTEMBER By RICHARD L. AUSTIN, Chairman and Federal Reserve i, i933 Agent FEDERAL RESERVE BANK of PHILADELPHIA Business and Banking Conditions in the United States Industrial production increased fur ther from June to July, contrary to seasonal tendency, and in recent weeks has continued at a relatively high level. Since the middle of July there have been reductions in wholesale prices of leading raw materials while prices of many other products have advanced. Volume of industrial output, as measured by the Board’s seasonally adjusted index, advanced from 91 per cent of the 1923 1925 average in June to 98 per cent in July, which compares with 60 per cent in March. The principal increase in July was at steel plants where ac tivity advanced from 46 per cent of capacity to 59 per cent. Production in the lumber and coal industries was also in larger volume and daily average output of automobiles showed none of the usual seasonal decline. Output at shoe factories and woolen mills con tinued at an unusually high rate while consumption of cotton by domestic mills decreased somewhat. Cigarette production declined sharply from the high level of May and June. Since the middle of July a decrease has been reported in the output of steel. Working forces and payrolls at fac tories increased considerably between the middle of June and the middle of Production and employment. INDUSTRIAL PRODUCTION PM tw 110 120 110 100 90 80 70 60 50 W28 1929 1930 1931 ~ 1932 ........ mo 130 120 110 100 90 80 / 70 60 1 50 1933 Index number of industrial production, ad justed for seasonal variation. (1923-1925 av erage = 100.) July. As in other recent months the largest increases were generally at es tablishments fabricating raw materials into semi-finished products. Value of construction contracts awarded, as reported by the F. W. Dodge Corporation, showed a decline in July followed by an increase in the first half of August. Total awards during the six weeks were in about the same volume as in the preceding six weeks and in larger volume than in earlier periods this year. Department of Agriculture estimates as of August 1 indicate harvests gen erally smaller than a year ago. The cotton crop is forecast at 12,314,000 bales, a reduction of 700,000 bales from last season, reflecting curtailment in acreage as a part of the program of the Agricultural Adjustment Ad ministration, offset in large part by an unusually high yield per acre. The wheat crop is estimated at 500,000,000 bushels, a reduction of 225,000,000 bushels from last year’s small harvest, and feed crops are expected to be un usually small. somewhat smaller. Department store sales declined in July by about the usual seasonal amount; they were larger than a year ago, however, and trade reports for the first half of August indicate an increase in sales. Wholesale prices. Wholesale prices of commodities increased further dur ing the first three weeks of July and, according to the index of the Bureau of Labor Statistics, there has been little change in their general level since that time. Prices of grains, cotton, and many imported raw materials, however, were considerably lower in the third week of August than in the middle of July while prices of textiles were higher, reflecting in part the ap plication of the processing tax on cot ton. Prices of leather and coal also advanced during this period. PEH «NT F/ iCTORYE MPL0YMENT AND PAYROLLS ... GMT 100 90 Payrolls'. f \ \ VI Freight traffic increased further from June to July by a sub stantial amount, but in recent weeks shipments, particularly of miscellane ous freight and grains, have been “A ^ Distribution. CONSTRUCTION CONTRACTS AWARDED \/\ 30 1928 1929 1930 1931 1932 7 'v"- - - - 1933 Indexes of factory employment and payrolls, without adjustment for seasonal variation. (1923—1925 average =100.) BILLIONS OF DOLLARS MEMBER BANK CREDIT MEMBER BANK CREDIT Investments All other Loans Loans on Securities Indexes based on three-month moving aver ages of F. W. Dodge data for 37 Eastern States, adjusted for seasonal variation. (1923-1925 av erage = 100.) Wc£n*»day figures for reporting member banks in 90 cities. Latest figures are for Wednesday, August 16. Page One In the exchange market the value of the dollar in terms of the French franc advanced from a low of 69 per cent of its gold parity on July 18 to 75 per cent at the be ginning of August and since that time has fluctuated between 73 and 75 per cent. Foreign exchange. Net demand deposits of weekly reporting member banks in 90 cities declined between the middle of July and the middle of August, owing in large part to further with Bank credit. drawals of bankers’ balances from banks in New York City and else where. The banks’ loans decreased by $71,000,000 during the period, reflect ing chiefly a reduction in loans to brokers and dealers in securities. Their holdings of United States Government securities, after declining between July 19 and August 9, increased during the week ending August 18 in connec tion with Treasury financing at that time. Total reserves of all member banks increased by $81,000,000 during the four-week period ending August 16, reflecting chiefly the purchase of $42,000,000 of United States Govern ment securities by the reserve banks and a return of $23,000,000 of cur rency from circulation. The growth in member bank reserves, occurring at a time when reserve requirements were being reduced in consequence of a decline in their deposits, brought their excess reserves to a level above $550,000,000. Money rates in the open market generally continued at low levels. Business and Banking Conditions in the Philadelphia Federal Reserve District Industrial activity in July showed further expansion, but since then oper ations have slackened noticeably, re flecting partly seasonal influences and partly a period of hesitation with re spect to future commitments pending the readjustments of such important factors as wages, hours of work, and prices of raw materials and finished products. Output of factories and mines reg istered exceptional increases, consider ing that July is usually the low month in point of production; in early August operations slackened a little. Activity in building trades has expanded further and contract awards show additional gains, but the general level of oper ation in this industry continues exceed ingly low as compared with other years. There was a marked improve ment in the wholesale and jobbing trade, while sales at retail declined more than usual during July, but in both instances they were larger than a year ago; in August mercantile trade showed improvement, particularly in retail trade sales. Collections at retail, wholesale and in manufacturing have continued more satisfactory than last year. Commercial failures have de clined greatly both in number and in the amount of liabilities as compared with the previous month and a year ago. Industrial employment has been in creasing steadily for four months, following a sharp decline at the turn of the year. Payrolls, which reached the record low level in March, have risen even more sharply than has employment, so that in July the spread between the two indexes was quite small. Our index number of general employment, which is based on twelve manufacturing and non-manufacturing occupations in Pennsylvania employ ing about 61 per cent of all working persons in that state, showed an addi tional gain of 3 per cent in the num ber of workers and over 5 per cent in the amount of weekly wage earnings in July over June, the largest increases occurring in mining and manufactur ing. Compared with a year ago, the general employment index was 7 per cent and the payroll index 14 per cent higher. Manufacturing. Buying of finished goods directly from factories in this district has fallen off somewhat, fol lowing an unusual rise in the rate of activity from March through July. While current sales continue to exceed materially those of last year, new or repeat orders have not been as volumi nous as they had been prior to August. Behind this let-down there is notice able a marked degree of uncertainty brought about by the rise in costs of production, distribution and the re placement of merchandise largely un der the industrial recovery act. The volume of unfilled orders at about the middle of August was smaller than in the previous month in most of the reporting establish ments ; it appears to be large enough, however, to assure production for sev eral weeks at a considerably higher RETAIL TRADE SALES MANUFACTURING ACTIVITY PHILADELPHIA FEDERAL RESERVE DISTRICT PHILADELPHIA FEDERAL RESERVE DISTRICT PERCENT PERCENT SHOE STORES PRODUCTION APPAREL I STORES EMPLOYMENT DEPARTMENT STORES PAYROLLS 1929 1930 Digitized Page Two for FRASER 1931 1932 1933 1934 1928 1929 1930 1931 1932 1933 rate than last year. It must be remem Business Indicators bered that this is usually a dull period Philadelphia Federal Reserve District in point of additional buying, since seasonable merchandise hardly starts moving before the middle of August. Index numbers expressed in percentages of 1923-1925 average, which is taken as 100 Compared with a year ago, the present Adjusted index numbers make volume of forward business is appreci allowance for the usual seasonal Adjusted for seasonal variations Not adjusted ably larger. even distribution of business be ! Shipments of finished goods from tween the months of the year. Percentage com parison manufacturing plants to various inter Unadjusted indexes reflect merely the actual changes which July June mediate points of distribution have July 1933 7 July July- June Julymay or may not be up to the with months 1932 1932 1933 1933 1933 1933 been unusually large so that inventories usual seasonal expectations. 1933 with 7 appear to be smaller either as com Month Year months pared with the preceding months or 1932 ago ago last year. Stocks of raw materials and semi-manufactured products, on the Industrial production: output of factories and coal mines. . . 55.3 68.8 72.2p + 4.9 +30.6 + 0.0 52.8 67.9 68.5p other hand, have continued increasing, Manufacturing—total................... 55.4r 69.1 72.5p + 4.9 +30.9 0.0 though lately at a slower rate than 53.6r 68.8 69.5p Metal products........................... 27.8r 43.8 54.0 +23.3 +94.2 - 6.2 27.Or 44.3 51.2 was the case earlier in the season. Textile products........................ 60.9 94.9 95.4p + 0.5 +56.7 +23.4 56.7 92.9 89. Op Transportation equipment.... 49.9r 30.7 32.4 + 5.5 -35.1 -45.7 48.8r 31.2 31.5 Reports from representative manu h ood products............................. 68.7r 72.5 74.4p + 2.6 + 8.3 - 4.8 68.Or 71.3 71.8p Tobacco and products............... 79.8r 84.0 83.5 - 0.6 + 4.6 + 1.0 86.0 90.7 89.9 facturers indicate a continued rise in Building materials..................... 22.3r 28.8 32.1 + 11.5 +43.9 -23.7 24.2r 31.6 34.5 wholesale quotations for their prod Chemicals and related products 89.6 97.2 101.5p + 4.4 + 13.3 - 1.5 88.5 97.7 99.6p Leather and products............... 93.1 124.5 139,3p + 11.9 +49.6 +17.4 84.3 121 .6 126.3p ucts, reflecting largely increased costs Paper and printing.................... 81 . 3r 82.5 83.7 + 1.5 + 3.0 - 7.7 78.8r 81.7 81.1 Electric power output............... 167.5 182.8 182.2 - 0.3 + 8.8 - 3.9 155.8 173.7 169.4 of material and labor. National figures Elec. pwr. used by industries. . 111 .9 126.5 141.5 + 11.9 +26.5 - 1.7 114.1 127.8 144.3 show that the general level of prices, after advancing sharply for about four 57! 6 55^0 Anthracite... 55.0 65.0 67.0 + 3.1 +21 ^8 - 1.7 45.0 Bituminous.................................. 47.8 69.0 81.6 + 18.3 +70.7 + 15.0 42.1 60.7 71.8 months, has steadied itself somewhat since the middle of July. In the manu facturing group, hides, leather and + 7.9* +36.4* -13.2* 33.2 42.Op 45.3p textile products showed the largest in Building and real estate creases, and this advance continued Contracts awardedt—total... 30.3 15.5 18.2 + 17.4 -39.9 -42.8 32.7 19.1 19.7 through the first two weeks of Contracts awarded!—residential 18.0 11 .8 16.4 +39.0 - 8.9 -46.1 18.0 14.3 16.4 Permits for building...................... 6.1 + 8.9 +38.6 -40.5 5.6 4.4 5.4 7.5 6.9 August. Mortgages recorded in Phila. . . . 21.1 18.0 +30.4 -14.7 -49.6 13.8 23.0 12.4 19.6 Real estate deeds recorded in Collections show further improve Philadelphia................... 69.8 50.4 52.3 + 3.8 -25.1 -18.9 69.1 54.4 51.8 ment. Additional gains in payments Exclusive of Sheriff deeds (1930=100)............................. + 3 2* have been numerous and the total Sheriff deeds (1930= 100)........ -10.7* + 15 4* + 5 3* 141 3 163 0 Writs for Sheriff sales in Phila. .. 1092.9 1481 .9 1126.1 -24.0 + 3.0 + 2.8 1038.3 1481.0 1069.8 amount of settlements has been appre ciably larger than last year, partly be Distribution cause of increased volume and higher Retail trade—sales .. 56.6 r 60.3 57,9p - 4.0 + 2.3 -15.0 41.4r 58.9 42.2p 54 .9 prices. + 33 13 4 Wholesale trade—sales................. 56.6 r 70.0 74.3p + 6.1 +31.3 - 0.5 52.Or 66.7 68.4p Factory employment in this district Wholesale trade—stocks . . 66.0 57.9 57.6p — 12.7 65 0 55.9r 56.6p Freight car loadings (Allegheny showed a further increase of over 4 57.1 Life insurance sales................... 100.3 ooio 96.7 + 7.4 - 3 i 6 - 0.7 96.3 93.6 92.8 per cent and payrolls 8 per cent from New passenger auto registrations 44.6 61.1 73.0 +19.5 +63.7 - 3.5 50.4 85.6 82.5 June to July, continuing the upward trend since early April. Operating Business liquidations time, as indicated by man-hours -75.8* —4916* 255.0 118.7 61 i8 worked, also expanded but at a some what slower rate than did wage earn Payment of accounts Check payments........................... 65.3 59.3 69.0 + 16.4 + 5.7 - 9.4 ings, the difference being due to numer 63.3 61.7 66.9 Rate of collections (actual, not indexes) ous advances in wage rates. In August Retail trade................................. — 2.2* +12 1* there have been additional increases in Wholesale trade.......................... - 2.8* + 11.9* 53.7 61.8 the number of wage earners and pay .... . _.... rolls, reflecting in large measure the Per cent change from (000,000’s omitted readjustment of wages and working Julv April May June July in dollar figures) 1932 1933 1933 1933 1933 hours in accordance with industrial Month Year codes which are being adopted by in ago ago dustries. and credit In Pennsylvania manufacturing in Banking Reserve Bank Federal Bills discounted........................ $ 72 dustries, the average number of wage $ 56 $ 46 $ 39 $ 34 -12.8 -52.8 Other bills and securities .... 141 144 141 143 + 2.1 146 + 3.5 earners in July increased by about Reporting member banks 100,000 and the weekly average pay Loans to customers................. 608 534 521 514 504 - 1.9 -17.1 Open market loans and invest roll approximately by $17,000,000 as ments ....................................... 455 458 468 485 512 + 5.6 + 12.5 compared with record low points in Net demand, time and gov ernment deposits.................. 892 862 871 898 921 -f 2.6 + 3.3 March this year and in July last year, Bankers' acceptances outstand ing ............................................ 12.6 10.0 9.9 11.9 13.0 + 9.2 + 3.2 according to estimates based on reports from plants which in 1929 employed * Computed from data unadjusted for seasonal variation, p—Preliminary, nearly 61 per cent of all factory wage t Three-montn moving daily average. r—Revised. Page Three IRON AND STEEL PRODUCTION REAL ESTATE-PHILADELPHIA PHILADELPHIA FEDERAL RESERVE DISTRICT PERCENT PERCENT SHERIFF DEEDS » RECORDED STEEL fl ? PIG IRON • V* OTHER DEEDS 1928 1929 1030 1931 1932 1930 1933 earners in that state. While the rela tive gain in employment during this period has been somewhat less pro nounced in Pennsylvania than in the country as a whole, reflecting probably lower levels formerly prevailing in other industrial states and existing labor difficulties in this state, the per centage increase in wages paid in July was almost identical with that for the United States; compared with July 1932, wage earnings in Pennsylvania were 36 per cent larger, while in the country the increase amounted to about 29 per cent. Output of factory products has con tinued sharply upward for four suc cessive months, reaching lately the highest level since the fall of 1931. This bank’s index number of produc tion, which is adjusted for the number of working days and seasonal fluctua tion and is based on reports from 45 industries whose value added by manu facture is about two-thirds of the total, again rose from 69 in June to 72 per cent of the 1923-25 average in July; a year ago this index was 55, which was the lowest monthly figure in the past decade, with the exception of last March. This advance in the past four months amounted to almost 40 per cent. Because of the expansion in working time and increases in wage rates, factory payrolls, but not employ ment, virtually paralleled the percent age increase in production. The ac companying table indicates that the largest gains, just as the largest losses in the depression period, occurred in the output of durable or capital goods such as fabricated metals, transporta tion equipment and building materials. The largest exceptional gains dur ing the month occurred in the activity of the iron and steel, leather, building material and electric power industries. The small change in the output of textile products may be attributed to labor difficulties in such branches as hosiery and women’s clothing, the two industries which normally employ about 5 per cent of all factory wage earners in Pennsylvania. Strikes in other industries also have hampered the production of finished goods. Nevertheless, a great majority of indi vidual lines registered additional in creases during July and extraordinarily large increases as compared with last year. ---------------c------------------------------Percentage change in July 1933 compared with— March 1933 July Average 1932 1925-1928 Production, total.............................................. Durable or capital goods........................... Consumers' goods......................................... +40.2 +69.9 +21.7 +30.9 +39.7 Employment, all industries............................ Durable or capital goods........................... Consumers’ goods......................................... + 16.0 Payrolls, all industries..................................... Durable or capital goods........................... Consumers' goods......................................... trie 1 WES little power only a smaller in July j^an jn June but jts consumption -30 6 by industries rose -51.4 about 12 per cent +28.4 + 9.7 +16.2 + 16.7 + 18.8 I40 .9 reaching the high -13.2 est +39.4 +79.7 + 17.4 +36.4 +65.0 +20.8 —so ■? — 58.4 1930. +27.1 in -38.2 Note: To obtain comparable changes, the same type of industries have been selected for factory production, employment and payrolls. Page Four 1932 t 1933 Source: Philadelphia Real Estate Board. Source: Iron Age. Production is for the Philadelphia Federal Reserve District. Employment and payrolls are for Pennsylvania. 1931 the ievei month, since The use of power by munici- ircdhcu while vv 11 1 i c sales for transportation, residential and commercial, and other purposes declined. Compared with a year ago, total sales for all purposes were 16 per cent larger. Coal. Demand for anthracite by householders has been somewhat more active lately in anticipation of a further rise in retail prices scheduled for Sep tember 1. Output of collieries de clined less than seasonally in July, fol lowing an unusually sharp increase in the preceding month. In the first half of August production showed sbme gain. Shipments of *hard coal de creased somewhat during July, al though they exceeded those of a year ago by nearly 18 per cent. Demand for Pennsylvania bitumi nous coal showed a noticeable in crease between the middle of July and the middle of August, reflecting partly some further increases in manufactur ing activity and partly a threatened shortage of industrial fuel occasioned by labor difficulties, which in early August curtailed the output of several collieries. Contrary to seasonal ex pectation, production of bituminous coal in Pennsylvania increased sharply in July, and was the largest for that month since 1930. Although activity in the construction and con tracting industry in Pennsylvania showed some further expansion from the middle of June to the middle of July, the rate of gain was less than in earlier months this year. Reports from approximately 1,400 contractors showed gains in July of 2 and 1 per cent, respectively, in the number of workers employed and in their earn ings ; operating time in this period in creased less than one per cent. Building and real estate. FREIGHT CAR LOADINGS SALES OF NEW PASSENGER AUTOMOBILES ALLEGHENY DISTRICT PERCENT MERCHANDISE AND / MISCELLANEOUS .* tf UNITED STATES TOTAL PHILADELPHIA FEDERAL RESERVE' I DISTRICT APJU3TC0 TOR SEASONAL VARIATION 1928 1929 1930 1932 Source: American Railzvay Association. Continuing the upward trend since March, aggregate awards of buildingcontracts increased in July, instead of declining as is usual in that month. Contracts let for residences increased noticeably from June to July and were the largest of any month since May of last year. Although the average of total awards for the three months from May through July showed a further substantial increase, it was nearly 40 per cent lower than a year ago. In early August, contract awards de clined seasonally. Estimated cost of proposed building under permits issued in 17 cities of this district increased in July, follow ing an unusually sharp decline in the preceding month. Although the dol lar volume of permits issued in July for new construction, repairs and al terations exceeded that of a year ago by nearly 39 per cent, the total for the seven-month period this year shows a drop of over 40 per cent from a year ago. Developments in the local real es tate situation reflect a little more ac tivity. The value of mortgages re corded in Philadelphia showed an un usually large increase in July, while ordinary conveyances, which increased about 3 per cent in that month, showed the first gain since December of last year. Foreclosures, which so far this year have been exceptionally numer ous, declined nearly 11 per cent in July but they were 15 per cent larger than a year ago. Writs issued for sheriff sales during August rose sharply and were, with one exception, the largest of any month since Sep tember 1932. Agriculture. The gains which were evident in the condition of various crops in this district earlier in the 1929 1930 1932 Sources: R. L. Polk Company and Pennsylvania Motor List Company. month have been practically wiped out by extreme damage done to standing crops by a severe tropical storm in the third week of August. Swollen creeks flooded many truck patches, gales varying from 40 to 60 miles an hour leveled maturing corn, shook off peaches, apples and pears, tearing down many trees by the roots. The effect of this storm on the late crops, particularly in the southern part of this district, obviously will be such as to reduce yields; these already were indicated by the official reports to be lower than in other years, probably with the exception of tobacco. Milk and cream receipts in the Philadelphia area increased substan tially in July, contrary to seasonal ex pectation, but fell off in early August reflecting partly difficulties between producers and distributors in this sec tion. Cold storage holdings of dairy and poultry products increased sharply from July to August, Wholesale prices of farm products in the country as a whole showed an exceptionally sharp increase in July, but declined somewhat in early August, owing mainly to lower quo tations for grains, butter, eggs, and certain livestock and livestock prod ucts. The general level of farm prices in July was about 25 per cent higher than a year ago. Deliveries of commodi ties to distributing and manufacturing establishments in this section have con tinued in heavy volume. Freight car loadings in July again showed an ex ceptional gain of 12 per cent and the total volume was almost 40 per cent larger than a year ago. Since March the trend has been sharply upward so that the latest index of shipments by Distribution. rail reached the highest point for any month since late fall of 1931. Simi larly, deliveries of merchandise by motor freight rose steadily in the past four months. Wholesale and jobbing business has increased further, continuing the up ward trend since early spring. Sales of eight lines combined in July showed a gain of 3 per cent instead of register ing a decline as usual, so that when allowance is made for the customary seasonal change there occurred an im provement of about 6 per cent, owing to more active demand for dry goods, groceries, drugs, and paper. Early re ports for August indicate additional gains which are partly seasonal in character. The steady advance in the volume of sales in the past four months raised our seasonally adjusted index of sales from a record low point of 54 in March to 74 in July, or within 26 per cent of the 1923-25 average. Retail trade sales in July, on the other hand, while exceeding last year’s dollar volume by 2 per cent, failed to show improvement. This bank’s index number, which accounts for the number of trading days as well as seasonal changes and is based on monthly re ports from department, apparel, shoe and credit stores covering a period of ten years, declined from 60 in June to less than 58 in July; a record low index of 49 was reached in February. Preliminary reports from local de partment stores indicate that sales have improved appreciably in August. Retail prices have been advancing, though by no means for all classes of goods. On August first the average level of prices for general merchandise throughout the country was 5 per cent higher than a month ago and 3 per cent Page Five above that a year earlier, according to Fairchild’s index. Retail food prices in Philadelphia and Scranton, as in the country, have advanced for three con secutive months. Stocks of merchandise at retail es tablishments declined less than usual from June to July, so that when ad justed for the normal seasonal volume there was an increase of over 3 per cent, Philadelphia department and ap parel stores registering the largest gains. It is reported that a larger than usual volume of merchandise was in transit in the latter part of July and thus was too late for inclusion in the reports for that month. The increase in the total inventories of eight whole sale lines combined was about what was to be expected, although gains in dry goods, electrical supplies and gro ceries exceeded noticeably the usual seasonal increases. The rate of stock turnover in retail trade has been 3 per cent higher and in wholesale trade 14 per cent higher this year than last. Collections both at retail and wholesale have continued to be more prompt than a year ago, and the falling off in the rate of pay ment between June and July has been smaller than is customary. Sales of new passenger automobiles, as measured by registrations in this district, have been steeply upward since March. The small drop from June to July was much less than the usual decline in this period, indicating a further improvement in demand. Compared with a year ago, July sales were 64 per cent larger. Like most of the other indicators, sales of life insurance have shown im provement in the last four months. Our seasonally adjusted index number has risen with fair regularity, al though the amount of premiums paid has been smaller than in other years. RESERVE BANK CREDIT AND THE FACTORS WHICH AFFECT IT Philadelphia Federal Reserve District July 20 to August 23 inclusive (In millions of dollars) Sources of funds Uses of funds Currency demand................................................ Reserve bank credit extended in this reserve -2.7 Special and “Other" deposits at reserve Commercial and financial transactions (chiefly interdistrict)....................................... -3.4 bank..................................................................... Unexpended capital funds of reserve bank.. Treasury operations............................................ -2.3 In recent weeks the decline in loans to customers at the reporting member banks in this district has stopped. A decrease in the total of demand and time deposits held by the reporting banks was met without any increase in borrowings from the Fed eral reserve bank. During the five weeks ended August 23 the district had an adverse balance of over 3 millions in the settlement of commercial and financial transactions with other districts, despite a consider able gain in one of the weeks which apparently reflected sales of newly issued government securities. The Treasury received substantial sums as a result of cash payments for secu rities and withdrawals from depositary banks and the total of government receipts was more than 2 millions greater than local disbursements. These demands were more than balanced by 8 millions taken from member bank reserve deposits and a small return flow of currency; special and “other” deposits at the reserve bank increased over one million and there was a de crease of nearly 3 millions in reserve bank credit extended locally. The decrease in reserve bank credit reflected a decline of almost 3 millions in bills discounted, which totaled 301 2 / millions on August 23. Decreases were shown in both the federal reserve Banking conditions. note and deposit liabilities of this bank, but the influence of these was more than offset by a decrease in cash, which was due largely to transfers for the Treasury and payments in the set tlements, part of which was due to this bank’s participation in system purchases of securities; the result was a decline in the ratio from 64.8 to 63.9 per cent. Although loans to customers on securities declined 3 millions at the re porting member banks, this was more than balanced by a rise of 4 millions in other loans to customers, which probably are more closely indicative of accommodation extended to industry and trade. Holdings of United States securities increased 22 millions, but this was materially less than the amounts allotted to these banks on Reporting member banks (000.000’s omitted) Loans to customers: On stocks and bonds $ All other..................... Loans to open market. United States securities Other securities............ 249 254 15 273 244 Total loans and investments......... $1,035 Net demand deposits.. 535 Time deposits............... 311 Government deposits . 90 Amounts due from 80 banks.................. Amounts due t# banks 134 MILLIONS MEMBER BANKS' — RESERVE DEPOSITS OPEN MARKET LOANS AND INVESTMENTS Page Six $ 252 250 19 251 245 BILLS DISCOUNTED NOV OEC 1932 1933 Aug. 24. 1932 $ 304 295 8 197 265 $1,017 571 299 56 $1,069 620 264 18 89 151 94 175 FEDERAL RESERVE BANK OF PHILADELPHIA PHILA. FED RES DISTRICT APR MAY JUNE JULY AUG SEPT OCT July 19, 1933 Aug. 23, 1933 LOANS TO CUSTOMERS JAN EEB MAR +1.4 -0.3 Total............. i............................................... -8.4 Total............................................................... -8.4 Note: This table gives, in balance sheet form, a summary of the banking changes which have had an influence on the amount of reserve bank credit in use in the district. LOANS AND INVESTMENTS - 1933 REPORTING MEMBER BANKS MILLIONS -1.5 -8.0 August 15, showing that some of these had been sold. De mand deposits decreased 36 millions in the five weeks; part of this doubtless was due to a transfer to time deposits, which increased 12 millions. Withdrawals of bank funds held by the reporting banks, payments to firms in other districts, and purchases of the new United States securities by depositors probably account largely for the remainder of the decline in demand deposits. This decline was met by the proceeds from the sales of securities and decreases in open market loans and by drawing upon reserve balances. The new government securities, dated August 15, in cluded an issue of eight-year Treasury bonds with interest at 3J4 per cent and two-year Treasury notes bearing l^g per cent. Total subscriptions from this district amounted to 380 millions. The amount actually allotted here was 64 millions, payment being made as follows: by deposit credit, 53 millions; in cash, 7 millions; by exchange for other securities, 4 millions. Outstanding acceptances of banks in this district show a, further in crease from $11, Federal Reserve Changes in— Bank of 909,000 to $12, Philadelphia 23, (Dollar figures in Five 1933 One 991,000 during millions) weeks year July and the na Bills discounted.... $ 30.5 —$2.8 tional total in -.$31.0 Bills bought.............. 0.7 -0.1 - 2.6 creased from 687 United States secu rities........................ 148.5 -F 3.5 + 9.2 to 738 millions. Other securities........ 0.5 0 - 1.1 Most of the ex Total bills and securities........... $180.2 pansion in the lat +$0.6 — $25.5 Federal reserve note ter was due to a circulation............. 236.4 - 1.8 — 16.2 Federal reserve rise of 36 millions bank note circu lation ...................... 7.5 in bills covering + 1.0 + 7.5 Member bank re domestic ware serve deposits. . . . 125.8 - 8.0 + 8.8 Special deposits— house credits, member and non member banks. .. 12.2 + 0.8 + 12.2 which on July 31 Government de comprised 32 per posits ...................... 2.1 - 1.1 + 0.5 Foreign bank de cent of the total posits ...................... 2.3 + 0.6 + i.i Gold reserves and as compared with other cash............. 242.7 - 9.1 + 36.7 Ratio.......................... 23 per cent a year 63.9% - 0.9% + 8.6% earlier. Percentage change—July 1933 from July 1932 City areas* Manufacturing Employ ment Allentown............. Altoona................. Harrisburg........... Johnstown............ Lancaster............. Philadelphia........ Reading................. Scranton............... Trenton................. Wilkes-Barre.... Williamsport........ Wilmington.......... York...................... +25.2 + 6.7 + 5.2 +18.7 +34.6 +14.8 -10.4 +37.6 +21.7 +34.0 +20.0 +19.4 +15.7 Wage payments + 52.4 + 89.1 + 16.4 + 166.2 + 41.2 + 21.8 + 21.7 + 39.1 + 37.3 + 29.5 + 36.5 + 32.9 + 32.1 Building permits (value) + + 23.0 24.7 87.5 77.6 — + 46.8 + 35.1 + 114.3 + 21.4 + 8.4 + 1,348.0 + 35.2 27.1 — 75.2 Debits - 7.1 -11.2 +11.2 -35.9 - 5.7 + 9.7 -21.0 - 6.7 - 3.2 - 8.0 -24.5 +23.1 + 8.7 Retail trade sales - 1.8 +11.8 + 1.9 + 9.3 - 1.2 + 1.0 - 5.9 0.0 + 2.3 + 10.2 Factory Employment and Payrolls in Pennsylvania Employment* (Indexes of factory employment and pay rolls are expressed in percentages of the 1923-25 average which is taken as 100) Per cent change com pared with July 1933 index July 1932 Employehourst Payrolls June 1933 Per cent change com pared with July 1933 index Julv 1932 June 1933 All manufacturing 68.2 + 16.2 + 4.0 45.3 +36.4 + 7.9 Iron & steel & their products................ 55.0 Non-ferrous metal products................ 72.1 Transportation equipment............ 49.5 Textiles and clothing...................... 89.9 Textiles................. 83.3 Clothing............... 115.7 Fooa products......... 89.8 Stone, clay & glass products................ 69.9 Lumber products... 40.5 Chemical and allied products................ 79.3 Leather and its products................ 89.8 Paper and printing.. 82,1 Printing................. 79.5 Others: Cigars and tobacco............. 61.8 Rubber tires and goods................. 95.3 Musical instru ments ................. 32.1 +72.7 + 15.5 +14.7 + 3.1 + 2.9 59.8 +20.8 + 5.7 + 2.7 - 4.3 + 11.2 30.3 +11.8 +23.7 + 6.3 +32.8 +30.8 +38.6 - 0.9 +51 .7 +45.2 +61.3 + 1.0 - - 1.3 1.4 1.1 0.4 59.3 57.2 69.5 72.0 + 1.8 2.1 0.9 0.1 +49.6 + 5.7 + 2.2 - 2.9 + 2.1 - 4.4 + 12.0 + 9.8 64.7 +24.2 + 14.9 + 1.0 +28.8 + 7.2 71 .8 + 5.1 + 0.7 62 4 - 7.2 - 1.9 63.1 +43.3 + 16.0 - 2.0 - 0.8 -13.3 - 3.7 + 6.4 + 0.5 - 1.5 + 0.2 + 2.5 40.6 -10.2 - 3.6 + 6.0 +39.1 + 10.4 78.4 + 8.9 - 8.4 - 9.6 + 1.6 +49.1 +33.9 +30.0 * Figures from 1729 plants. 0.0 24.9 f Figures from 1206 plants. General Indexes of Employment and Payrolls in Pennsylvania Employment Occupation (1932 = 100) July Per cent change compared with 1933 index General index number Manufacturing.................... Anthracite mining.............. Bituminous coal mining . . Building and construction.. Quarrying and non-metallic mining.................... Crude petroleum producing Public utilities..................... Retail trade................. Wholesale trade. Hotels......................... Laundries................. Dyeing and cleaning............ 98.8 105.9 70.3 100.8 99.7 115 3 114.0 89.7 91.2 96.0 93.5 94.8 99.4 Payrolls Percentchange compared with July 1933 July June 1932 index 1933 + 6.7 97.0 + 4.0 111 .3 +11.0 + 3.6 - 2.5 71.1 99.2 72.3 + + 4.1 1.4 4.5 0.5 - 1 .9 +13.2 -10.4 - 2.4 - 3.0 - 0.6 - 3.3 - 3.8 - 3.9 99.7 81.8 83.3 88.8 78.7 82.1 85.0 - 6.8 June 1932 + 2.7 +16.2 - 1.2 + 5.3 + 2.0 July 1933 + 5.3 +36.4 + 10.3 +20.8 + 0.9 + + 2.3 1.0 4.8 1.8 - 4.3 - 3.6 -12.8 — + — + + + + + + 12.7 61.2 11.7 34.1 2.3 6.0 22.1 1 .2 6.9 3.4 1.8 18.3 5.4 + — — — — + — + - 53.4 28.8 51 .6 60.2 49.1 3.7 76.5 8.4 53.8 211.8 30.1 39.4 84.6 + 7 1 + 8 +16 +12 + 1 6 + 16 2 + 7 + 2 1 + 8 3 0 2 0 1 8 1 0 3 5 7 9 0 Digitized for Area not restricted to the corporate limits of cities given herd. FRASER * - 0.3 -17.2 - 9.3 - 8.1 -17.8 — 16 3 -12.3 PENNSYLVANIA PERCENT 1932 AVG zlOO +28.3 120 -21.0 - 9.9 -18.4 -10.8 0.0 -31.9 -23.1 -17.0 -31.3 -16.0 +13 .6 + 7.9 +11 .5 +27.0 -27 0 INDUSTRIAL EMPLOYMENT AND PAYROLLS > + + + + 4.8 4.7 6.3 6.3 +27.6 + 5.4 33.5 + 4.9 + 1.8 23.5 ' n L S + 7.9 + 13.1 + 8.4 + 14.7 + 3.8 + 3.9 -19.8 + 2.8 + 7.3 + 13.7 + 6.0 + 9.5 + 5.6 + 5.5 +16.5 + 9.1 38.0 July 1933 from June 1933 Allentown............. Altoona................. Harrisburg........... Johnstown............ Lancaster.............. Philadelphia......... Reading................. Scranton............... Trenton................. Wilkes-Barre.... Williamsport........ Wilmington.......... York...................... Per cent change July from June 100 L0YMENT \y/\ A/ PAYROLLS 00 -32.9 1932 193 3 19 3 4 Index numbers of individual lines of trade and manufacture Philadelphia Federal Reserve District WHOLESALE TRADE Index numbers expressed in percentages of the 1923-1925 average, which is taken as 100 Adjusted index numbers make allowance for the usual seasonal changes which result from an un even distribution of business be tween the months of the year. Unadjusted indexes reflect merely the actual changes which may or may not be up to the usual seasonal expectations. Adjusted for seasonal variation PHILADELPHIA FEDERAL RESERVE .DISTRICT AOJVSTtO JCMOWi VARIATION IMJ-iS *«..!# PERCENT v**,. * STOCKS 75 * SALES V- ... ^ Not adjusted 25 Percentage com parison July1932 June 1933 July 1933 July 1933 with Month ago Year ago BOOTS AND SHOES 75 7 , montfhe July 1932 1933 with 7 months 1932 June 1933 50 July1933 SALES 25 DRUGS 150 Retail trade STOCKS Sales Total of all stores..................... Department.......................... Men’s apparel...................... Women’s apparel................. Shoe......................................... Credit...................................... 56,6r 55.3 59.6r 66.6r 66.6 49.5 60.3 58.6 59.0 79.3 64.8 53.2 57.9p 56.Ip 52. Op 73.5 63.9 55. Ip - 4.0 - 4.3 -11.9 - 7.3 - 1.4 + 3.6 + 2.3 + 1.4 - 12.8 + 10.4 - 4.1 + 11.3 Stocks of goods Total of all stores.................... Department.......................... Men’s apparel....................... Women’s apparel................. Shoe......................................... Credit...................................... 65.5 r 57.3 71.5r 87. fir 64.3 70.2 54.9 50.0 52.6 84.5 54.8 55.8 56.7p 51. 6p 57.8 84.5 54.9 57.5p 4- 3.3 + 3.2 + 9.9 0.0 + 0.2 + 3.0 - 125 41.4r 40.8 45.5r 44. lr 61.3 32.2 58.9 55.9 61.4 77.1 74.5 50.0 42.2p 41.5p 39.8p 48.7 58.8 35.8p 59.6r 52.4 58.9r 67.6r 59.8 69.5 -15.0 -13.6 -10.9 - 6.4 -17.4 -25.1 52.5 47.9 50.2 75.8 53.7 54.1 51 ,4p 47.2p 7 V 100 A ^--- SALES ¥ 75 ■50 13.4 9.9 19.2 3.5 14.6 18.1 Rate of stock turnover 7 months (actual, not indexes) + 3.4* 2.03 - 0.5 -13.3 -13.0 - 1.8 + 17.8 + 2.8 -24.1 -38.6 - 1.3 52.Or 29.4 77.0 24.8 40.9 79.6r 32.5r 9.4 48.4 64.9 51.1 56.9p 2.10 25 DRY GOODS 50 -A* SALES‘S 23 Wholesale trade Sales Total of all lines...................... Boots and shoes................... Drugs...................................... Dry goods.............................. Electrical supplies............... Groceries................................ Hardware............................... Jewelry................................... Paper....................................... 56.6r 35.9 81.9 32.2 49.9 78.8r 33.5r 13.8 51.5r 70.0 47.0 75.9 40.3 90.1 88.3 41.3 29.3 66.6 74.3p 46.1 80. Op 56.2 83.2 94.6p 38.8 26.6 70.3p + 6.1 - 1.9 + 5.4 +39.5 - 7.7 + 7.1 - 6.1 - 9.2 + 5.6 + + + 1 + + + + 31.3 28.4 2.3 74.5 66.7 20.1 15.8 92.8 36.5 66.7 40.4 72.9 37.1 73.9 90.1 42.9 24.6 63.9 68.4p 37.8 75.2p 43.3 68.2 95 .5p 37.6 18.1 66. Ip STOCKS ELECTRICAL SUPPLIES ISO 125 A / A, 100 75 Y\ V", .4 a/vvv V SALES-S 50 Stocks of goods 66.0 57.9 57.6p 98.6 108 9 90 9 38.8 34.5 35 4p 80.8 47.1 53.4p 82.2 74.6 76.6‘ 64.9 58.9 59.6 47.8 42. lr 40.6 69.7 61.1 59. Ip - 0.5 — 16 5 + 26 + 13.4 + 27 + 1.2 - 3 6 - 3 3 — 12 7 65 0 — 33 9 80 8 25 46 2 67 9 GROCERIES 125 69.7 - 13.2 61.1 59. Ip 2 72 STOCKS 100 75 Rate of stock turnover +14.3* Output of manufactures Pig iron........................................... 10.7 22.1 30.9 Steel................................................. 24.4r 43.3 59.6 Iron castings.................................. 25.2 36.0 44.2 Steel castings................................. 19.9 26.5 46.2 Electrical apparatus.................... 38.lr 50.6 48.5 Motor vehicles.............................. 23.8 13.3 11.9 Automobile parts and bodies.. . 26.3 45.5 51.1 Locomotives and cars................. 14.4r 8.4 10.9 Shipbuilding................................... 174.0 72.2 70.4 Silk manufactures........................ 74.8 113.3 130.6 Woolen and worsteds.................. 38.0 74.7 83.4 Cotton products........................... 31.5 45.2 58.3 Carpets and rugs.......................... 39.8 41.0 55.3 Hosiery............................................ 86.5 140.9 97.6 Underwear..................................... 98.6 182.4 215.2 Cement............................................ 29.7 42.0 42.7 Brick................................................ 24.9r 30.1 46.5 Lumber and products................. 16.5r 20.2 18.0 Slaughtering, meat packing... . 88.2 Sugar refining................................ 67.1 Canning and preserving............. 25.3 Cigars.............................................. 78.9r Paper and wood pulp................. 52.7r Printing and publishing............. 87.2r Shoes................................................ 94.6 Leather, goat and kid................. 91.7 Explosives...................................... 42.6 Paints and varnishes................... 61 .7 Petroleum products................... 135.4 Coke, by-product....................... 46.3 105.7 83.3 27.6 83.1 63.7 86.6 142.0 107.9 54.0 81.3 129.9 69.0 +39.8 +37.6 +22.8 +74.3 - 4.2 -10.5 +12.3 +29.8 - 2.5 +15.3 +11.6 +29.0 +34.9 -30.7 + 18.0 + 1.7 +54.5 -10.9 + 0.8* 106.6 + 0.9 125.5 +50.7 28.9p + 4.7 82.6 - 0.6 67.4 + 5.8 87.0 + 0.5 152.7 + 7.5 126.6p +17.3 66.2 +22.6 81.0 - 0.4 130.9r + 0.8 85.1 +23.3 +188.8 + 144.3 + 75.4 + 132.2 + 27.3 - 50.0 + 94.3 - 24.3 - 59.5 + 74.6 + 119.5 + 85.1 + 38.9 + 12.8 +118.3 + 43.8 + 88.7 + 9.1 + 5.6* + 20.9 + 87.0 + 14.2 + 4.7 + 27.9 - 0.2 + 61.4 + 38.1 + 55.4 + 31.3 - 3.3 + 83.8 +10.8 + 5.9 -10.1 - 6.2 -18.0 -61.2 -26.6 -38.3 -50.7 +31.4 +35.6 + 7.2 -20.0 + 16.4 +46.2 -32.8 - 2.7 -26.1 — 1.2* + 3.4 + 5.5 - 5.3 + 1.6 - 5.3 - 8.0 +27.1 + 7.2 + 0.8 - 6.2 - 1.3 + 7.4 ^CV-'-w 2.38 9.8 22.2r 24.2 17.7 40.Or 24.3 25.2 14.4r 168.8 73.3 35.9 27.2 38.6 70.9 81.8 34.7 23.9r 18.lr 84 .4r 97.6 68.4 20.9 85.2 50.6r 84.6r 88.0 80.7 41.7 57.4 136.1 45.4 21.0 44.2 35.6 27.6 50.6 16.2 45.5 8.7 71.5 107.6 71.4 42.8 40.6 138.1 182.4 50.4 31.3 20.6 88 4 99.6 89.1 19.8 89.7 63.1 85.7 134.9 109.0 54.0 82.9 129.9 69.0 28.4 54.2 42.4 41.1 50.9 12.1 49.1 10.9 68.3 128.0 78.2 50.4 53.6 80.0 178.6 50.0 44.6 19.8 89 1 93.4 128.0 20. Ip 89.2 64.7 84.4 142.0 111.4p 64.9 75.3 131,2p 83.4 .. /" 50 HARDWARE 75 Page Eight p-Preliminary. r-Revised. STOCKS "****•••—-**"• SALES^ Sk— 50 25 JEWELRY 73 ViVr/'V V l/+V....... .. 50 SALES , STOCKS V / 25 PAPER 100 75 ....... •\..t STOCKS / . SALES- 50 25 1930 * Computed from data unadjusted for seasonal variation. STOCKS 1931 1932 1933
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