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MONTHLY REVIEW
of Credit and Business Conditions
S e c o n d
Federal Reserve Agent

F e d e r a l

D is t r ic t

Federal Reserve Bank, New York

B u s in e s s C o n d i t io n s in t h e U n i t e d S ta te s
R O D U C TIO N and trade continued in February
at the high level o f the preceding month, while
the general average o f prices declined and was
lower in February than at any time since the latter
part o f 1924.

P

P roduction

The Federal Reserve B o a rd ’s index o f production in
basic industries, which is adjusted fo r seasonal varia­
tions, indicated a continuation o f productive activity
during February in about the same volume as in the
preceding two months. M ill consumption of cotton and
the output o f flour, anthracite, copper, and newsprint
showed increases in February, when allowance is made
fo r usual seasonal changes, and the ouput of iron and
steel and lumber remained practically unchanged. A cti­
vity in the woolen industry and the production o f
cement declined. Autom obile production was in con­
siderably greater volume in February and was larger
than a year ago, although smaller than in the correspond­
ing month o f 1924. Em ploym ent and earnings o f fa c ­
tory workers increased, after the seasonal recession of
January, and were in February at practically the same
levels as during the latter part o f 1925. The volume
o f building contracts awarded declined both in January
and in February, but remained larger than in the cor­
responding months o f last year.
TEH CENT.

Index o f 22 Basic Commodities, adjusted for Seasonal Variations
(1919 = 100). Latest figure, February.




R e s e r v e

April 1, 1926

Reports by farm ers to the Department o f A griculture
o f intentions to plant in 1926 indicate that the acreage
o f spring wheat and tobacco w ill be slightly smaller,
the acreage o f corn w ill be about the same, and that o f
oats, barley, hay, and potatoes larger than that in 1925.
T rade

Wholesale trade in February was in about the same
volume as a year ago. A smaller volume o f sales was
reported fo r groceries, dry goods, and hardware, while
sales o f meats, shoes, and drugs were larger. Inven­
tories o f wholesale firm s dealing in groceries, dry goods,
shoes, and hardware were smaller at the end o f F ebru­
ary than a year ago. Trade at department stores and
at mail order houses was larger than in February o f
last year and department store stocks were about 5 per
cent greater than on the corresponding date o f 1925.
Freight car loadings continued at about the same
daily rate in February as in the preceding two months.
Shipments o f merchandise in less-than-carload-lots and
o f miscellaneous commodities were particularly large.
P rices

The general level o f wholesale prices, as measured by
the Bureau o f Labor Statistics index, after remaining
unchanged fo r two months, declined in February to a
point slightly below the low figu re o f 1925, reported fo r
last May. The greater part o f the decline since last
autumn has been in prices of agricultural commodities.
In February prices o f all m ajor groups o f commodities,
TERCENT

2

M O N TH LY REVIEW , APRIL 1, 1926

PERCENT

B IL L IO N S oTDOLLMRS

Indexes o f Factory Employment and F actory Payrolls in Manu­
facturing Industries (1919 average = 100 Per C ent).
Latest figures, February.

M onthly Averages o f W eekly Figures for Member Banks in 101
Leading Cities. Latest Figures are Averages for Three
W eekly R eport Dates in March.

except fuels, declined and particularly large reductions
occurred in the prices of grains, cotton, wool, silk, and
rubber. Price advances in February were shown fo r
petroleum, coke, and paper. D u rin g the first three
weeks o f March prices o f grains, cotton, wool, and silk
continued to decline and recessions were also reported
in the prices of sugar and hardwood lumber.

lower money rates during most o f M arch than prevailed
during the latter part o f February and have again ap­
peared toward the end o f March.
The im port o f about $30,000,000 o f gold from Canada
during the first two weeks o f the month follow ed a total
im port o f $28,000,000 in January and February. This
gold, deposited in the Federal Reserve Bank, was a
direct addition to the reserves o f New Y ork City banks,
and enabled these banks to reduce their indebtedness at
the Federal Reserve Bank.
The liquidation o f loans to brokers and dealers does
not release any large amount o f funds fo r other uses but
has a lasting effect on money conditions only in so fa r as
bank deposits are reduced and bank reserve requirements
reduced in proportion. The figures fo r the three weeks
ended March 24 indicate a reduction o f $94,000,000 in
the net demand deposits o f New Y ork City banks and
hence a reduction o f $12,000,000 in the reserves which
these banks were required to maintain at the Reserve
Bank. In its effect on basic money conditions the
liquidation o f street loans has therefore been a less im­
portant factor, as fa r as New Y ork City banks are con­
cerned, than gold imports. The detailed changes in
loans to brokers and dealers are given in a separate
article.
Treasury operations o f the March tax day and follow ­
ing were larger than usual, partly because the m aturity
on March 15 o f $600,000,000 o f Treasury notes (fo r the
whole country) was large and partly because o f an
added operation the follow in g week, the purchase by
the Treasury o f $122,000,000 o f L iberty 3rd 4*4 per
cent bonds in anticipation o f their maturity in 1928.
Income tax collections also proved to be larger than in
recent previous tax periods, despite tax rate reductions.
The returns fo r the country up to M arch 29 totaled
$480,000,000, and fo r this district $158,000,000.
Transactions in New Y ork during the recent tax
period are shown below in tabular form . On M arch 15,
the New Y ork Reserve Bank redeemed fo r the Treasury
$371,000,000 o f m aturing notes and cashed $29,000,000
o f coupons, a total o f $400,000,000. A s usual a large

B a n k C r e d it

A t member banks in leading cities demand fo r loans
chiefly fo r commercial purposes showed an increase,
partly seasonal in character, between the middle o f F eb­
ruary and the middle o f March, and on M arch 17 the
total volume o f these loans was close to the high point
reached last autumn. A further decline o f loans on
securities, which accompanied the sharp recession in
security prices in March, carried the total to a point
nearly $430,000,000 below that reached at the end o f the
year.
Follow in g a growth during February in the volume
o f Reserve Bank credit outstanding, there was a sharp
decline early in March to about the same level as a
year ago. Factors contributing to the decline have been
continued im ports o f gold and some reduction in mem­
ber bank reserve requirements, as well as the temporary
abundance o f funds resulting from the excess o f Treas­
ury disbursements over receipts around March 15.
Open market rates on prime commercial paper, after
& slight decline in February advanced in March to
— 4Y* per cent, the level which had prevailed since last
October.
M on ey M a rk et
Three principal influences in the money market dur­
ing March were the continuation o f gold imports from
Canada, a liquidation o f $350,000,000 in loans to brokers
and dealers by New Y ork City banks and their corre­
spondents, and Government financial operations on and
follow ing the March 15 tax day. A ll o f these influences
made fo r greater ease in money conditions and slightly




FEDERAL RESERVE AGENT AT NEW YORK

proportion of all maturing issues was presented for re­
demption in New York, as the financial center. The
amount actually paid into the market, however, was not
$400,000,000 but $300,000,000. More than $100,000,000
o f the maturing notes were held by the Federal Reserve
Bank fo r its own or agency accounts, and their redemp­
tion had no immediate effect on the money market.
Against a total payment to the market o f about $300,000,000, withdrawals from depositaries within the dis­
trict, income tax collections, and cash sales o f new
securities yielded only $75,000,000 on March 15, and the
Treasury transferred funds from other districts and
also borrowed tem porarily $190,000,000 from the New
Y ork Reserve Bank to balance its account at the close
o f March 15.
In anticipation o f these heavy Treasury disburse­
ments, New Y ork City member banks paid off more than
$50,000,000 of loans at this bank on March 13, and
under a special arrangement purchased tem porarily
$15,000,000 o f securities from the holdings o f the R e­
serve Banks and on M arch 15 another $20,000,000.
These transactions, together with some transfers o f
funds to the interior, reduced member bank reserves
substantially below requirements, so that on the morning
o f March 15 the reserves o f 24 leading New Y ork City
banks showed an accumulated deficit. Payments by the
Treasury on the 15th more than wiped out this deficit
and gave the banks surplus actual reserves, but left a
small deficit in average reserves, and money rates re­
mained unchanged at the levels o f the previous week.
D uring the remainder o f the week, the New Y ork
money market lost steadily through income tax collec­
tions in this district and commercial withdrawals o f
funds to other districts to replace funds which the
Treasury had collected as taxes in those districts and
transferred to New Y ork to pay off the New Y ork R e­
serve Bank. Consequently, by M arch 19, the New Y ork
City banks foun d it necessary to resell to the Reserve
Banks the securities tem porarily purchased and to in­

3

crease their borrowings in order to bring their average
reserves up to the required amount at the end o f the re­
serve week. A lso at the close o f March 19th the Treas­
ury paid off its advance from the New Y ork Reserve
Bank.
A s a net result o f all these operations there was no
plethora o f funds in the market at any time, the average
reserves o f New Y ork City banks remained remarkably
steady, and call money was quoted at 41/4 per cent
throughout the week.
In the follow ing week, as Treasury balances at the R e­
serve Banks were increased by collections of income tax
checks, and transfers out o f town continued, call money
rates hardened to 5 and 5 % per cent. The purchase in
New Y ork on M arch 23 o f $84,000,000 o f the 3rd 4 %
Liberty bonds was offset by Treasury withdrawals from
depositaries and transfers to other districts during that
week and thus had no marked effect on money conditions.
B rokers’ time loans declined to 4y 2 per cent fo r a
few days after the 15th, but fo r the month averaged
about 4 % per cent, or approxim ately the same as in
February.
Commercial paper was slightly firmer at 41/4 -4 % per
cent early in March, eased slightly after the March 15th
tax period, but later returned to
per cent.
D ealers’ reports indicate that the amount o f commer­
cial paper outstanding failed to show the usual seasonal
increase in February. The outstanding paper o f leading
dealers who report each month to this bank totaled $655,000,000 at the end o f the month, or practically the same
amount as at the end o f January.
Bills were more active, coincident with the slightly
easier money conditions prevailing over the 15th o f
March, and as there was a seasonal decline in the supply,
dealers portfolios were substantially reduced. Rates,
however, continued unchanged at 3 % per cent on pur­
chases o f 90-day unindorsed bills, and 3 % per cent on
sales.

Gains and Losses to New York Money Market (In millions of dollars)
March 1926

12
Gains to Market
Treasury transactions (mostly notes redeemed and interest paid).

13

15
288

16

17

18

19

20

26

23
13

Reserve Bank transactions (mostly acceptances and securities bought and net increases in loans to New York
City Banks)...............................................................................................................................................................
Total gains.

10 10
29

298

36

12 11

72

33

11

78

46

87

8
12

26

Losses to Market
Treasury transactions (mostly income taxes collected and withdrawals from depositories).
Commercial transactions (mostly transfers)— net loss..............................................................................................
Reserve Bank transactions (mostly acceptances and securities matured or sold and net decreases in loans to New
York City Banks)........................................................ .............................................................................................
Total losses.
Net gain for day............
Net loss for day..............
Cumulative gain or loss.
Reserve position of 24 largest New York City Banks:
Actual reserves at close of business..........................
Average reserves (Saturday to date)........................




74

2

Commercial transactions—net gain.............................................................................................................................

25
26

87 134

3

164

81

37

65

85
45 25 54
+ '3 — 82 +82 +37 +1 2 —42

41

55

45

55

47
— 52

624 538
657 635 579 614 565
600 538 591 608 613 607 608 565

32

+ 4
561
564

615
577

4

MONTHLY REVIEW, APRIL 1, 1926

L o a n s t o B r o k e r s a n d D e a le r s

Loans by New Y ork City banks to brokers and dealers
on securities have been reduced more than $310,000,000
from the high point at the beginning o f 1926. Loans
placed fo r correspondents show a decrease o f $140,000,000 fo r the same period, and the total fo r both accounts
therefore shows a reduction o f $450,000,000.
Loans to brokers and dealers are com pared in the
follow in g table with total loans on securities as reported
by member banks. It appears that changes in brokers ’
loans account fo r most of the fluctuations in total loans
on securities o f New Y ork City banks, but brokers’ loans
placed fo r correspondents are a smaller element in and
are follow ed less closely by total security loans o f re­
porting banks outside o f New Y ork City.
(In millions of dollars)
Reporting Banks
New York City

1926

Jan.

6. . .
13...

20...

2 7...
3 ...
10 ...
17...
2 4...
Mar. 3 ...
10 ...
17...
2 4...

Feb.

Total
Loans on
Stocks and
Bonds

Reporting Banks
Loans to
Outside
Brokers and
Loan to
New York City
Dealers
Total
placed by
Brokers and
Loans on
Dealers placed
N. Y. City Banks
for own acoount
Stocks and
for
Correspondents
Bonds

2,354
2,245
2,230

1,338
1,267
1,232

2,179
2,104
2,087
2,061
1,959
2,017
2,041

1,199
1,159
1,149
1,125

2,201
2,221

1,201
1,222

1,021

1,033
1,027

3,334
3,322
3,327
3,308
3,307
3,329
3,343
3,340
3,374
3,354
3,317
3283

1,239
1,292
1,306
1,287
1,280
1,340
1,354
1,343
1,321
1,266
1,174
1,098

Loans placed by New York City banks for others than correspondents are
not included in this table.

The accom panying diagram carries back over several
years the loans on stocks and bonds reported by member
banks in New Y ork City and other leading cities.

month price averages o f high grade bonds were down
about % o f a point from the February high levels.
Follow ing the announcement and oversubscription o f
the new Treasury offering o f $500,000,000 o f 30-year 3 %
per cent bonds at a price to yield approxim ately 3.71%
per cent, all active United States Government issues,
with the exception o f the Treasury 4^4’s, established
new high levels fo r the year, but were slightly lower in
the latter part o f the month.
The volume o f new securities offered in M arch was
smaller than in either o f the two previous months, but
somewhat larger than in the corresponding month of
1925. Offerings o f railroad and public utility securities
were larger than in February, but there were decreases
in industrials, municipal and state obligations, and fo r­
eign securities. The total o f foreign security offerings
fo r the first quarter o f 1926 is about 25 per cent smaller
than fo r the first quarter of 1925.
I n c o r p o r a t io n s a s a n I n d e x o f B u s in e s s A c t i v i t y
A series o f figures which is highly responsive to
changes in business activity and business profits is
found in the New Y ork State records o f incorporations
o f stock companies. These data, which are available
back to 1892, indicate the rapid expansion o f the cor­
porate form o f enterprise during the last thirty-five
years. The number o f stock companies incorporated in
New Y ork State at five-year intervals has been as
follow s:
1895 ............................
i 423
1900 ............................
1905 ............................
1 9 1 0 ............................
1 9 1 5 ............................
1920 ............................
1925

1,864
5,609
7,998
10,493
15,115
24,703

The monthly variations in incorporations after allow­
ance fo r the trend o f year-to-year increase and fo r sea-

Member Bank Loans Secured by Stocks and Bonds, New York City
and Elsewhere, 1922 to 1926. Latest figures March 17.

S e c u r it y M a r k e t s
Stock prices declined rapidly in March in active trad­
ing. On March 3 sales reached a new high volume of
close to 3,900,000 shares, and on 12 days, sales exceeded
2,000,000 shares.
Corporation bonds, which in February reached the
highest levels in nine years, reacted slightly in March,
follow in g the decline in stocks, and at the close o f the




centages of Computed Trend, with adjustment for Seasonal
Variations.

5

FEDERAL RESERVE AGENT AT NEW YORK

sonal fluctuations are shown in the accom panying
diagram for the period since 1918. A great increase in
1919 followed the war time restrictions, but the crest
was passed before the end of 1919. The almost equally
rapid decline in incorporations in 1920 was follow ed by
a recovery in 1921, while the general tendency o f p ro­
duction and prices was still downward. A normal rate
of increase was maintained thereafter until 1924.
A tem porary recession in 1924 was follow ed by an
extraordinary rise in the number o f incorporations in
1925, reflecting what was probably the highest level o f
general business activity, and largest profits in any year
since the war. The index o f incorporations in the last
four months has shown a moderate recession from the
high level of last fall, but has remained fa r above normal.
F o r e ig n T r a d e
February exports valued at $353,000,000 were $44,000,000 smaller than in January, and $18,000,000 smaller
than a year ago, while imports valued at $389,000,000
were $28,000,000 smaller than in January, but $56,000,000 larger than in February 1925. This indicates net
imports of $36,000,000 in February, the fourth and
largest im port balance since June 1923, as shown in the
accom panying diagram.

\MILLIONS OF
DOLLARS

Monthly Imports and Exports of Merchandise of the
United States since 1 9 2 1 .

Grain exports continued to decline, the value o f F eb­
ruary shipments being the smallest since A p ril 1914.
Raw cotton exports also showed a further substantial
decline and were much smaller than a year ago. Silk
imports, which have been running substantially larger
than a year previous, showed a slight reduction com­
pared with February 1925, but the quantity o f crude
rubber im ported was nearly 50 per cent larger than a
year ago, and the increase in value was even greater.




F o r e ig n E x c h a n g e
The principal new development in the foreign ex­
changes during March was a decline in the Belgian
franc from the 4Vo cent level which had been maintained
since last September to below 4 cents. The decline was
attributed to difficulties arising in Belgium in connection
with that cou n try ’s program fo r monetary stabilization.
French francs, which were firm early in the month, also
declined, touching 3.40 cents on March 29, the lowest
point on record. Sterling, after a slight decline at the
end o f February, fluctuated between $4.85% and
$4.85% . Italian lire continued steady as did the Dutch,
Austrian, and German exchanges, while Danish kroner
attained new high levels since 1919.
Japanese yen reacted more than 1 cent to 45 ^4 cents,
and Chinese currencies were also somewhat lower.
The Argentine peso declined nearly 2 cents to slightly
below 39 cents, lowest since May 1925, and Brazilian
milreis also were easier.
D uring the first part o f the month, the discount on
Canadian funds increased to 9 /1 6 o f a cent, but follow ­
ing imports from Canada o f about $38,500,000 o f gold,
the rate firmed to a discount o f 3 /1 6 o f a cent.
G o ld M o v e m e n t
Gold movements between the United States and other
countries in February resulted in an im port balance of
$21,500,000, and brought net imports fo r the first two
months o f 1926 to $38,000,000. February imports totaled
$25,400,000, including $10,000,000 from Chile, $10,000,000 from Canada, and $4,000,000 from Japan, while
exports amounted to only $3,900,000, most o f which was
consigned to Central and South Am erica and the Orient.
D uring the first 30 days o f March, additional imports
o f about $38,500,000 o f gold were received from Canada,
accom panying a continued discount on Canadian funds
in this country. These imports brought total gold receipts
from Canada this year to $66,000,000, or $20,000,000
more than was shipped to Canada last fall. The other
principal im port in M arch was $2,400,000 from the
Banco de Chile to be used as an external reserve, aug­
menting the $10,000,000 shipped to New Y ork in F eb­
ruary. Gold exports were about $2,000,000, includ-

1925

April................
May................
June.................
September. .. .

1926
January...........
February.........

Imports

Exports

$ 5,037,800
3,602,527
7,337,322
8,869,883
11,392,837
4,426,135
10,204,112
4,861,736
4,128,052
50,740,649
10,456,115
7,216,004

$73,525,943
50,599,708
25,104,416
21,603,945
13,389,967
6,712,480
4,416,452
2,135,690
6,784,201
28,039,190
24,360,071
5,967,727

19,351,202
25,415,655
41,488,000

3,086,870
3,851,374
2,028,000

Imports

Excsess of
Exports
$68,488,143
46,997,181
17,767,094
12,734,062
1,997,130
2,286,345

$5,787,660
2,726,046
22,701,459

i,248,277
16,264,332
21,564,281
39,460,000

*=Port of New York and Canadian shipments only.

2,656,149
13,903,956

6

MONTHLY REVIEW, APRIL 1, 1926

ing numerous small shipments
many, Mexico, and the Straits
net im port movement fo r the
the P ort o f New Y ork and from

to South Am erica, Ger­
Settlements, so that the
month to date through
Canada was $39,460,000.

B u ild in g
B uilding activity throughout the country showed a
seasonal decrease in February but was at a higher level
Ifchan in February o f any previous year. Contracts
awarded fo r construction work in 37 states were 25 per
cent larger than a year previous, according to the F. W .
Dodge Corporation. In the New Y ork and Northern
New Jersey D istrict the increase was 65 per cent, but
contracts were slightly smaller than in February 1924.
The amount of new building in prospect, as reflected
by permits granted, appears to have slackened somewhat
in February. The S. W . Straus Company reports that
the valuation of buildings fo r which permits were issued
in 448 cities in February was 7 per cent smaller than
a year ago. Reductions were reported by about half
the leading cities and a m ajority of states.

In this district, a threatened strike in the dress in­
dustry was averted, but labor troubles reduced em ploy­
ment in the fu r industry o f New Y ork City and in the
woolen mills o f Northern New Jersey. Further in­
creases in employment in steel mills and railroad equip­
ment plants were reported in February, however, and
seasonal expansion occurred in the automobile industry
and in clothing.
The accom panying diagram makes a com parison be­
tween employment in February this year and a year
ago, and shows that employment in the building mate­
rials, automobile, iron and steel, and silk goods indus­
tries was well above the levels o f a year previous, while
the principal decreases were in cotton goods and woolen
and worsted mills, and cigar and other tobacco factories.
INDUSTRY
BRICK
cement'
AUTOMOBILES
S IL K

FEB .1925

100%

|
|

|1 7 6

(130

|

HHN6

|

Hno

PIGIRON&ROLLMIL15I

1107

MENS CLOTHING

1 106

|

RAILWAY EQUIP. FACT|

3^103

WOMENS CIOTHING I

FURNITURE

I

LEA TH ER

1

BOOTS & SH OES

Bp 103

(102
|'|9Q

|

CARPETS 8 R U G S |
COTTON G O O D S* fij
WOOLENS &WORSTEDS|
CIGAR5&TOB. PROD.

TOTAL

1:9©
191 !

|dl
131
gji02.

February Employment in Leading Industries of New York State
Compared with Employment in February 1925
19 1 9

1920

1921

1922.

1923

1924

1925

192 6

Changes in Construction Costs, 1919 to 1926
(1913 = 100 Per cent.)

Building costs in general are about the same as a year
ago and are close to the highest level since 1920, as the
accom panying diagram shows. Building materials have
not shown the advance that frequently occurs in the
early months o f the year and are slightly lower than a
year ago despite a large volume of business, but wage
costs continue to rise. In New Y ork City negotiations
over new wage contracts have resulted in increases of
$1.50 and $2.00 a day fo r most of the skilled trades, and
$1.00 a day for helpers.
E m p lo y m e n t
A moderate increase in employment occurred in F eb­
ruary in New Y ork State and in nearly all other sec­
tions o f the country fo r which reports are available.
F actory employment averaged about 1 per cent higher
in February than in January and 2 to 3 per cent higher
than a year ago.




* Compared with employment previous to strike of February 1925.

P r o d u c tio n
A fte r allowance fo r seasonal variations and year-toyear growth there appears to have been no consistent
change in production in February, com pared with the
previous month or with a year ago.
Anthracite production was about 30 per cent, o f the
normal fo r the month o f February, but by the middle
o f March was running above normal. Bituminous out­
put was maintained at a high level in February, and has
since shown little more than the usual seasonal decline.
Iron and steel production has been at close to capacity,
though new business has not kept pace with shipments.
A utom obile production showed more than the usual
seasonal increase over January, but the rate o f expansion
is reported to have been slower in March.
This ban k ’s indexes o f production, in which adjust­
ment is made fo r year-to-year growth and the usual
seasonal variations, are shown below.

FEDERAL RESERVE AGENT AT NEW YORK
(Computed trend of past years=100 per cent)

In d e x e s o f B u s in e s s A c t iv it y

1925

Producers’ Goods

Pig iron r .................................................
Steel ingots..............................................
Bituminous coal......................................
Copper, U. S. mines................................
Tin deliveries..........................................
Zinc.........................................................
Petroleum...............................................
Gas and fuel oil......................................
Cotton consumption...............................
Woolen mill activity*.............................
Cement....................................................
Lumber...................................................
Leather, sole...........................................
Silk consumption*...................................

Consumers* Goods

Cattle slaughtered..................................
Calves slaughtered..................................
Sheep slaughtered...................................
Hogs slaughtered....................................
Sugar meltings, U. S. ports....................
Wheat flour............................................
Cigars.....................................................
Cigarettes...............................................
Tobacco, manufactured..........................
Gasoline..................................................
Tires.......................................................
Newsprint...............................................
Paper, total............................................
Boots and shoes.....................................
Anthracite coal.......................................
Automobile, all.......................................
Automobile, passenger............................
Automobile, truck..................................
♦“ Seasonal variation not allowed for

1926

Feb

Dec.

Jan.

Feb.

120r
113
96
111
119
97
121
105
101
97
119
115
83
114

112r
123
116
103r
109
113
116
107
98
88
124
113
68
122

112r
110
113
103
129
105
114
107
93
86
123r
104
64
132

108r
112
116p
107
100
106

102
122
99
103
85
104
95
78
103
134
135
111
106
96
103
110
106
127

108
132
104
80
184
97
98
82
100
135
141
120
95
95
**
137
138
132

104
116
103
82
139
90
86
80
111
137
132
119
94
84
**
120
120r
121r

**=Strike

Preliminary

io2
83j>
108
i2i
106
116
114
76
90
94
74
109
i27
100
91p
30p
132
133
128
r=Revised

Further evidence o f active trade appeared in increases
over last year in department store, chain store, and mail
order house sales, newspaper and magazine advertising,
and in the volume o f postal receipts. F actory em ploy­
ment showed about the usual seasonal increase and busi­
ness failures continued below normal. The follow ing
table gives this ban k ’s indexes in percentages o f the com­
puted trend, with allowance fo r seasonal variation and,
where necessary, fo r price changes.
(Computed trend of past years=100 per cent)
1925

The average level o f wholesale prices was 0.6 per cent
lower in February than in January and was the lowest
since October 1924, according to the Department o f
Labor index. The tendency of basic com modity prices
continued downward in March, this ban k ’s weekly index
declining about 2 per cent in the first three weeks o f
the month to a new low point since 1924.
The price decline, which has proceeded almost con­
tinuously since last September, has been due largely to
declines in farm products, including cotton, wool, and
hides, as well as foodstuffs, together with a resulting
decline in textiles and foods during recent months. This
decline has accom panied a larger production in Europe
and some decrease in exports o f A m erican farm prod­
ucts. Other groups o f commodities have shown relatively
little change during the past year.
The decline in prices in this country during the past
year has been quite moderate com pared with that in
most European countries. The follow ing table compares
the Department o f Labor index o f wholesale prices in
the United States with similar indexes fo r other coun­
tries.
(1913=100)
February 1925
United States................................................
England.........................................................
France (gold basis)*.....................................
Germany.......................................................
Austria (gold basis)*.....................................
Hungary (gold basis)*..................................
Netherlands..................................................

161
168
125
137
146
152
158

Latest, 1926
155
150
106
118
122
127
150

(February)
(February)
(February)
(February)
(January)
(January)
(February)

*=Indexesconvertedfromapapercurrencybasistoagoldbasisbyallowing
forthedepreciationof thecurrencyintermsof theAmericandollar.

1926

Feb.

Dec.

Jan.

Feb.

108
101
90
109
65
100

106
106
89
124
47
104

105
100
82
130
47
97

106
100
85p
127j?
37

105
99
120
116
112
98
96

100
102
134
113
126
102
97

97
97
122
99
110
103
98

100
96
121
109
113
103
97

109
122

111
122

114
128

113
124

103

100

110

106

97r

lOOr

106r

104r

108r

115r

120r

118r

Postal receipts........................................
Electric power........................................
Employment, N. Y. State factories.......
Business failures.....................................
New corporations formed in N. Y. State.
Building permits.....................................

187
98
104
100
96
106
159

245
108
112r
100
101
127
160

221
97
109
101
97
128
149

202
100

General Price Level................................

185

188

188

187

Primary Distribution

Car loadings, merchandise and misc...,
Car loadings, other.................................
Grain exports..........................................
Panama Canal traffic..............................

C o m m o d i t y P r ic e s




General business appears to have continued at approx­
imately as high a level in February as in any recent
month. Bank debits in 140 centers outside o f New Y ork
City continued to show more than the normal annual
increase over the high level o f a year ago. Railway
traffic in merchandise and miscellaneous freight was
larger than in February o f previous years, and loadings
o f other commodities continued in approxim ately normal
volume.

Distribution to Consumer

Department store sales, Second District.
Chain store sales.....................................
Mail order sales......................................
Life insurance paid for...........................
Real estate transfers...............................
Magazine advertising.............................
Newspaper advertising...........................

General Business Activity

Bank debits, outside of New York City.
Bank debits, New York City.................
Bank deb ts, 2nd Dist. exclusive of New
York City............................................
Velocity of bank deposits, outside of New
York City r .........................................
Velocity of bank deposits, New York
City r ........................................
Shares sold on New York Stock Ex-

ioi
96
124
144

♦Seasonal variation not allowed for
Preliminary r=Revised

W h o le s a l e T r a d e
Sales o f leading wholesale dealers in this district dur­
ing February were 18 per cent larger than in January,
due prim arily to seasonal increases in sales o f clothing,
but fo r the second consecutive month they were 4 per
cent smaller than a year ago.
Declines com pared with last year occurred in 9 out
o f 15 reporting lines and were particularly large in
sales o f w om en’s clothing and cotton goods. There was
a sharp reduction in diamonds after the heavy sales re­
ported in January, and silk sales showed practically no

change over last year, follow ing substantial gains in
previous months.
Silk stocks continued to be much heavier than last
year, and shoe stocks were somewhat larger, but stocks
o f groceries, cotton goods, and jew elry and diamonds re­
mained smaller.
Collections averaged slightly larger than a year ago,
although the number o f lines reporting increases and
decreases was evenly divided. W ith the exception o f
the coat and suit trade and cotton jobbing, all lines
reporting accounts receivable showed increases over last
February.

Commodity

Percentage
Change
Feb. 1926
from
Jan. 1926

Net
Sales
Groceries...................
Men’s clothing.........
Women’s dresses----Women's coats and suits
Cotton goods-Jobbers..
Cotton goods-Commission........................
Silk goods.................
Shoes.........................
Drugs........................
Hardware..................
Machine tools..........
Stationery.................
Paper.........................
Diamonds.................
Jewelry......................
Weighted Average...

— 14.8
+65.7
+20.7
+66.4
+33.2

Percentage Change
Feb. 1926 from Feb. 1925

Stock
end of
month
— 3.8

+22.1

+ 7.1
— 0.9 *— 0.4
— 0.1 +11.5

— 2.1

+ 3.3
+12.7
+ 2.4
— 1.5
— 35 6
+36.1

'+ 7.2

Net
— 3.1
+ 5.7
— 24.0
— 16.4
— 13.5
— 8.4
+ 0.7
— 5.2
— 0.7
— 7.5
+27.7
+10.7

Stock
end of
month

Col ections

Acc’ts
Receiv­
able

3.6

+ 1.3
+ 7.8

+ 9.9
+20.7

— i8*.2
— 7.9

— 23.0
— 3.3

+16.4
+17.8

+ 13 .5

—10
*+37
+ 4
+ i

—'6.2
+io.'8

+ 1.8
+ a!i
+ ‘5!6

— 19.0
+ 7.0

— 2i!6

+ ‘5:7

4.3

+ 1.4

+ 5.9

+ 6.8

+ 15 .4

+17.8

— 2.3

+1 7 .4

* = Stock at first of month— quantity not value.

D e p a r tm e n t S tore T r a d e
Department store sales in this district during Feb­
ruary averaged about 3 per cent larger than a year
ago. This increase is the smallest reported since early
last fall, apparently due less to slackening o f trade this
year than to unusually active trade in February o f last
year. A pparel store sales showed a slightly larger in­
crease, and mail order sales were 6 per cent larger. The
rate o f stock turnover in department stores continued
slightly below that of a year ago.
Percentage Change
February 1926 from February 1925
Loca ity
Net
Sales

Stock
on Hand
end of
month
+ 4.5

New York....................................
Buffalo.........................................
Rochester.....................................
Syracuse.......................................
Newark........................................
Bridgeport...................................
Elsewhere.....................................
Northern New York State—
Central New York State........
Southern New York State.. . .
Hudson River Valley District.
Capital District.......................
Westchester District...............

+ 3.3
— 2.3
+ 7.2

All department stores.................

+ 2.7

+ 3.8

Apparel stores.............................
Mail order houses.......................

+ 6.2

+ 3.4

+12.8

— 2.0

— 0.4
+ 24.4
+ 1.7

—10.8
+ 5.9
— 1.6

+11.3
— 2.4
— 7.2

+ 6
+ 7
+20

Accounts
Receiv­
able*

+ 9
+13

+14.0
+ 1.3
+22.4
— 24.8
+ 8.3

+ ’i

+ 'e!i

Net Sales
Stock on Hand
Percentage Change Percentage Change
February 1926
February 28, 1926
from
from
February 1925
February 28, 1925
Toys and sporting goods......................
Shoes.......................................................
Toilet articles and drugs.......................
Books and stationery............................
Men’s furnishings..................................
Silverware and jewelry.........................
Cotton goods............ .............................
Linens and handkerchiefs.....................
Hosiery...................................................
Furniture. v . ; .......................................
Home furnishings...................................
Women’s and Misses’ ready-to-wear. .
Luggage and other leather goods.........
Silks and velvets...................................
Women’s ready-to-wear accessories.. .
Men’s and Boys’ wear..........................
Woolen goods.........................................
Musical instruments and radio............
Miscellaneous.........................................

+ 89
+20.6

+ 9.9
+ 30 .3

+21.3
+20.4
+ 13.2
+11.6
+ 8.0
+ 6.4
+ 4.7
+ 4.4
+ 3.0
+ 2.7
+ 0.1
— 0.2
— 0.3
— 1.2
— 1.6
— 13.3
— 30.3
— 31.0
— 2.7

+21.7
+ 6.0
+ 1.6
+ 11 .5
+ 5.2
+ 5.1
+ 2.6
— 3.0
+10.0
+15.1
+ 1.3
— 1.1
+15.1
— 0.2
— 5.9
+ 7.2
— 21.9
+ 1.8
— 7.1

C h a in S t o r e S a le s
Total sales o f reporting chain store systems showed a
considerably larger gain over last year in February than
in January, due chiefly to a much larger increase in
grocery sales. Sales per store were about equal to those
o f a year ago, whereas in January they averaged 6 per
cent smaller.
Variety, drug, and five and ten cent stores continued
to report large increases over last year in total sales,
but tobacco sales, although larger than a year ago, have
failed to increase proportionately with the rapid expan­
sion in the number o f stores in operation. Sales o f shoe
and candy stores fell below last year, but the number
o f stores continued to show large gains.

Type of Store

Percentage Change
February 1926 from February 1925
Number of
Stores

Total
Sales

Sales per
Store

Ten Cent.............................................................
Tobacco...............................................................
Shoe.....................................................................
Candy..................................................................

+ 20.0
+ 16.6
+17.8
+ 5.9
+16.3
+15.9
+18.8

+23.9
+ 23.0
+ 18.8
+ 9.0
+ 7.4
— 2.2
— 3.7

+ 3.2
+ 5.5
+ 0.9
+ 2.9
— 7.6
— 15.6
— 18.9

Total................................................................

+18.4

+18.3

— 0.1

Grocery..............................................................
Variety..........................................................

+ 4.2
+ 1.5
+ 4.2

* = Ex elusive of instalment accounts.




+ 1.2
— 0.1
+ 2.6

Collec­
tions*

The volume o f instalment business o f department
stores in this district appears to have been reduced dur­
ing the past year in New Y ork City, but increased in
most other localities. F o r the entire district, reported in­
stalment accounts receivable at the end o f the month
were about 4 per cent smaller than a year previous, and
collections on such accounts during the month were 3
per cent smaller. Collections on regular accounts were
considerably larger than last year, but this appears to
be due to an increase in credit business, indicated by a
larger amount o f accounts receivable.
Sales o f toys and sporting goods continued to show
the largest gain over last year, and substantial increases
were also shown in other articles o f more or less luxury
character, and in m en ’s furnishings and shoes. The
large decrease in sales o f musical instruments and radio
sets was apparently due to unusually heavy sales last
February.