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{O n the last p a g e is given a b r ie f su m m a ry o f the op era tion s o f the F ed era l R eserve B a n k o f N ew Y o rk in 1 9 2 1 , and their cost)
M O N TH LY R E V IE W
Of Credit and Business Conditions
In the Second Federal Reserve District
By
th e
Federal
Reserve
Agent,
Federal
Reserve
Bank,
New
York
N ew Y o r k , F eb ru a ry 1 , 1 9 2 2
Credit Conditions
H E passing of the holiday period with its heavy
demand for hand-to-hand currency, and the settle
ment of obligations maturing around the beginning
o f the year, were attended b y a large increase during the
first half of January in the volume of loanable funds in
N e w Y o rk C ity. T h e effects of this increase were felt
in the various money markets and in the loans of the
N e w Y o rk Reserve Bank. T h e decline of interest rates
which began about a year ago, was continued, and rates
reached levels lower than at any time since 1919. In
the markets for investment securities the effects of the
larger supply of m oney were manifested in the sale of
bonds, which continued very active and at higher prices,
and in the stock market where prices rose also. A t the
N ew Y ork Reserve Bank loans declined $100,000,000
to the lowest point since April 5, 1918, of which about
$50,000,000 represented the retirement from circulation
of Federal Reserve notes.
T h e January decline in interest rates was quite in
line with the initial stages of the winter easing of money
which used to take place before the advent of the Federal
Reserve system. B u t there was this difference, among
others, that it did not follow a marked rise of interest
rates during the fall and early winter, when crops were
being m oved and holiday trade was requiring a large
supply of currency. In former years the financial m a
chinery of the country was ordinarily put to its greatest
strain for both credit and currency when crops were
being harvested, and this strain usually was not relieved
until the currency required in the course of holiday trade
returned to the banks. I t was then usual for surplus
funds to pile up in local banking centres, from which a
large part of the surplus, often largely in the form of
currency, would be transferred to the principal banking
centres and from there to N ew Y ork.
In former times this accumulation of funds in N ew
Y o rk C ity , together with the liquidation that ordinarily
took place around the first of the year, resulted in a
sharp fall of interest rates, as surplus funds sought em
ploym ent. Just as there was no reservoir upon which
agriculture and business could draw in the autumn for
the additional currency and credit required at that season,
so no means was at hand in midwinter for the absorption
and retirement of a surplus. W hile these alternating
periods of stress and ease were not without advantage to
T
those who could adjust their borrowing requirements to
the months of relatively low interest rates, they bore
heavily upon those who had to borrow in the late summer
and fall, particularly upon farmers and others engaged
in the marketing of farm products, whose need to borrow
was fixed largely by the seasons.
T h e furnishing of a means whereby seasonal require
ments for credit could be m et and seasonal fluctuations
of money rates be largely done away with, was one of
the main purposes in establishing the Federal Reserve
system. T h e last five years have shown to what extent
the Reserve system is able to meet a prolonged period of
emergency, and to mitigate the evils of such a period.
Perhaps it is too soon to tell with accuracy how far the
Reserve system is able to change former conditions so
that the seasonal alternations of credit strain and credit
surplus shall give way to regularity and stability— to a
condition where the supply of credit responds to the
demand, both in its rise and fall.
Typical Seasonal Changes in Interest Rates on 60 to 90 Day Com
mercial Paper for the Years 1890 to 1908 and the Years 1917 to 1921.
Weekly Variations Are Shown as Percentage Deviations from the
Annual Average
B u t even though m any of th e normal currents of the
money market during the last five years w e r e lost in the
vast financial undertakings o f th e war, it is possible to
2
MONTHLY REVIEW
present certain evidences on this point. T h e diagram
printed on page one compares the seasonal variations
in interest rates in N ew Y o rk C ity before and after the
establishment of the Federal Reserve system. I t shows
b y weeks the m ovem ent of interest rates in terms of their
divergence from the average. T h e diagram has been so
drawn as to reflect only those changes which occur from
one season to another, with the result that each line
represents a typical year, one before the Federal Reserve
system was established, and the second after its es
tablishm ent; and emergency developments extending
through several years, such as those centering in 1896,
1907, and 1920, are not reflected.*
In the past five years it is apparent that though sea
sonal demands for credit were as usual superimposed on
the demands otherwise prevailing, rates of interest re
flected the m ovem ent of the seasons to a much less degree
than before the Reserve system was established. I t is
also true that during these latter years the Reserve Banks
furnished a means whereby the volume of credit expanded
and contracted as the demand for it increased and
diminished. In former years the rigid banking system
of the country could not respond to such changes in the
demand, because the supply of credit was relatively
constant. T h e wider fluctuations of interest rates re
flected that comparatively fixed supply, which was in
adequate at one season and possibly excessive at another.
W ith the establishment of the Reserve system, which
provides a means whereby the supply of credit is re
sponsive to the demand, it is natural that the seasonal
variations which formerly obtained should in a con
siderable measure be smoothed out.
Savings Bank Deposits
Following the semi-annual crediting of interest on
January 1 the aggregate deposits of each of the reporting
savings banks in the Second Federal Reserve District
showed a net gain between Decem ber 10 and January 10.
T h e increase in deposits of eleven N ew Y o rk C ity banks
was substantially more than the amount credited as
interest on January 1, indicating a continuation of the
increase in savings balances in evidence last year. For
the ten reporting banks in cities outside N ew Y o rk C ity
the net increase for the month was probably less than the
amount credited as interest on January 1, an evidence
of further withdrawals of savings balances.
Deposits
in these ten banks on January 10, 1922, were less than
on January 10, 1921.
T h e net increase in deposits in 21 reporting banks in
the district in the year ended January 10, 1922, com
pares as follows with the increases in previous years.
Year Ended
January 10,
January 10,
January 10,
January 10,
1919
1920
1921
1922
Per Cent.
Increase
4.2
8 .8
9.8
4.3
*By way of technical explanation, it should be stated that the figure
for each week is the median percentage deviation from a fifty-two week
moving average. The data for 1890 to 1908 were taken from the
Report of the National Monetary Commission, Vol. 22 (1910).
The following diagram shows the changes which have
taken place b y months.
PERCEN
T.
Deposits of 11 Savings Banks in New York City and 10 Savings Banks
in the Second District Outside New York City. (Average Deposits in
1918 = 100 per cent.)
Bill Market
Firmness of money rates during the latter part of
Decem ber caused a lack of investment demand in the bill
market, and dealers’ portfolios increased. Th is phase was
succeeded by a sharp revival of investment demand early
in January accompanying easier m oney conditions.
Dealers reduced their bid rates for prime bills b y succes
sive changes from 4 ^ per cent, to 3 % per cent, and made
proportionate reductions in offering rates down to 3 %
per cent. Later in the m onth both rates advanced }/%
as the supply of free funds became somewhat more
restricted.
During the latter part of December the discount market
availed itself of Federal Reserve B ank facilities to a con
siderable extent but during the first part of January
entirely liquidated its position at the bank as money
became easier.
N ew offerings of bills in the market were in moderate
volume and consisted principally of bills in connection
with the export of cotton and grain and the import of raw
sugar, coffee and silk.
Commercial Paper
In the second week of January, 4 % per cent, became
the ruling selling rate for prime commercial paper com
pared with 5 per cent, previously prevailing. Some sales
of high grade paper were made as low as 43^ p ercen t.
W ith the upward tendency of other m oney rates in the
third week of January, the commercial paper market
became somewhat firmer, bu t 4 % remained the ruling
rate.
T h e lowering of rates accompanied an increased volume
of sales, particularly in N ew Y o rk C ity . T h e number of
consistently large buyers in this market remained limited,
but there was some broadening in the list of intermittent
buyers and m any dealers found this city their best market.
FEDERAL RESERVE AGENT AT NEW YORK
The country demand tended to be somewhat less active
as lower rates came into force.
Supplies of paper increased early in January, but not
to the same extent as did the demand, and dealers’ lists
in consequence remained short.
Larger offerings were
due in part to first-of-the-year borrowing, and to lower
bid rates. Later in January, the volume of offerings again
diminished, as m any borrowers filled their needs and as
firmer money conditions caused dealers to be somewhat
more cautious in lowering bid rates.
T h e accompanying diagram indicates that the out
standing paper of dealers who report regularly to this
bank, after a rise in N ovem ber, declined during Decem ber
to the lowest point in over three years. This decline was
probably due in part, at least, to seasonal causes, as
December is normally a month of decreased paper dis
tribution.
M IL L IO N S OF
DOLLAR.S
3
Th e time money market opened the year on a 5 per
cent, basis, bu t in the first two weeks declined to a range
of 43^2 to 4 % per cent., the lowest quotations since 1917.
Accom panying, however, the firmer call money rates of
the third week, time loans on January 20 advanced again
by M o f one per cent.
Stock Market
T h e stock market entered 1922 with prices, on the
average, not far from those prevailing at the opening of
1921, with the difference that the prices of January, 1921,
were the lowest figures reached at the end of a year’s
decline, while this year’s figures are close to the high
quotations of a five m onths’ upward m ovem ent.
T h e first few days of January, 1922, brought some re
action in industrial stocks, due partly to the announce
ment of financial difficulties involving several well known
banking and business concerns, some unfavorable divi
dend actions, and renewed declines in prices of a few
important commodities.
A n upturn in stock prices
accompanied easier money conditions, and in the third
week of January representative railway and industrial
averages reached new high levels for recent months.
T o tal stock transactions on the N ew Y o rk Stock
Exchange in Decem ber were 1 7 ,000 ,0 00 shares, 29 per
cent, less than the heavy trading of Decem ber, 1920.
For *the year 1921, trading amounted to 17 1,00 0,00 0
shares, or 25 per cent, less than in 1920.
United States Government Securities
Following a reaction of 2 to 3 points in Liberty bond
prices in Decem ber the market became active and during
the period of easier conditions in the money market early
in January, prices rose slightly above the highest levels
previously reached in the current upward movement.
In the latter part of the m onth prices again declined
somewhat.
Stock Market Money Rates
T h e rate for Stock Exchange call money which was
oj/2 per cent, on January 3, declined gradually to a pre
vailing rate of 3 ^ per cent, in the second week of January.
Closing rates on two days reached the 3 per cent, level,
the lowest since N ovem ber, 1919. These lower rates
accompanied the release of funds from holiday trade,
first-of-the-year settlements, a substantial increase in
out-of-tow n funds in this market, and disbursements of
Government funds without corresponding withdrawals
from the banks.
In the third week of the m onth the supply of surplus
funds seeking investment became greatly reduced through
heavy buying of securities, large paym ents by banks and
banking houses to the Federal Reserve Bank on account
of loans and to the account of the Treasurer of the United
States, and some withdrawals of funds b y out-of-tow n
correspondents of city banks. A s a consequence call loan
renewal rates m oved upward to
and 5 per cent, and
closing rates twice touched 6 per cent.
T h e demand for V ictory notes has been particularly
broad recently, as their approach towards maturity has
made them comparable with Treasury certificates and
commercial paper as a medium of short term investment.
In sym pathy with lower rates in these competing markets,
the 3 % Per cent, notes rose to 100.26, and the 4 % per
cent, notes to 100.30, the highest price at which the
latter issue has ever sold.
December trading in United States Government securi
ties on the N ew Y o rk Stock Exchange amounted to
$221,000,000, a total somewhat larger than in any previ
ous month of the year, but 45 per cent, less than trans
actions in December, 1920. T h e total trading for the
year 1921 was $ 1 ,9 5 7 ,0 0 0 ,0 0 0 , or 32 per cent, less than in
1920, and the smallest volume since 1918.
Treasury certificates were likewise in unusually active
demand early in January. Selling rates for the longer
maturities declined about 34 of one per cent, during the
first three weeks of the m onth and were little affected by
the upward reaction in other money rates in the third
week. Rates for the nearer maturities, however, reflected
more closely variations in the money supply in this market.
4
MONTHLY REVIEW
O n January 26 the Secretary of the Treasury an
nounced an offering of $ 4 0 0 ,0 0 0 ,0 0 0 or thereabouts of
Treasury notes dated February 1, 1922, and maturing
on M arch 1 5 ,1 9 2 5 . T h e rate was 4 % per cent., as com
pared with 5 % on the issue of three-year notes issued
last June. T h e Secretary of the Treasury reserved the
right to allot additional notes up to $200,000,000 or
thereabouts, to the extent that paym ent was tendered
in V ictory notes. T h e offering was a part of the Trea
sury’s refunding programme.
Bond Market
T h e market for corporation and miscellaneous bonds
responded with vigor to the freer supply of money early
in January. Trading was resumed on a scale even ex
ceeding that of late N ovem ber and early December, when
the market was exceptionally active, and prices rose
sharply from the lower levels that had been reached during
Decem ber. Representative averages of corporation issues
again reached or exceeded the highest point of the fall
rise, which had been the m axim um level since 1919.
W ith the recurrence of firmer money conditions after
the middle of January, the volume of trading decreased
and price movements became somewhat irregular.
Foreign government bonds, on the average, m oved with
the general bond list. British issues, however, and Jap
anese bonds payable in sterling at current exchange rates,
were generally strong both in December and in January.
Between Decem ber 1 and January 20, prices of British
loans rose from 1 to over 4 points, and Japanese issues
from 3 to 5 points. T h e Japanese 43^s, payable in sterling
at fixed exchange rates, were also somewhat firmer.
Decem ber transactions on the N ew Y o rk Stock E x
change in bonds other than U nited States Government
securities amounted to $203,000,000, the largest total for
a single m onth since 1904. T h e total transactions for
the year 1921 were $1,367,000,000, the largest amount in
recent years, and 22 per cent, larger than for 1920.
New Financing
N ew financing on a large scale continued into January,
and resulted in considerable congestion in the market dur
ing the early days of the month, particularly as some issues
were brought out at rates lower than those generally
prevalent. E asy money conditions during the first half of
the month, however, assisted materially in the final dis
tribution and in the third week of January the demand
was again good and there was some increase in offerings.
January offerings included a wide variety of issues,
m ost prominent of which were State soldiers’ bonus bonds
aggregating $30,000,000, a railway bond issue amounting
to $30,000,000, and $40,000,000 bonds of the Government
of the D u tch E ast Indies. Rates on the new issues
indicated that whereas some corporation issues m ay be
sold on a 6 per cent, basis or lower, m any borrowers still
find it necessary to pay rates ranging as high as 7 and 8
per cent. T h e D u tch E ast Indies bonds, bearing 6 per
cent, interest for 25 years, but callable after ten years
at par, were sold at prices to yield 6.75 per cent, if held
to the nearest redemption date, the lowest yield thus far
offered on foreign bonds in the current market.
T h e total of new issues for the first three weeks of
January was nearly $240,000,000, a much larger amount
than in the corresponding period of last year, but smaller,
in terms of weekly rate, than in December, which was one
of the most active months of last year. For the year
1921, the volume of new corporation issues was less than
the 1920 volume, but due to increases in offerings of State,
county, and municipal bonds, foreign government loans,
and Federal Land Bank bonds, the total of all offerings
in 1921 was larger than in 1920, although slightly smaller
than in 1919.
T h e following table shows comparatively offerings o f
various classes of securities during 1919, 1920, and 1921,
as compiled in preliminary form by the Commercial and
Financial Chronicle.
(In millions of dollars.)
1920
1919
1921
Percent.
Percent.
Percent.
Am
ount Refund Amount Refund Amount Refund
ing
ing
ing
8.6
0.0
0.0
Corporate.................... $2,740
Fore ign Government..
515
Federal Farm Loan . . .
War Finance Corp. . . .
Municipal (U. S.)........
691
Municipal (Canadian) .
93
Municipal (U. S. Poss.)
15.9
55.2
$2,967
291
1.9
80.1
683
53
16
1.7
14.1
T otal.................... $4,361
18.5
$4,010
9.4
110 0.0
200 0.0
12 0.0
34.4
0.0
$2,420
385
24.7
13.0
$4,231
15.5
122 0.0
0.0
i,203
0.7
0.0
76
0.0
25
Foreign Exchange
Foreign exchange rates m oved within an exceptionally
narrow range during the past m onth. Some irregularity
prevailed during the last week of Decem ber bu t during
January rates generally remained unchanged or m oved
slightly higher.
Trading was in limited volum e, con
sisting mainly of routine transactions.
T h e following table shows the changes that occurred
in the principal exchanges during the month.
Country
January 20
Last
England..................................
France....................................
Italy.......................................
Germany................................
Belgium..................................
Holland..................................
Switzerland........................
Spain.......................................
Sweden (Stockholm).............
Argentina...............................
Brazil......................................
Japan (Yokohama)...............
China (Hong Kong)..............
China (Shanghai).................
India.......................................
Canada...................................
Bar Silver in New York.......
$4.2100
.0811
.0437
.0050
.0777
.3642
.1940
.1490
.2493
.3348
.1239
.4763
.5488
.7388
.2688
.9469
.6500
*Silver Exchange Basis.
Change
Per Cent.
from
Depreciation
December 20 from Par
0
—.0021
— .0009
0
+ .0001
— .0040
— .0005
— .0007
—.0002
+ .0002
— .0027
+ .0093
0
- .0275
-.0100
+ .0119
-.0 1 7 5
13.5
58.0
77.4
98.0
59.7
9.4
+ 0.5
22.8
7.0
21.1
61.8
4.5
*
*
44.8
5.3
5
FEDERAL RESERVE AGENT AT NEW YORK
Foreign Trade
In spite of reduced shipments of cotton and wheat,
December exports, which were valued at $296,000,000 as
reported by the Departm ent of Commerce, were slightly
higher than during N ovem ber. Shipments of corn and
certain other foodstuffs were in heavier volume. Imports
increased $26,000,000 to $237,000,000, due largely to
heavier receipts of some foodstuffs such as coffee, and of
materials for use in manufacturing, such as rubber,
hides, and silk. A s a result, the export balance, $ 59,000,000, was the lowest reported since October, 1914.
T h e total figures for the year 1921 show a decline of
45 per cent, in exports and 52 per cent, in imports as com
pared with 1920; and the excess of exports was smaller
than in 1920 because of the greatly reduced trade m ove
ment. Th e detailed figures since 1913 are shown in the
following table.
(Figures in millions of dollars)
Previous to 1921 the largest am ount of m onetary gold
held in the country was $3,095,000,000 in July, 1919.
T h e imports and exports for 1921 are shown in the follow
ing table.
Imports
(000 omitted)
Country
England.......
France..........
Canada........
China& Hong
Kong........
British India.
Netherlands .
Germany. . . .
So. America..
All Other.. . .
Second Third
Fourth
First
Quarter Quarter Quarter Quarter
$51,163
45,235
4,679
20,553
$51,087
28,103
37,941
4,535
$57,813
79,972
12,252
5,931
12,508
8,081
1,557
3
6,069
13,687
6,804
9,065
14,159
4
6,175
24,534
3,648
10,049
2,785
16,342
5,831
20,611
Total
1920
Total
1921
$42,028 $202,091 $274,982
48,739
37,378 190,688
66,356
2,036
11,484
34,196
36,856
5,837
614
4,815
1,392
3,578
6,162
16,803
23,574
32,010
19,893
19,927
24,237
75,635
30,193
2,099
8
14,496
21,955
Total Impts.. $163,535 $182,407 $215,234 $130,091 $691,267 $428,704
Exports
1913............................
1914............................
1915............................
1916............................
1917............................
1918............................
1919............................
1920............................
1921............................
Imports
Excess Exports
$2,484
2,114
3,555
5,483
6,231
6,149
7,920
8,228
4,485
$1,793
1,789
1,779
2,392
2,952
3,031
3,904
5,278
2,509
$ 691
325
1,776
3,091
3,279
3,118
4,016
2,950
1,976
Exports
China& Hong
Kong........
Mexico.........
Sweden.........
Canada........
British India.
All Other.. . .
Total Expts..
Current buying during January was closely restricted.
Orders for cotton are being filled largely from stocks of
American cotton shipped on consignment.
There was
little export buying of wheat except for the account of
the American Relief Commission and for Greece. Ger
m any and the Scandinavian countries were the principal
purchasers of corn.
Steel exporters and those handling general merchandise
report, in some instances, slightly more activity since the
first of the year, but there is little indication of increased
disposition on the part of buyers to contract for more
than pressing needs. In the foreign steel market, Cana
dian buying, chiefly of construction materials, and
Japanese purchases of sheets and tin plate, continued to
lead in point of volume, with business elsewhere generally
slow or largely confined to materials for government
projects.
Foreign demand for copper, which was active in the
closing months of last year, became slow in January.
$453
3,098
$744
920
$2,205
1,287
2,643
665
55
$6,209
1,785
49
1
1,108
1,124
108
$9,611 $59,784
7,090
18,172
2,643
2,914
5,557
1,179
6,753
443 231,825
635
506
285
$4,471
$2,219
$6,856
$10,334
$23,880 $322,091
Net Imports. $159,064 $180,188 $208,378 $119,757 $667,387 $106,613
Domestic Wholesale Prices
T h e D epartm ent of Labor index of wholesale prices for
December was at exactly the same level as in Novem ber,
49 per cent, above the 1913 average. T h e principal
changes among the com m odity groups making up the
index were a 2 per cent, decrease in food prices and a
3 per cent, increase in the prices of lumber and building
materials. Quotations for the different groups are shown
in the following table.
(1913 average = 100 per cent.)
Commodity
Group
November,
1921
December,
1921
Per Cent.
Change
Farm products.......................
Metals....................................
Foods, etc..............................
Chemicals, etc.......................
Cloths and clothing..............
Fuel and lighting..................
Building materials................
House furnishings.................
Miscellaneous........................
114
119
142
162
186
186
197
218
145
113
119
139
161
185
187
203
218
148
-0 .9
+ 2 .1
All groups.......................
149
149
0.0
Gold Movement
N e t imports of gold during Decem ber amounted to
$29,535,000, making the net imports for 1921, $667 ,387,000 against $106,613,000 for 1920. M ore than half of
the gold received during 1921 was from England and
France, while the greater part of the exports was to H ong
K o n g and M exico. T h e total stock of monetary gold in
the United States on January 1, 1922, was estimated
b y the Treasury Departm ent to be $3,657,000,000, or
about 40 per cent, of the world’s stock of monetary gold.
0.0
-2 .1
-0 .6
—0.5
+ 0 .5
+ 3 .0
0.0
6
MONTHLY REVIEW
World Wholesale Prices
T h e difference between the totals of the Departm ent of
Labor and the National Industrial Conference Board is
due largely to considerably higher figures for clothing
and for sundries in the D epartm ent of Labor index. On
the other hand, the Conference Board figure for rents is
higher than the D epartm ent of Labor figure.
Prices in England continue to work downward towards
the price level in this country. T h e January 1 index
compiled by the Statist was at 157, only 8 points higher
than the Departm ent of Labor index in this country,
and the Econom ist index stood at 162.
Prices in France were again slightly lower. In Germany
the price increases continued, but at a less violent rate
than last month.
Items
Prices in other countries for which reports are available
showed little m ovem ent in either direction. In general,
prices of food, which have m oved more freely in the inter
national markets than any other com m odity, have been
working toward lower levels, while prices of manufac
tured materials have in m any cases made moderate
increases.
Conference
Board
January 1
United States
New York City
Buffalo
150
156
169
178
151.8
217.8
145.7
190.7
150.8
196.5
161.7
179.7
i78
232.0
216.9
224.7
203.0
161.4
178.1
176.8
Food......................
Housing................
Fuel and light . . .
Furniture & house
furnishings . . . .
Miscellaneous. . . .
Cost of Living
T h e cost of living index number of the N ational Indus
trial Conference Board for a wage earner’s fam ily was
161.4 on January 1 (July, 1914 = 100). This figure is
about one per cent, lower than on Decem ber 1 and is
alm ost the same as that for June 1. For seven months
fluctuations have been within narrow limits. T h e de
cline between Decem ber 1 and January 1 was due to
slight decreases in the cost of food, clothing, and fuel
and light. Other items were unchanged.
T h e D epartm ent of Labor cost of living figure, which is
published once a quarter for individual cities, stood at
178.1 in Decem ber for N ew Y o rk C ity , and at 176.8 for
Buffalo (December, 1914 = 100). These figures are slightly
lower than those announced for M a y and for September.
T h e following table shows by different items the latest
figures reported by the N ational Industrial Conference
Board and the D epartm ent of Labor.
Department of Labor, December
Total.............
Production of Basic Commodities
T h e following table shows for a number of basic com
modities current m onthly production as percentages of
estimated normal production. In the computation of
the normals, allowance has been made for year to year
growth and seasonal variations.
Decem ber production of both anthracite and bitum i
nous coal showed a reduction from N ovem ber owing to
moderate temperatures, together with light railway m ove
ment and small bunker demand. T h e production of pig
iron on the other hand increased, foundry grades pre
dominating, as shown b y the diminished output of steel
ingots.
Zinc production and tin deliveries advanced,
Indices of Wholesale Prices
Base of 1913 = 100, unless otherwise noted
Per Cent. Change D uring
Country
Latest Quotation
October
United States:
basic commodities*...................
Department of Labor....................
Dun’s ..............................................
Bradstreet’s ....................................
Great Britain:
Economist......................................
Statist.............................................
basic commodities*...................
France.................................................
Italy....................................................
Japan..................................................
Canada................................................
Swedenf ..............................................
Shanghai t ...........................................
Calcutta H...........................................
Norway...............................................
Germany | ...........................................
|
Denmark § .........................................
Holland...............................................
12
20
107
149
136
123
(Jan. 21)
(Dec. Av.)
(Jan. 1)
(Jan. 1)
162 (Jan.
157 (Jan.
128 (Jan.
325 (Jan.
595 (Jan.
214 (Nov.
170 (Dec.
172 (Dec.
109 (Dec.
180 (Dec.
267 (Dec.
3516 (Jan.
188 (Dec.
165 (Dec.
1)
1)
21)
1)
1)
Av.)
15)
15)
1)
1)
1)
1)
1)
1)
+
+
+
2.6
1.3
1.1
1.4
+
+
-
—
-f
+
-
6.8
7.4
5.3
3.7**
3.3
6.0
1.5
3.8
1.1
- 2.8
- 1.2
- 7.0
— 0.2**
- 0.7
- 2.2
- 0.9
- 0.6
- 1.5
- 2.2 ,
- 2.5
+ 2 2 .2
+ 11
- 2.4
0.0
- 2.0
-f 34.8
- 7.9
- 6.1
^Computed by this bank, fJuly 1, 1913 to June 30, 1914 = 100.
= 100. § July,i1912 to^June, 1914 = 100. ** Revised.
November
1.9
0.7
0.5
0.3
JSeptember, 1919 - 100.
December
-
0.8
Date of High
0.0
56
45
38
45
May
May
May
Feb.
2.2
2.3
4.4
2.0
0.1
48
50
63
45
April 1, 1920
May
1, 1920
May 21, 1920
May
1, 1920
Dec.
1, 1920
Mar.
1920
May 15, 1920
Dec. 15, 1918
Sept. 1, 1921
Feb.
1, 1920
Oct.
1, 1920
Jan.
1, 1922
Nov,
1, 1920
Year
1918
- 0.1
+ 0.6
-
Per Cent.
Decline
from High
-f 1.6
- 1.1
+ 5.6
11
33
35
54
3
17
38
0
53
58
TfEnd of July, 1914 = 100.
17, 1920
1920
1, 1920
1, 1920
||M
iddle of 1914
7
FEDERAL RESERVE AGENT AT NEW YORK
keeping pace with the continued active call for galva
nized sheets and tin plate. T h e Steel Corporation has
recently been turning out galvanized sheets at 75 per
cent, of capacity and tin plate at 90 per cent, of capacity.
Copper output continued at low ebb and the Export
Copper Association still holds large stocks of copper.
Crude petroleum output was materially increased by
the high yield of the M exia field.
T h e amount of wheat
flour milled was lower, reflecting the low price of flour
and the accumulation of stocks in chief centers. Sugar
meltings increased as the price margin between raw and
refined sugar was maintained at 1.2 cents or higher per
pound.
(Normal production = 100)
1921
Commodity
Jan.
to
Mar.
Anthracite coal mined. . . .
Bituminous coal mined. . . .
Pig iron production*..........
Steel ingot production*.. ..
Zinc production.................
Lead production................
Tin deliveries......................
Copper production*............
Petroleum production.......
Gasoline production...........
Cement production...........
Cotton consumption..........
Wool consumption............
Wheat flour milled.............
Sugar meltings..................
Meat slaughtered...............
Lumber production............
Wood pulp production. . . .
^Revised
April
to
June
July
to
Sept.
103
64
57
60
51
95
93
63
27
34
38
67
48
17
104
84
90
73
106
131
89
66
31
69
100
103
79
62
70
89
85
90
78
88
66
32
37
47
62
28
26
108
92
85
67
104
107
86
99
75
74
101
73
71
Oct.
Nov.
Dec.
89
76
33
50
38
71
44
87
67
39
53
55
81
60
45
48
57
63
18
72
15
85
84
85
81
20
94
84
91
76
124
111
114
93
80
77
100f 112f
121
78
125
86
73
83
74
144
59
89
fPreliminary
Employment
T h e latest reports from the N ew Y o rk State D epart
ment of Labor and other sources indicate that the num
ber of workers employed in this district remained prac
tically constant during the past three months. A con
siderable decline in em ploym ent is normal for this time
of the year and the fact that this seasonal decline was
averted indicates somewhat better em ploym ent conditions.
During the past month there were increases in the
number employed in iron and steel plants, in metal,
machinery and railway equipment shops, in tanning
and shoe factories, and in paper mills. Such increases
were largely offset b y declines in the number employed
in automobile and shipbuilding plants, in factories that
handle food and food products, and in the textile and
clothing industries. Th e settlement of the strike in the
garment industry in N ew Y o rk C ity late in January
materially reduced idleness among needle-workers.
T h e United States Em ploym ent Service reported the
following increases in em ploym ent in this district during
D ecem ber: in the A lbany and Schenectady district, an
increase of 2.9 per cent.; in Niagara Falls, 2.4 per cent.;
in Rochester, 1.7 per cent.; in N ew Y o rk C ity , 1.5 per
cent.; and in Yonkers, 0.87 per cent. Decreases of 12
per cent, in Syracuse and 6.6 per cent, in Buffalo were
reported.
Em ploym ent agencies in N ew Y o rk C ity report that
the number of applicants for work and the number of
positions available during January were about the same
as during N ovem ber and December.
Commodity Stocks on Hand
T h e following table shows index figures for stocks of
basic commodities expressed as percentages of normal.
Sugar stocks showed a marked decrease as a result of
decreased imports accompanying larger meltings than are
usual for the m onth of December. A light demand for
coffee accompanying a high price level is reflected in
larger coffee stocks. T h e m ost striking change in stocks
of grains at primary markets was in the case of co m ,
which has been affected by heavy export shipments. T h e
reduced production of flour has resulted in lower stocks of
flour in chief centers. T h e world’s visible supply of tin
continued to increase under the influence of high prices
in London, leading to increased deliveries.
Commodity
Sugar...................................
Coffee..................................
Wheat.................................
Flour (in chief centers). . . .
Oats.....................................
Barley.................................
Rye......................................
Dairy products and eggs. ..
Poultry, frozen...................
Meats, cured and frozen. . .
Tin (world visible supply)..
Cement, Portland..............
Lead, bonded......................
Paper pulp..........................
Paper...................................
1921
April
to
June
66
114
35
87
284
198
121
133
178
100
93
126
115
99
169
153
143
1921
July
to
Oct. 1 Nov. 1 Dec. 1 Jan. 1
Sept.
54
95
108
87
643
238
295
315
104
82
94
155
134
95
191
142
138
61
72
126
123
520
161
146
452
40
65
109
131
461
371
96
402
98
74
140
137
65
113
168
165
107
129
193
202
93
91
120 122
102
88 100
88
68
51
72
88
150
458
449
74
364
96
119
59
104
147
109
35
90
91
112
517
249
75
377
165
Wages
W a ge readjustments continue. T h e m ost notable
changes reported during January were the following:
A reduction of 20 per cent, in the wages of employees in
paper mills in both the United States and Canada.
A reduction of 15 to 33 per cent, in the wages of marine
workers on American deep-sea vessels, announced by the
American Steamship Owners Association.
A reduction of 12 per cent, in wages of textile mill workers
in Utica and Cohoes, N. Y. The working week has been
lengthened from 48 to 54 hours and there will be no changes
in per capita earnings.
A reduction of 10 per cent, from $1.00 to 90 cents per hour
in the wages of carpenters in Syracuse, N. Y. This reduction
was proposed by the Carpenters* District Council, and ac
cepted by the Builders’ Exchange.
8
MONTHLY REVIEW
In N ew Y o rk C ity the tie-up of the garment industry
has been terminated after nine weeks by a court order
compelling the manufacturers to fulfil their contract
with the employees b y resuming operation on the same
basis of wages and working conditions as those previously
in force. In the building industry no new wage agree
m ent has been reached and negotiations are still under
w ay. T h e old agreement which terminated on D ecem
ber 31 has been extended pending the results of the
negotiations.
T h e N ew Y o rk State D epartm ent of Labor, in its
M on th ly Survey, found that the average weekly earnings
in factories during December were $24.91 as compared
with $24.32 during N ovem ber. T h e increase appears to
be due to increased working time on account of holiday
business and improved conditions in some lines. Earn
ings in December were 96 per cent, above the 1914 level.
Average weekly earnings in 13 selected industries through
out the United States, as reported to the Departm ent of
Labor, advanced 6 per cent, from $21.66 in N ovem ber
to $22.88 in Decem ber.
T h e accompanying diagram shows the course of average
weekly earnings of workers in N ew Y o rk State factories
since July, 1914, and compares with this total line the
average weekly earnings of office employees of the same
concerns. In 1914 office employees were receiving $19
per week as compared with earnings for all factory em
ployees of about $12.50. During the war period and
1919 and 1920 wages of operatives rose much more rapidly
than those of office workers and in October, 1920, aver
age earnings of all employees were only about $2 less than
for office employees. In terms of percentages, the earn
ings of all employees increased 130 per cent., while those
of office workers increased only 63 per cent. Since 1920
average earnings of all employees have declined 14 per
cent., but there has been practically no change in the
wages of office workers. B oth curves are influenced by
the retention of the older and experienced and hence more
highly paid employees during the past year and the
withdrawal of the less efficient. For this reason, average
weekly earnings have declined less than would have been
expected as the result of decreases in rates of pay.
Wholesale Trade
Sales b y representative wholesale concerns in this
district in December, 1921, were in general closer to sales
in the corresponding m onth of 1920 than were the N o v em
ber sales reported last month.
Gains in one or two lines
were less striking, but on the other hand there were fewer
lines in which sales were greatly retarded. In only two
lines were sales less than 80 per cent, as large as in D e
cember, 1920. W h en price changes are taken into con
sideration, it is probable that in only two lines, machine
tools and jewelry, and a possible third, stationery, was
the actual volume of transactions smaller than in D ecem
ber, 1920. Jewelry sales in particular show a sharp
recovery from those reported last month and machine
tools sales show a considerable increase. In each of
the lines reported the dollar value of sales in 1921 was
smaller than in 1919, due largely to the fact that D ecem
ber, 1919, figures were exceptionally large.
T h e following table shows the sales in Decem ber in
each line for the past three years. For purposes of com
parison, sales in Decem ber, 1919, and D ecem ber, 1921,
are expressed as percentages of the sales in D ecem ber,
1920. T h e decline in prices has been estimated.
T otal N et Sales
Dec.,
1919
'WEERDT
EARNINGS
# 4 0
Clothing..............
Drugs..................
Shoes...................
Dry goods...........
30
Diamonds...........
Jewelry...............
Stationery...........
Machine tools___
213
124
200
182
157
136
214
195
102
218
Dec.,
1920
100
100
100
100
100
100
100
100
100
100
Dec.,
1921
127
109
101
98
87
86
83
81
74
29
Per Cent.
Decline
in Price
Dec., 1920
to
Dec., 1921
Nov.,
1921*
Sales
20
15
20
10
121
110
146
112
10
20
20
70
18
25
25
25
76
73
133
66
ZO
*Expressed in percentages of sales of November, 1920.
10
0
1914 1915 1916 1917 1918 1919 1920 1921
Average Wr
eekly Earnings of All Workers in Representative Factories
in New York State Compared with Average Weekly Earnings of Office
Workers in the Same Factories. Source of Figures, Report of the New
York State Department of Labor.
Figures for Office Workers are
Available Only Once a Year
For the year 1921 as a whole, sales in all lines reported
were smaller than in either 1920 or 1919. T h e exact
comparisons are shown in the accompanying diagram
in which 1919 and 1921 sales are shown as percentages of
the totals for the year 1920. N o attem pt has been made
to adjust these figures to make allowance for changes in
prices, although it is clear that if price changes were taken
into consideration the actual volume of sales in a number
of lines in 1921 would be approximately equal to the
volume in 1920. In general, the sales of immediate
necessities compare more favorably with figures for the
previous year than do those of such commodities as
jewelry, diamonds, and machine tools.
FEDERAL RESERVE IAGENT ATJNEW YORK
1920 'SALES
100*
m i ! 99
DRUGS
1919C
m m
CLOTHING
1919c:
1921■
DRY GOODS
19I9C
19211
171
STATIONERY
1919C
m m
171
SHOES
1919C
mm
171
GROCERIES
HARDWARE
■■94
□69
174
□89
□so
□125
1919C
m m
99
170
19191=
□07
m m
1919C
19211
]103
DIAMONDS 19J9C
JC
JEWELRY
MACHINE
TOOLS
□172
97
1919C
1*211
Total Sales of Representative Wholesale Houses in the Second District
in the Years 1919 and 1921 Compared with Sales in the Year 1920
Retail Trade
N e t sales by 49 concerns operating 62 representative
department and apparel stores in this district were 4 per
cent, less in the year 1921 than in 1920, but .11 per cent,
greater than the sales of 1919. T h e 1921 figures sub
m itted b y these stores have consistently compared more
favorably with the figures of previous years than have
reports of production or trade in practically any other line.
D epartm ent store sales showed losses in nine of the
twelve months of 1921, as compared with the correspond
ing months of 1920, but these decreases were small,
ranging from / i of one per cent, in April to 12 per cent,
x
in July. In three months — February, October and D e
cember— sales were larger than in the same months of the
previous year.
T h e decline in the dollar value of sales has been much
less than the decline in average prices, furnishing evi
dence of the increase in the volume of merchandise sold
over the counters. Additional evidence of such an
increase is found in the fact that the number of individual
transactions, as reported b y stores that keep such records,
9
was consistently about 10 to 20 per cent, larger than in
the corresponding months of 1920.
T h e 1921 sales of all chain stores that report to this
bank were 4 per cent, less than in 1920, due largely to a
decline of 15 per cent, in sales by chain grocery stores,
reflecting lower food prices. T h e 1921 sales by cigar
stores and drug stores were about the same as those of
1920. T en cent stores report an increase of 5 per cent,
and chain dry goods stores a gain of 12 per cent. Sales
by mail order houses the major part of whose trade comes
from agricultural communities were 30 per cent, below
those of 1920.
A preliminary estimate of D ecem ber sales by depart
ment stores in N ew Y o rk C ity , published in this report last
m onth, indicated these were 3 per cent, greater than in
Decem ber, 1920. Com plete figures show that the increase
was actually 3.6 per cent. In the district as a whole
increases in sales by department stores in N ew Y o rk and
New ark, and b y apparel stores, more than offset declines
in sales in Buffalo, Rochester, Syracuse, Bridgeport,
Utica and other cities in the district.
T h e number of individual transactions during D ecem
ber was 15 per cent, greater than during December, 1920.
T h e average amount of each transaction declined 8 per
cent, from $2.88 in Decem ber, 1920, to $2.65 in D ecem
ber, 1921.
The following table compares December sales for the
past three years, taking sales in December, 1920, as 100
per cen t.; and also compares the total annual sales, taking
figures for the year 1920 as a base of 100 per cent.
Detailed figures for department stores are shown in
the table at the foot of the page.
M onthly Sales
Annual Sales
Dec.,
Dec.,
Dec.,
Year
Year
Year
1919
1920
1921
1919
1920
1921
Department stores..
Mail order houses..
All chain stores.. ..
99
148
89
100
100
100
102
82
107
84
98
78
100
100
100
96
70
96
Ten cent stores..
Dry goods stores .
Grocery stores. . .
Drug stores........
Cigar stores........
91
68
94
96
83
100
100
100
100
100
112
104
106
97
96
85
69
73
87
76
100
100
100
100
100
105
112
85
99
99
Business of Department Stores
M
onthly
Sa l e s
A n n u a l Sa l e s
St o c k o n H a n d
(S e llin g P ric e )
A n n u a l R a t e of
St o c k T u r n o v e r
D e c .,
1919
A ll d e p a r tm e n t s to re s ..............................................
N e w Y o r k .................................................................
B u ffa lo ........................................................................
N e w a r k ......................................................................
R o c h e s te r..................................................................
S y ra c u s e .....................................................................
E ls e w h e re in Second D i s t r i c t ..........................
A p p a r e l s to re s .........................................................
D e c .,
1920
D e c .,
1921
Year
1919
Year
1920
Year
1921
J a n . 1,
1920
J a n . 1,
1921
J an . 1,
1922
1919
1920
9 8 .9
1 0 2 .4
8 8 .8
9 4 .7
8 8 .8
9 1 .6
9 5 .1
9 8 .0
100
100
100
100
100
100
100
1 00
1 0 1 .6
1 0 3 .6
9 3 .2
1 0 3 .5
9 5 .5
9 1 .8
9 4 .8
1 0 5 .1
8 4 .4
8 4 .9
8 2 .5
8 1 .1
7 9 .3
8 2 .6
8 2 .9
8 9 .3
100
100
100
100
100
100
100
100
9 5 .6
9 4 .3
9 8 .6
9 6 .9
1 0 1 .6
9 2 .9
9 3 .2
1 0 1 .0
1 0 0 .8
1 0 1 .1
1 0 2 .2
1 0 4 .9
9 8 .7
9 4 .8
9 9 .4
9 8 .2
100
1 00
100
100
100
100
100
100
9 4 .5
9 7 .0
9 9 .9
8 9 .1
7 8 .0
7 4 .9
1 0 4 .0
8 7 .6
3 .6
3 .8
3 .0
3 .4
2 .8
2 .9
2 .6
5 .7
3 .2
3 .3
2 .8
3 .0
2 .5
2 .6
2 .5
4 .7
" 1921
3 .7
3 .8
3 .1
3 .7
3 .3
3 .1
2 .5
5 .7
10
MONTHLY REVIEW
19 a o
1 9 1 9
T h e accompanying diagrams show the m onthly fluctu
ations in sales by department stores, apparel stores, mail
order houses and five types of chain stores during 1919,
1920 and 1921. In each case the average m onthly sales
during 1919 were taken as 100 per cent.
1 9 2 .1
Stocks held by department stores, reported at the retail
price, were 16 per cent, less on January 1, 1922, than
on Decem ber 1, 1921, as a result of large Christmas sales.
T h e average amount of stock carried by department
stores during 1921 was from 15 to 20 per cent, below
the stocks carried during the preceding year. A s sales
were almost as large as those of last year the turnover of
stocks was more rapid. T h e annual rate of stock turn
over among all department stores in this district in 1921
was 3.7 tim es; 3 .2 times in 1920; and 3.6 times in 1919.
200
150
100
50
APPAREL STO ES
R
0
_1_
_L
Retail merchants placed few orders during January
except for the purpose of filling in depleted stocks in
preparation for the annual clearance sales and these
orders were for immediate delivery. Orders outstanding
on Decem ber 31 were 4 per cent, of the total purchases of
the previous calendar year.
200
150
100
M . 0 R IR. H >U5£5
AIl
C
D
1
J
A
50
J
f V
)
L
J
r
—
w
U
w
y
OD5
C H A IN 0 2Y 6G►
0
m
/
A
Ho
I
1
A
- s ,
r *
/
X
J
100
This bank has now collected sales figures from depart
ment stores for three years. T h e seasonal m ovem ent
which the figures show is so strongly marked that the
data for three years are sufficient to give a closely accurate
indication of the normal variations from month to month.
T h e accompanying diagram shows the average percentages
which sales in each month were of total annual sales.
Decem ber sales have been about 14 per cent, of the total
for each year and August sales have been smallest at
slightly under 6 per cent.
J
50
FIVE
o
1
CENT STORE}
1
1
L
i
*00
ma
io.i
150
AVERAGE
100
a .3
50
CHA N GR OCER IES
0
2-00
150
100
50
0
CH A IN (-IG A f
1
1
£00
JAN. FEB. MAR. APR. MAY JUNE JULY AUG. SEPT. OCT. W t
150
V
100
DEC.
Average Percentage of Total Annual Sales Occurring in the Different
Months in the Years 1919 to 1921. The Figures Show the
Typical Seasonal Variation in Sales
50
0
CHAIN C
>RUG5
1
r
i
r
i
19 1 9
1 9 2 .0
9 2 .1
Monthly Sales of Department and Apparel Stores in the Second Federal
Reserve District and of Mail Order Houses and Chain Stores Doing a
Country-wide Business (1919 Average = 100 per cent.)
Volume of Building
Building construction continued at a high rate during
Decem ber although normally the figures for that month
reflect a considerable decrease in activity.
Contract
awards in N ew Y o rk State and Northern N ew Jersey
11
FEDERAL RESERVE AGENT AT NEW YORK
reported b y the F . W . D odge Com pany, were 6 per cent,
greater than in N ovem ber and nearly four times the total
for December, 1920. Awards reported for the 27 north
eastern States were 3 per cent, greater than in N ovem ber.
The greatest gains were in the N ew England States where
the increase over N ovem ber figures was 44 per cent.
Aggregate awards for 1921 in N ew Y o rk State and
Northern N ew Jersey were about 7 per cent, greater than
in 1920, and were the largest of any year for which figures
are available. In the 27 northeastern States the total
amount of contracts awarded was 8 per cent, under the
1920 total. Residential construction was more than 50
per cent, greater than in 1920, but there was little con
struction of industrial buildings. W h en price changes
are taken into consideration it appears to be true that
both in this district and in the 27 northeastern States
the volume of construction was larger than for some years
past.
the percentage of firms failing to the number in business
each year since 1866, as reported by D u n ’s.
In the second diagram on this page the average liability
for each failure is brought into comparison with the m ove
ment of com m odity prices. I t is clear that there has been
a close relationship between the average liability of firms
failing and the general level of prices. T h e heavy liabil
ities of the years 1920 and 1921 are a reflection of the high
prices at which goods were purchased in recent years.
Th e average liability in 1921 was slightly under that for
1920. Aside from changes in the general level of prices,
the average size of concerns doing business throughout
the country, as judged from the average liability of
failures, appears to have undergone little change since
1857.
LIABIUff
TOSNS
H UA D
O DLAS
F OL R
P IC S
R E
P RC N .
E ET
Business Failures
Commercial failures in the United States as reported
by D u n ’s were larger in Decem ber both in number and in
proportion to the total number of firms in business than
in any m onth since the first half of 1915. T h e aggregate
liabilities were the highest ever reported b y D u n ’s for a
single month. A number of large failures among brokers
and agents in N ew Y o rk C ity brought the liabilities of
failures in this district to a high figure. December
failures included m any concerns which had been in a
precarious financial condition for m any months and the
final liquidation of these concerns does not reflect new
adverse conditions.
PER CENT.
Average Liability of Failures in the United States Each Year Compared
with Changes in Wholesale Commodity Prices. (Department of
Labor Index)
Railroad Traffic in 1921
T otal loadings of freight cars in the year 1921 were
nearly 6,000,000 less than in 1920, a decrease of 13 per
cent. T h e principal decreases were in loadings of coal,
forest products, ore and miscellaneous groups. Shipments
of grain and grain products and of merchandise in less than
car load lots, were larger in 1921 than in 1920. D etailed
figures are shown in the following table, which is com
piled from the weekly reports of the American Railw ay
Association.
(Thousands of cars loaded)
1921
Percentage of the Concerns Failing Each Year in the United States to
the Total Number of Concerns in Business
Grain and grain products.....................
T h e total figures for 1921 show that failures in that
year were larger in proportion to the number of firms in
business than in 1920, but were only slightly more than
1 per cent, of the concerns in business, which has been
on the average the normal proportion of failures. These
facts are illustrated by the diagram on this page showing
Forest products......................................
Ore...........................................................
Merchandise, less than car load lots...
Miscellaneous.........................................
1920
2,326
1,530
8,151
327
2,533
917
11,045
13,085
1,880
1,586
10,281
659
3,105
2,423
9,143
16,788
39,913
45,864
N e w
Y o r k
R e s e r v e
B a n k
O p e r a t io n s
D u r in g
1921
H E principal functions of the Federal Reserve B ank are prescribed b y law and further services to member banks
T
and through them to the whole business, agricultural and industrial com m unity, are implied in legally prescribed
functions.
A bo u t one-third of all the banking resources of the country are within this Federal Reserve district,
and the N ew Y ork Reserve Bank conducts about one-third of the business of the entire Federal Reserve system .
At
the close of business on Decem ber 31, the total personnel of the N ew Y o rk Reserve B ank, including the Buffalo Branch,
numbered 2,907 persons.
T h e expenses for carrying on the work of the bank, divided according to function, and with miscellaneous items
of overhead apportioned among the various functions, were as follows:
1. M
a in t a in in g th e
A cc o unts
of the
This work includes making about 12,500,000 entries a
year in the accounts maintained with member and
other banks, and the current determination of reserve
balances, which are required by law.............................
2. S u p p l y in g C u r r e n c y
and
$260,111
C o in .
Paying Out, R eceiving and R edeeming Currency,
involving the count of about 687,000,000 individual
notes during the year......................................................$1,247,912
Paying Out and R eceiving Coin. This service was
formerly performed largely by the Sub-Treasury, and
is now entirely in the hands of the Federal Reserve
Bank. Receipts and issues amounted to $164,000,000
for the year......................................................................
Currency and Coin Shipments to and from out-oftown banks. There were 175,000 such shipments in
and out during the year.................................................
209,826
136,310
Supplying Currency and Coin .......................... $ 2 ,8 7 9 ,2 1 2
3. M
a k in g
Loans.
M aking D iscounts and Advances to M ember Banks.
The number of items handled during the year was
149,151, aggregating $30,767,000,000...........................
$428,720
Purchasing Acceptances and T reasury Certificates
for the account of this bank and other Federal Reserve
Banks. The items purchased during the year aggre
gated $3,479,000,000.......................................................
87,682
M aking Loans.......................................................
$137,207
T elegraphic T ransfer of Funds. This service is
performed over the telegraph wires of the Federal
Reserve system, and is used by the Treasury Depart
ment and member banks. It involves making an
average of 969 transfers of funds to all parts of the
country each day, amounting to about $60,133,000
and aggregating for the year $18,160,344,000..............
94,034
$352,550
193,572
Cost of Printing N ew Federal R eserve Currency
to replace worn notes in circulation and to build up
supplies unissued and on hand, including cost of
transportation.................................................................. 1,091,592
T ax on Federal Reserve Bank note circulation, mostly
of notes in the $1 and $2 denomination. (Federal
Reserve note circulation is not taxed)..........................
Purchase and Sale of Bankers A cceptances and
other securities for member banks and foreign banks
amounting to $415,256,000 for the year, and receiving
and delivering securities for the account of member
banks, amounting for the year to about $400,125,000.
In addition the bank has acted for the Treasury
Department in the purchase and sale of Govern
ment securities.................................................................
Supplementary Services.....................................
Bank.
6. S e r v ic e s in C o n n e c t io n w it h G o v e r n m e n t L o a n s .
This work included during 1921 the receipt or delivery
of 10,520,094 individual Liberty bonds and Victory
netes, amounting to $2,879,500,000, which were ex
changed or converted or handled in connection with
registration; and the payment of 26,125,000 individual
coupons on Government bonds, notes and certificates.
It also involved the sale and issue of $1,480,000,000 of
Treasury notes and certificates, and the redemption of
$1,461,000,000 of Treasury certificates. Prior to
July 1 the cost of such operations, less miscellaneous
items of overhead, was reimbursed to the bank by
the Treasury Department. The cost to the bank
from July 1 to December 31 was..................................
$572,748
(In addition to these operations for the Treasury,
the bank performed other work for the Government
connected with the currency, the collection of
checks, the custody, purchase and sale of securities,
the transfer of funds, etc., which have been re
ferred to under their respective headings.)
7. G e n e r a l
or S u p e r v is o r y E x p e n s e s , not apportioned
among the functions specified above:
$ 5 1 6 ,4 0 2
otes a n d
C ou po n s.
Collection of Cash I tems, mostly checks. The aver
age number of checks handled was 346,100 a day, or
104,519,000 for the year, aggregating $36,100,000,000. $1,768,685
Collection of N on- cash I tems, including drafts, notes
and coupons, aggregating for the year $1,580,000,000.
Collecting Checks,
621,024
$206,385
W ork of the Federal Reserve Agent, including
note issues, examination of member banks, visits to
member banks, statistical and information services,
such as the preparation of weekly bank statements
and the publication of the M onthly R eview ............
425,933
M aintaining
4. C o l le c tin g C h e c k s , D r a f t s , N
Executive Salaries (Chairman, governor, four deputy
governors and secretary of the bank, and manager and
cashier of the Buffalo Branch).......................................
General Audit ................................
329,828
T raveling E xpenses..............
32,101
the
etc..................................... $ 2 ,3 8 9 ,7 0 9
D irectors’ Fees
T his Bank’ s Share of the Expenses of the Federal
R eserve Board.............................................................
5. S u p p l e m e n t a r y S e r v ic e s .
Custody of Securities. This service involves hold
ing in safekeeping on the average about $800,000,000
of securities for the United States Government,
$300,000,000 for the War Finance Corporation and
$100,000,000 from other sources....................................
and
General
$121,309
or
202,801
Supervisory Expenses.................$1,197,048
T o t a l .................................................................................................. $ 8 ,1 6 7 ,7 8 0
N o t e : T h i s s u m m a r y is t a k e n f r o m t h e A n n u a l S t a t e m e n t o f t h e B a n k f o r 1 9 2 1 , w h ic h g iv e s a ls o t h e c o m p a r a t i v e
S t a t e m e n t o f C o n d itio n , th e P r o fit a n d L o s s A c c o u n t a n d o th e r in fo r m a tio n .
I t w ill b e m a ile d o n r e q u e s t.
