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MONTHLY REVIEW
o f C r e d it a n d
S e c o n d
Federal R eserve A g e n t
B u s in e s s
F e d e r a l
R e s e r v e
C o n d itio n s
D is t r ic t
F ed eral R eserve Bank, N ew York
B u s in e s s C o n d it io n s in t h e U n i t e d S ta te s
RO D U C TIO N in basic industries and factory em
ployment continued at approxim ately the same
level during A p ril as in March. Factory pay rolls
were smaller, and wholesale prices declined sharply.
Distribution of commodities was maintained at higher
levels than a year ago.
P
P r o d u c t io n
The output in basic industries declined less than one
per cent, in A pril. Decreased production of iron and
steel, flour, and copper was largely offset in the Federal
Reserve B oa rd ’s production index by increases in mill
consumption o f cotton and in the production of news
print and petroleum. The output of automobiles which
are not included in the index has increased rapidly since
December and in A p ril was the largest ever recorded.
Automobile tire production was maintained at the high
level reached in March. Number of men employed at
industrial establishments remained practically the same
in A p ril as in March, but owing to less fu ll time opera
tion, particularly in the textile, leather, and food indus
tries, total factory pay rolls decreased about 2 per cent.
Building contracts awarded during A p ril were the larg
est on record both in value and in square feet.
PER CENT,
June 1, 1925
Estimates by the Department o f A griculture on May 1
indicated a reduction of 6 per cent, from the A p ril
forecast in the yields o f winter wheat and rye. The
winter wheat crop is expected to be 25 per cent, smaller
than last year and the indicated yield o f rye is 9 per
cent. less.
T r ad e
Wholesale trade was smaller in all lines except hard
ware during A p ril than in March. Compared with a
year ago sales o f groceries and shoes were less but sales
o f meats, dry goods, and drugs were larger. Sales at
department stores and by mail order houses showed
more than the usual seasonal increase in A p ril and were
larger than during A p ril 1924. Wholesale stocks o f
groceries, shoes, and hardware were smaller at the end
o f A p ril than a month earlier, while dry goods were
larger. Merchandise stocks at department stores showed
less than the usual seasonal increase in A p ril but were
in about the same volume as a year ago. Freight-car
loadings of merchandise were greater than in March and
larger than in any previous A pril.
P r ic e s
Wholesale prices, according to the index o f the Bureau
o f Labor Statistics, declined 3 per cent, in A pril, fo l
lowing an almost uninterrupted rise since the middle of
PERCENT.
156
WHOLESALE
PRICES
1 1 5=100
9*
Index of 22 Basic Commodities Corrected for Seasonal Variation
(1919 = 100 Per cent. Latest figure, April)
1922
,1923
192,4
1925
Index of U. S. Bureau of Labor Statistics. (1913 = 100 Per cent,
base adopted by Bureau. Latest figure April.)
MONTHLY
2
REVIEW, JUNE 1, 1925
PER CENT.
Indexes of Factory Employment and Factory Payrolls in Manufac
turing Industries (1919 average =100 Per cent.
Latest figures April.)
Member Bank Credit. Weekly figures for Member Banks in 101
leading cities. (Latest figures, May 13.)
1924. A ll groups of commodities shared in the decline
o f prices except house furnishings and the miscellaneous
group. The largest declines were in farm products and
foods, which had shown the most rapid increases. D ur
ing the first three weeks in May prices of grains, beef,
hogs, flour, and rubber advanced, while declines occurred
in cotton, lumber, and iron prices.
the interior prime paper sold rather freely at 3 % per
cent., and in some instances, where the m aturity was
short, at 3 ^ per cent. Dealers continued to report small
lists o f paper, and at the end o f A p r il the total volume
outstanding through 26 dealers showed a decline o f
1 per cent, from March to only slightly above the low
point o f December.
In the bill market, on the other hand, the supply o f
bills was in excess o f the demand, notwithstanding rela
tively easy money conditions and increased offerings to
this bank. Reflecting this condition, dealers on M ay 20
advanced their rates % o f 1 per cent, to 3 % per cent,
on their purchases o f 90-day bills and 3% per cent, on
their sales. Yields offered on short term Treasury issues
remained virtually unchanged.
Stock Exchange time money rates held unchanged and
unusually steady in May at 3% -4 per cent, or approxi
mately 1/2 o f 1 per cent, below the M arch level. Call
loan rates were typically 3 % per cent., though occasional
advances occurred to 4 per cent, and in the latter part
of the month the rate fo r new loans touched 4 ^ per
cent.
B
a n k
C
r e d it
A t the middle o f M ay total loans and investments of
member banks in leading cities were near the level which
has prevailed, with only minor fluctuations, since the
first of the year. Loans chiefly fo r commercial purposes
declined slightly between the middle of A p ril and the
middle of May, while loans on securities rose to a high
point at the end of A p ril and decreased somewhat dur
ing the first two weeks of May. Total investment hold
ings which increased considerably during the first half
o f March have declined somewhat since that time. Net
demand deposits increased considerably from the low
point at the end of March, but were still $500,000,000
less than at the middle of January.
A t the Reserve Banks there was a marked decline in
the volume of member bank borrow ing after the first
week in May and total earning assets of the Reserve
Banks on May 20 were less than $1,000,000,000 for
the first time since January. Acceptances and holdings
o f United States securities on that date were in about
the same volume as a month earlier.
Money conditions continued relatively easy during the
latter part of A p ril and the first part of May. A t 3% -4
per cent, the open market rate fo r prime commercial
paper was slightly below the level for the preceding
month.
M ILLION^
OF DOLLARS
M o n ey M ark et
Easier money during A p ril and most of May reflected
the moderate character of credit demands.
In New Y ork City the commercial paper market re
mained quiet and generally firm at 4 per cent., but in
Security M arkets
Stock trading increased in activity in M ay and prices
continued the recovery begun in A pril. Industrial price
3
FEDERAL RESERVE AGENT AT NEW YORK
averages reached new high levels, and while railroad
averages failed to make a fu ll recovery, shares of some
o f the individual roads got close to or exceeded previous
high levels.
A ccom panying relatively easy money conditions the
bond market continued strong.
Government bonds
reached new high levels fo r the year and high grade
corporation bond averages attained new high levels
since 1917.
New security issues continued in large volume and
brought the total since the first o f the year to over 2%
billion dollars, compared with 2y2 billions in the corre
sponding period o f last year. The chief issue was an
offering o f $60,000,000 New Y ork City bonds, which on
a 4.045 per cent, basis was reported to have brought the
highest price to the city in recent years. Foreign offer
ings during the month totaled only $30,000,000, a de
crease as compared with the previous month. Since the
first of the year, however, the total of such issues was
$400,000,000, about $35,000,000 larger than in the same
period of last year.
Foreign Exchange
Resumption of gold payments by Great Britain was
followed by a further advance in sterling exchange to
a new high point o f $4.86 in the latter part o f May,
within a cent o f gold parity. Reports issued by the
Bank o f England indicated a loss of about £2,100,000
gold in the two weeks ended M ay 13 chiefly to India,
Australia, and Switzerland, but as the return for May
20 showed an increase o f £2,290,000, there was a slight
net gain fo r the bank during the period.
Dutch exchange was also firmer during the month,
and Swiss rates continued above par. French, Belgian,
and Italian exchanges, on the other hand, tended lower.
Danish and Norwegian exchange continued strong at
levels 23 and 29 per cent, above the low point o f last
year, though still 30 and 37 per cent, below parity. The
Canadian dollar continued at or above par, while the
Argentine peso advanced to 40.55 cents, the highest
since J uly 1920. Japanese yen continued to fluctuate
around 42 cents, and Indian and Chinese exchanges
were slightly firmer.
balance for the country in A p ril and for the Port of
New Y ork at least in May.
(In thousands of dollars)
I
Imports
Exports
D ecem ber................................................................................................
January....................................................................................................
February.................................................................................................
M a rch ......................................................................................................
A pril.......................................................................................................
M ay (1 to 2 5 )* ......................................................................................
10,274
5,038
3,603
7,337
8,870
7,470
39,675
73,526
50,600
25,104
21,604
9,419
T o ta l....................................................................................................
42,592
219,928
*Port of New York only.
Foreign Trade
In A p ril both exports and imports of merchandise
declined as compared with March, but continued sub
stantially above the figures o f a year previous. In the
case o f exports the decline from March was $53,000,000,
accounted fo r in large part by a decrease o f $35,000,000
in the value o f cotton shipments, which, however, were
25 per cent, greater than in 1924. The value o f grain
exports continued large in A p ril and was almost three
times as great as a year ago.
In the case o f imports, the decline from March was
$36,000,000, accom panying a substantial decrease in rub
ber receipts. Compared with last A p ril the increase in
imports was due in part to a 50 per cent, increase in the
quantity o f silk imports, and higher values fo r rubber
imports, though in tons the figures fo r rubber were 35
per cent, smaller.
The follow ing table, giving the foreign trade figures
for each month in millions o f dollars, reflects the sub
stantial increase both in imports and exports thus far
this year over last year.
(In millions of dollars)
Imports
1924
1925
Exports
1924
1925
January.............................................................................
February..........................................................
M arch................................................................................
A p ril.....................................................................................
296
332
320
324
346
333
385
349
395
366
340
347
446
371
453
400
T o ta l................................................................................
1,272
1,413
1,448
1,670
Gold M ovem en t
The gold export movement, which began in December
and reached a maximum in January, has continued to
diminish steadily. D uring the first 25 days of May
exports through the P ort of New Y ork totaled only
$9,400,000, while imports amounting to $7,500,000, were
the largest for any similar period since November.
The follow ing table shows gold exports and imports
fo r the country from December to A pril, and for the
Port o f New Y ork only during the first 25 days o f May.
O f the export shipments, $15,000,000 in both March and
A pril, and $6,250,000 in May, represented withdrawals
by the Reichsbank o f gold which had been earmarked
here for its account fo r some time. E xcluding these
withdrawals, there would have been a small import
A n Index of Trade in the Second D istrict
In the Review o f May 1 last year there was presented
an index o f trade in this country over the last 50 years,
based upon bank clearings to 1919 and since that date
upon bank debits. In this index allowance was made for
seasonal variations, changes in the general price level,
and growth of the country, so that its changes measured
closely the variations in actual volume o f trade or ex
change o f goods over this period.
It has recently been possible to construct a similar
index o f trade since 1919 in the chief cities o f this dis
trict, except New Y ork City, where debits reflect so
largely financial and Stock Exchange transactions. This
MONTHLY REVIEW, JUNE 1, 1925
index is based upon debits in the follow ing clearing
centers:
Albany, N. Y.
Binghamton, N. Y.
Buffalo, N. Y.
Elmira N. Y.
Jamestown, N. Y.
Kochester, N. Y.
Syracuse, N. Y.
Montclair, N. J.
Newark, N. J.
Northern N. J. Clearing House
Assn.
Passaic, N. J.
Stamford, Conn.
The accom panying diagram shows this index in per
centages of variation from a line representing what has
been the normal rate of increase. This line is here shown
as a flat line, but in reality it is a line of gradual slope
conform ing with the growth of population and general
volume of business. F or comparison with this new index
the index of trade for the country at large is also
reproduced.
The similarity both as to direction and time o f move
ment in the two lines reveals the close correspondence
of business changes within the district with those for the
country as a whole. It is noteworthy, however, that the
extremes of high and low points are relatively small
in this district, apparently indicating greater stability
of business during this period than for the country as
a whole. A t the present time, both in this district and
for the country, the indexes of debits are substantially
above the trend.
PERCENT.
In the textile industry, silk mills continued active
while mill consumption of raw cotton was the largest
since May 1923, and was slightly above estimated nor
mal. In the woolen industry, on the other hand, the
index of activity showed a further decline.
In the iron and steel industry, despite a decline o f
9 and 15 per cent, in the output of pig iron and steel
ingots and of 417,000 tons in the Steel C orporation’s
unfilled orders, this bank’s indexes of production were
close to estimated normal. W hile prices and production
o f pig iron declined further in M ay steel orders were
reported somewhat larger than in A pril, and prices o f
scrap were firmer.
M ining o f bituminous coal recovered steadily between
the middle o f A p ril and the middle o f May, and fo r the
month o f A p ril was 11 per cent, above a year ago.
The follow ing table gives this b an k ’s indexes o f p rodu c
tion for recent months in percentages of the computed
trend, after allowance for seasonal variation.
(Computed trend of past years=100 per cent)
1924
April
Producers' Goods
Pig iron................................................
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........................................
Feb.
Mar.
101
106
113
96
105
107
83
107
96
81
99
143
92
127
110
82
87
114
117
71
Consumers' Goods
Bank Debits in 12 Cities of the Second District and in 140 Cities
of the Country, in both cases excluding New York City,
in Percentages of the Computed Trend, After Allow
ance for Price Changes and Seasonal Variation.
1925
Cattle slaughtered..............................
Calves slaughtered.............................
Sheep slaughtered...............................
Flogs 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..............................
106
130
89
126
92
107
93
85
97
123r
lllr
114
107
97
90
125
131
102
111
119
97
121
105
101
97
119
115
83
102
158
85
103
85
104
95
78
103
134r
135r
111
110
96
93
129
112
92
104
122
101
89p
129
82
110
143
98
88
111
110
95
85
119
106
127
99
100
96
117
115
89
96
80
98
129r
117r
113
106
99
103
Apr.
102
121
112r
112
134
103
92
113
90
95
82
104
118
106
102p
98
134
139
114
* = Seasonal variation not allowed for
p —Preliminary
r —Revised
P r o d u c tio n
I n d e x e s o f B u s in e s s A c t i v i t y
Indexes o f production fo r A p ril computed by this
bank show that, despite decreases in some lines, such as
iron and steel and the woolen industry, production con
tinued generally at high levels.
The output of 376,000 passenger automobiles during
the month was larger than in any previous month, and
truck production was also larger than ever before.
Cement production and newsprint paper output were
in excess o f the corresponding month o f any previous
year, and copper production continued high, though less
than in the preceding month.
Indexes of business activity in individual lines com
puted by this bank showed mixed changes in A pril.
Railway traffic continued at a high level, and in the first
half o f May actual loadings were above all previous
years, due chiefly to the heavy movement o f merchan
dise, miscellaneous freight, ore, and forest products.
Large mail order sales reflected active retail distribu
tion in agricultural sections but in this district indexes
o f both wholesale trade and department store sales were
lower.
FEDERAL KESERVE AGENT AT NEW YORK
1,624-
Bank debits, both in this district and for the country
at large, continued at high levels, and there was a sharp
increase also in the index of building permits. The
follow ing table gives this bank’s indexes of business
activity in percentages o f the computed trend, after
allowance fo r seasonal variation and, where necessary,
for price changes.
1,62.4
(Computed trend of past years=*100 per cent)
1925
1924
Feb.
Mar.
Apr.
108
105
94
95
103
113
104
106
106
108
93
96p
120
97r
96
107
116
98
96r
112
lOOr
97
97r
93r
93
109
117
97
95r
102r
105r
109r
117r
HOr
121r
103
Apr.
Primary Distribution
Car loadings, merchandise and m isc.......
Car loadings, other......................................
Wholesale trade, Second D ist...................
E xports...........................................................
Im ports..........................................................
Grain exports................................................
Panama Canal traffic..................................
104
102
100
90
112
75
129
Distribution to Consumer
Department store sales, Second D is t.. . .
Chain store sales..........................................
Mail order sales.. ........................................
Life insurance paid fo r ...............................
Magazine advertising..................................
Newspaper advertising...............................
General Business Activity
Bank debits, outside of New York C ity.
Bank debits, New York C it y ...................
Bank debits, 2nd D istrict, excl. N. Y . C.
Velocity of bank deposits, outside of New
York C ity ..................................................
Velocity of bank deposits, New York
C ity .........................................................
Postal receipts..........................................
Electric pow er..........................................
Employment, N. Y . State fa ctories...
Business failures......................................
Building perm its......................... ............
97r
97
108
120
102
100
101
100
90
109
65
100
105r
99
102
lllp
106r
113r
102
99r
lOlr
98r
lOlr
112r
98
104
93
96
181
HOr
95
105
93
105
163
lOlr
103
104
97
108
141
*93
122
192
p Preliminary
r= R evised
B u ild in g
Contracts awarded in New Y ork and Northern New
Jersey in A p ril were again much below the level o f a
year ago, and for the first fou r months o f this year
were nearly 30 per cent, smaller than last year. Due,
however, to large increases in other districts, the A p ril
total fo r the country was the largest ever reported, and
for the first fou r months o f the year was 7 per cent,
larger than in the corresponding period o f any previous
year.
B uilding permits, which precede contracts, also
showed in A p ril a large increase over last year for the
country, and in the case o f permits the increase was
shared by New Y ork City, where the A p ril figures last
year were relatively small due to expiration of the tax
exemption privilege fo r residential building at the end
of March. F or the first four months of this year, how
ever, permits fo r this city continued substantially
smaller than a year ago.
Illustration o f the recent tendencies in building is
shown by the accom panying diagram, which compares
contracts for the first fou r months of this year by dis
tricts and by types o f construction. In all districts
except New Y ork the value of contracts has been equal
to or larger than a year ago. Despite the heavy build
ing of recent years, the volume of residential construc
tion fo r the country as a whole continues close to the
high level of last year.
1st 4 M os.
1924
‘ 97
lOOr
102
N.Y.STATE G
r
NORTHERN N.X
1st 4 Mos.
1925
Value of Building Contracts Awarded in 36 States in First Four
Months of 1924 and 1925, by Districts and by Types of
Construction.
(Figures in millions of dollars.)
A u t o m o b i l e O u t p u t a n d B u il d i n g
In foregoing paragraphs figures were given showing
that in A p ril both automobile production and the value
o f building contracts awarded reached new high levels.
The follow ing diagram, com paring the figures by months
since 1919, indicates that over almost this entire period
there has existed a rather remarkable correspondence
between the two sets o f figures, even apart from seasonal
variations, and notwithstanding that one is in terms o f
quantity and the other in terms o f value.
A m ong influences tending toward a close relationship
between the two industries are the construction of ga
rages, service stations, factories, and other buildings
related to the automobile industry itself, and the growth
in suburban residential construction, which has been
both a cause and result o f the increased use o f auto
mobiles. In both industries also the increased practice
of instalment buying has been a large factor in the re
cent rapid expansion.
MILLIONS
OF DOLLARS
THOUSANDS
OFCARS
Value of Building Contracts Awarded each Month in 27 States, and
Monthly Production of Passenger Automobiles and Trucks.
(Latest figures April.)
6
MONTHLY REVIEW, JUNE 1, 1925
E m p lo y m e n t a n d W a g e s
F actory employment in New Y ork State declined
nearly 2 per cent, in A pril, thereby largely canceling
the increase that occurred during the first quarter of
the year. The A p ril level o f employment was 7 per
cent, above the low point o f last summer, but was still
4 per cent, below A p ril 1924. In the country as a
whole, as reported by the United States Department of
Labor, there was little change from March to A pril, as
increased employment in the production of automobiles
and in seasonal industries such as building materials
offset curtailment in other industries.
The decline in New Y ork State appears to have been
due in part to the usual seasonal slackening in apparel
m anufacturing, and in part to curtailment in other im
portant industries such as iron and steel, railway equip
ment, and woolens and worsteds. The follow ing table
shows the changes in employment in a number o f leading
industries compared with March of this year and A p ril
a year ago.
Percentage Change
March 1925
to
April 1925
Iron and steel..............................................
M achinery....................................................
Railway equipm ent....................................
A utom obiles.................................................
L eather.........................................................
Shoes.............................................................
C otton good s...............................................
Woolens and worsteds...............................
Carpets and rugs........................................
Furniture......................................................
C em ent.........................................................
B rick .......... ..................................................
— 8
— 1
— 11
+ 9
— 5
— 1
+31*
— 9
0
— 4
+ 2
+30
Percentage Change
April 1924
to
April 1925
— 12
— 6
— 3
+ 4
— 3
+ 3
+23
— 25
+ 9
— 3
0
— 23
*Labor troubles settled since March
Per capita earnings of factory workers in A p ril were
slightly below the high level o f March, apparently due
largely to reduced working time. W age scales in general
continue steady, but in the building trades throughout
the country have been advancing gradually. Common
labor hiring rates average only slightly lower than a
year ago, and are close to the highest level since 1920.
C om m odity Prices
The decline in commodity prices in A pril, reflected by
the reduction o f 3 per cent, in the Department o f
L a b or’s index, was follow ed by firmer prices in May.
This bank’s weekly index o f 20 basic commodities, after
reaching the lowest level o f the year at the beginning of
May, advanced nearly 3 per cent, in the succeeding three
weeks.
B y a further advance o f 25 cents to 70 cents rubber
reached the highest price since 1917. May wheat at
Chicago advanced from around $1.50 to above $1.70,
corn rose 15 cents, and hogs and cattle were likewise
firmer. A m ong textile materials, silk tended upward,
and wool steadied after the heavy decline of the two
previous months. Cotton, on the other hand, dropped
nearly to 22 cents, partly due to favorable crop pros
pects, but later recovered most of the loss.
Am ong the metals, copper, lead, and scrap steel re
covered somewhat, but pig iron declined to the lowest
since November 1924. Prices of raw and refined sugar
continued depressed. The accom panying diagram shows
changes in this ban k’s weekly indexes o f basic com
modity prices in this country and in England.
PERCENT.
V
/*■
rv
s
¥ *
<
PR!ice S j n
I
ENgi ,AN
i
r
r- V
J
\
“A
$
/
f
s
PR CE!5 U(
U.l5.
JAN- FEB M R PR A JU ‘JUL AUGSEPOCT- N V D JA - FEB A A R M Y JO -JU - AU - S P O T NO' * f<
- A -A -M Y N
O EO N
^M R P A N L G E - C >
' - '
1?24
192.5
Weekly Price Indexes of 20 Basic Commodities in the United States
and in England. (1913 = 100 Per cent. Latest figures May 23.)
This bank’s index o f the general price level, including
retail as well as wholesale prices, and also rents and
wages, declined in A p ril to 183 per cent, o f the 1913
level, com pared with 186 per cent, in March and 180
per cent, in A p ril last year.
Business Profits
A n indication o f the tendency o f business profits dur
ing the first quarter o f the year is provided by the fo l
lowing table, which gives net profits by quarters since
the beginning o f 1924 fo r a list o f industrial and tele
phone companies whose statements are available, and
fo r the Class 1 railroads.
D uring the first quarter this year the aggregate in
dustrial profits shown increased considerably over the
last three quarters o f last year, but were below the first
quarter o f 1924. Oil, steel, and motor accessory com
panies showed the largest increases over recent quarters,
and in the case o f motors and accessories the profits
were also slightly larger than in the first quarter of
1924. Telephone earnings continued to show an in
crease, and railroad earnings were slightly larger than
a year previous, though below the seasonal high points
in the latter part o f 1924.
(Net profits in millions of dollars)
Group
M otor and accessories.....................................
O il.........................................................................
Steel.....................................................................
Food and food products..................................
Metal and m ining.............................................
Machine manufacturing..................................
1924
1925
N o. of
Corpo
rations 1st 2 nd 3rd 4th
1st
Qtr. Qtr. Qtr. Qtr. Yr. Qtr.
13
12
12
11
11
17
14
29
13
7
5
4
17
13
17
14
84
19
5
51
19 107
11
49
6
26
4
19
6
18
32
15
30
11
8
6
9
7
5
3
Class I railroads................................................
78
70
193
118
35
208
T o ta l................................................................
341
356 314 400 422 1492 355
Total 7 groups...............................................
9
31
19
42
12
6
5
5
5
77
89
70 354 107
44
43 151
37
36
188 287 309 987 204
FEDERAL RESERVE AGENT AT NEW YO R K
7
W h o le s a le T r a d e
Sales of 200 leading dealers in 15 lines of wholesale
trade in this district were seasonably smaller in A p ril
than in March and 2 per cent, smaller than in A p ril last
year, the same decrease as was shown fo r the first quar
ter o f the year.
Comparison by individual lines revealed the chief
decreases from last year to have been in w om en’s coats
and suits, jew elry, groceries, shoes, drugs, and hardware.
Trade in silk goods, on the other hand, continued un
usually active, and substantial increases occurred also
in sales o f diamonds and machine tools.
Reports on wholesale stocks showed in A pril, as in
previous months, substantial decreases from a year ago
in stocks o f cotton goods, silks, and hardware, but in
creases in stocks o f groceries, and jew elry and diamonds.
N et Sales
Percentage Change
N et Sales
Percentage Change
April 1924
to
April 1925
New Y o r k .....................................................
B uffalo...........................................................
R ochester.....................................................
Syracuse................................ .......................
N ew ark.........................................................
Bridgeport....................................................
Elsewhere.....................................................
Northern New Y ork State...................
Central New York S ta te......................
Southern New Y ork S ta te...................
Hudson R iver Valley D istrict.............
Capital D istrict..................... *..............
Westchester D istrict..............................
Groceries...............................
M en’s clothing.....................
W om en’s dresses.........
W om en’s coats and s u its ..
C otton-Jobbers.....................
Cotton-Com mission houses
Silk goods.............................
Shoes......................................
D rugs.....................................
Hardware..............................
Machine to o ls ......................
Stationery.............................
Paper..................................... .
Diam onds.............................
Jewelry..................................
W eighted A verage..........
—3
— 23
—16
—39
—16
—26
—18
+ 2
—12
— 1
—8
— 3
—10
—12
— 17.8
Apr. 1924
to
Apr. 1925
— 7 .0
— 0.8
— 2.2
9 .9
Apr. 19241
to
Apr. 1925
+ 1 1 .7
— 18.7
+ 1.6
+ 0 .9
+ 3 1 .8
— 7 .9
— 6.8
— 6.1
+ 1 8 .2
— 3 .8
+ 0 .7
— 17.6
— (L9*
+ 6 .4
— 20! 3*
+ 9 .5
— 2.6
— 16.6
{ + 1.8
{ + 1 5 .4
— 2.2
+ 1 8 .6
— 13.2
2.2
♦Stock at first of month— quantity not value
Departm ent Store Business
A p ril department store sales in this district averaged
nearly 3 per cent, larger than a year ago, a slightly
smaller increase than occurred in the first quarter o f the
year, and somewhat less than the usual year to year
increase. A pparel store sales were about equal to those
o f a year ago, follow ing a large gain in March, when
sales were increased by early Easter buying.
Department store stocks at the end o f A p ril showed an
increase o f 2.3 per cent, over a year ago, a slightly
smaller increase than sales. The ratio o f sales, how
ever, to average stocks during the month, at selling
prices, was 31.9 per cent., compared with 32.1 per cent,
a year ago. The average amount of individual sales
transactions was $3.03, compared with $2.94 in A p ril
1924.
Whereas in March sales by departments showed the
largest increases in wearing apparel, in A pril, as indi
cated in the second table, the largest increases were in
luggage, linens, hosiery, and silver and jew elry. Mod-
1 .5
3 .5
7 .3
5 .0
6 .3
4 .8
3.1
All department stores................................
+ 2 .6
+ 2 .3
0
+ 4 .1
+ 0 .3
erate increases were reported also in furniture and
home furnishings, w om en’s apparel, and silk and cotton
yard goods.
Net Sales
Percentage Change
April 1924
to
April 1925
Stock at end of month
Percentage Change
Mar. 1925
to
Apr. 1925
—
—
—
+
+
+
+
+
+
+
+
+
—
3 .3
2 .1
6.1
3 .0
2 .6
0
0
2 .3
4 .5
3 .4
4 .6
4 .3
0 .7
Apparel stores..............................................
Mail order houses.......................................
Comm odity
Mar. 1925
to
Apr. 1925
+
—
+
+
+
Stock on Hand
Percentage Change
April 30, 1924
to
April 30, 1925
Luggage and other leather goods
Linens and handkerchiefs.....................
H osiery.....................................................
Silverware and jew elry..........................
H ome furnishings...................................
Silk good s.................................................
W om en’s and Misses’ ready to wear.
Furniture..................................................
Cotton good s...........................................
Shoes.........................................................
Toilet articles and drugs......................
M en’s furnishings...................................
W om en’s accessories..............................
M en’s and B oys’ w ear..........................
W oolen goods..........................................
Miscellaneous..........................................
+
+
+
+
+
+
+
+
+
+
+
—
—
—
—
+
Stock on Hand
Percentage Change
April 30, 1924
to
April 30, 1925
+ 7 .5
+ 4 .9
+ 0 .5
+ 0 .1
— 1.0
— 7 .0
+ 1 .8
+ 5 .5
+ 2 .6
+ 3 .8
+ 1 0 .5
+ 1 2 .4
— 1 .8
+ 8 .9
— 2 .4
+ 1.8
8 .8
8 .2
7 .9
7 .6
6 .9
6 .8
6 .5
6 .4
6 .0
5 .5
5 .2
0 .1
0 .4
0 .7
8 .3
6 .7
The diagram below, com paring department store sales
by Federal Reserve districts in the first fou r months of
this year with the corresponding period o f last year,
indicates department store trade tendencies in different
parts o f the country. E xcepting this district, sales in
the industrial northeastern section o f the country have
been generally smaller than last year, while sales in
some o f the agricultural districts o f the south and west
have shown substantial increases.
JAN.toAPR.
1924
100%
—
107
11 11
0 0
Department Store Sales in the First Four Months of this Year in
Percentages of the Corresponding Period of 1924,
by Federal Reserve Districts.
T h e
R e tu rn
to
G o ld
P a y m e n ts
in
E u rop e
T
H E announcement on A p ril 28 of the decision of
the British government to restore gold payments
in Great Britain is one of the most important of a
series o f events leading gradually to the reorganization
o f w orld trade and finance on a more normal basis.
A large part of E urope is now included by countries
whose currencies and exchanges are effectually stabilized,
government budgets balanced, and whose production and
trade have been restored to approximately the pre-war
volume.
In the map on this page the shaded portions show the
countries o f E urope which have returned to a gold or
gold exchange basis. In addition, the Swiss exchange
is quoted above par, and the exchanges of a number of
other countries have been held to fluctuations o f very
narrow limits.
Some of the more important steps which have led
gradually to this w orld recovery are indicated in the
follow ing table :
September
1922
Bank of Lithuania established and new currency
unit adopted, based upon gold.
October
Russian Soviet State Bank authorized to issue
the chervonetz, based upon gold.
November
Bank of Latvia established and new currency
created, to become convertible into gold one
year after the resumption of gold payments by
the Bank of England
January
October
January
1923
Austrian National Bank established.
German Rentenbank established, and currency
stabilized.
1924
Bank of Danzig established and currency sta
bilized with reference to sterling.
April
Sweden removes restrictions upon gold exports
and resumes specie payments.
April
Bank of Poland established, and new currency
introduced, based on gold.
June
Hungarian National Bank established and cur
rency stabilized with reference to sterling.
September
Reparations Commission proclaims the Dawes
Plan to be in effect.
October
German Reichsbank reorganized under the Dawes
Plan and new reichsmark introduced.
December
Germany removes restrictions on the export and
import of gold and silver.
J anuary
South Africa announces intention to resume gold
payments July 1, 1925.
March
Austria announces adoption of new currency.
April
Great Britain reestablishes free gold market.
Holland, Australia, New Zealand and Dutch East
Indies withdraw embargo on gold exports.
1925
The return to a free gold market in Great Britain is
a peculiarly important step, because England fo r many
years has been such an international banker, and so large
Shaded
P a rts
R epresent Countries W h ic h H ave
Gold or G old E xchan ge B a sis.
R eturned
to
a
a part o f the trade o f the w orld always has been carried
on in sterling. Certain exchanges, as indicated above,
have previously been stabilized with reference to ster
ling, and hence the return of sterling to par will auto
matically bring those exchanges to a gold parity.
The benefits likely to accrue from stabilized currencies
and exchanges are so many and so great that they can
only be summarized briefly in an article of this sort.
Instability o f the exchanges has been a constant haz
ard and a serious obstacle to w orld commerce. The
lessening o f exchange risks w ill aid greatly in the res
toration o f a free flow o f w orld trade.
A further advantage likely to result from the return
of gold payments is greater price stability. W hen gold
is moving freely it tends to be exported from a country
when com modity prices rise above the w o r ld ’s levels;
the credit volume tends to be reduced, and prices to fall.
Conversely, when prices in a country fail below the
w o rld ’s level gold tends to be imported, with the result
that the credit volume is increased and prices tend to
rise. There are, o f course, many limitations and excep
tions to the free operations o f these influences, but at
least the free movement of gold provides an automatic
tendency toward price adjustment, which does not exist
when gold movements are restricted.
Free gold movements also tend to greater stability of
interest rates, since gold tends to flow from the cheaper
to the dearer markets, and there is thus an automatic
readjustment in the capital markets.
But more important than all else, the return o f Great
Britain and other countries to gold payments marks a
return to international confidence. Confidence is at the
basis o f successful w orld trade. Since the war, all inter
national trade has been carried on in the midst o f con
stant uncertainties. E very step in lessening these un
certainties is a stimulus to international trade.
@FedFRASER