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

F e d e r a l

D is t r ic t

Federal Reserve Bank, New York

B u s in e s s C o n d it io n s in t h e U n it e d S ta te s
N D U ST R IA L and trade activity increased in Sep­
tember and is at present in considerably larger
volume than in mid-summer. The price o f cotton
has declined sharply within recent weeks, while prices
of most groups of commodities have advanced. Volume
o f bank credit has increased seasonally, and money
rates have remained firm.

I

P r o d u c t io n

Production in basic industries and factory em ploy­
ment and pay rolls, according to the Federal Reserve
B o a rd ’s indexes, after changing but little fo r about
fou r months, advanced in September to the highest
points since last spring. The increase has been particu­
larly large in textile m ill activity. Consumption o f
cotton has increased considerably, woolen mill activity
is the largest since January, and employment has
increased in nearly all branches of the textile industry.
Iron and steel production was maintained from early
in August until the latter part of October at a level
higher than fo r the corresponding period of previous
years. Automobile output was reduced in September
but continued larger than a year ago. Mining o f coal
has steadily increased since mid-summer, and the weekly
PERCENT.

Index of 22 Basic Commodities, adjusted for Seasonal Variations
(19 1 9 = 1 0 0 ). Latest figure, Sept.




R e s e r v e

November 1, 1926

run o f crude petroleum from wells in October reached
the highest level since June o f last year. Building
contracts awarded during A ugust and September were
only slightly smaller in value than the awards fo r the
corresponding period o f last year and in the first half
o f October far exceeded those o f a year ago. A sub­
stantial decline in contracts fo r residential structures
has been largely offset by increases in awards for indus­
trial and engineering projects.
The Department of
A gricu ltu re’s October 18 estimate placed cotton produc­
tion at 17,454,000 bales, an increase o f about three-quar­
ters o f a million over the estimate made on the first of
the month and o f 1,350,000 bales more than last y e a r’s
crop.
T ra d e

Wholesale and retail trade increased in September
and was slightly larger than last year. Inventories of
department stores increased slightly more than is usual
in September, and at the end o f the month were in about
the same volume as a year ago. Railroad freight car
loadings reached new high weekly records in September,
and shipments were maintained during the early weeks
o f October in much larger volume than in previous
years. A great part o f the increase as com pared with
PERCENT

MONTHLY REVIEW, NOVEMBER 1, 1926

2

Monthly Averages of W eekly Figures for Member Banks in 101
Leading Cities. Latest Figures are Averages for
Three W eekly Report Dates in Oct.

Reserve Bank Credit: Monthly averages of daily figures for 12
Federal Reserve Banks. Latest figures are
averages of first 22 days in Oct*

Money Rates at New York

last year is due to shipments o f coal and ore, but load­
ings of m anufactured commodities have also been larger.
P rices

The general level o f wholesale prices advanced slightly
in September and October, notwithstanding the drop in
the price of cotton to the lowest level since 1921. The
Bureau o f Labor Statistics index o f wholesale prices
was about one per cent higher in September than in
August, reflecting advances both in agricultural and in
non-agrieultural commodities. In recent weeks prices
o f corn, nonferrous metals, and paper have declined,
while prices o f livestock, meats, poultry and dairy
products, and bituminous coal have increased.
B a n k C redit

Between September 22 and October 20 the seasonal
increase in the demand fo r credit fo r agricultural and
commercial purposes was reflected in a continued growth
in the commercial loans o f member banks in leading
cities. Loans on securities and holdings of investments
declined, but the banks’ total loans and investments were
about $60,000,000 larger on October 20 than four weeks
earlier.
A t the Reserve Banks, the volume o f member bank
borrowing, after considerable fluctuations in response
to temporary conditions, was in October at about the
same average level as in September. There was little
change in the banks’ holdings o f United States securi­
ties, while acceptance holdings continued to increase, as
is usual at this season.
M on ey M ark et
D uring the first half o f October money rates remained
steady at the levels reached in the latter part o f Sep­
tember, but an easier tendency prevailed after the middle
o f the month. Rates at the end of the month were as
fo llo w s :




Oct. 28
1925
Time Money-90 day..............................
Prime Commercial Paper......................
Bills-90 day unendorsed........................
Treasury Certificates and Notes
Maturing Dec. 15...............
Maturing March 15............
Federal Reserve Bank of New York—
Rediscount Rate................................
Federal Reserve Bank of New York—
Buying Rate for 90 day Bills..........

* 4 ^ -5

Sept. 28
1936
*5-5 K

Oot. 28
1926

5
4 H -4 X
3%

m

3H

3.39
3.56

3.55
3.57

3.55
3 56

3H

4

4

3H

3H

3%

3%

* = Prevailing rate for preceding week.

The causes o f somewhat easier money conditions in the
second half o f October are to be foun d in a flow o f funds
to New Y ork from other districts, not unusual at this
time o f year, and a considerable excess o f Treasury dis­
bursements, including October 15 interest payments,
over withdrawals from depositaries and other collections
in the second district. There has, moreover, been some
decrease in credit demands due largely to a liquidation
in brokers’ loans amounting to nearly $200,000,000.
This decrease has been offset in part by an increase in
commercial loans o f about 140 millions, mostly in the
New Y ork district. A s a net result o f these and other
changes, total loans and investments o f the reporting
member banks throughout the country are about 90 m il­
lions under the y e a r’s high point o f September 29. In
the case o f the New Y ork City banks the decrease has
been 140 millions, or more than fo r the country as a
whole. Thus there has been a continued extension of
credit in principal centers outside New Y ork City.
Throughout the country there is no indication o f any
change o f consequence in the basic factors o f the credit
situation.
B il l M a r k et

The supply o f bills offered to the market in October
was increased substantially by the usual seasonal demand
fo r funds to finance crop movements and fall imports.
The investment demand fo r bills also im proved during
the month, though less rapidly than the supply, and

3

FEDERAL RESERVE AGENT AT NEW YORK

61W0NSOFDOLLARS

BILLIONS QFDOLLARS .

Course of Brokers’ Loans Placed in New York City by Daily
Reporting Banks from 1919 to 1925, and by Weekly Report­
ing Banks in 1926, Compared with Total Loans on
Stocks and Bonds of All Reporting Member
Banks Throughout the Country.

despite some increase in Reserve Bank purchases,
dealers’ portfolios rose to the highest levels since June.
Dealers’ rates of 4 per cent on purchases o f 90-day
bills and 3 % per cent on sales, have remained unchanged
for the past two months.
C o m m e r c ia l P a p e r M a r k e t

Open market rates on prime commercial paper con­
tinued firm in the first part of October, with the m ajor­
ity of sales at 4 % per cent. Follow ing the somewhat
easier money conditions after the middle o f the month
there was a better demand from interior institutions
and to some extent from New Y ork City banks. A s a
result, dealers’ supplies of 4 % per cent paper were
reduced, and offerings and sales of paper toward the
end of the month were largely at 4 y2 per cent. The
amount o f new paper offered fo r sale continued light.
A t the end o f September, the amount outstanding
through 26 commercial paper dealers showed a decrease
o f 4 per cent from the previous month to a total of
$612,000,000. This amount is the smallest in at least
8 years, and 14 per cent smaller than at this time
last year.
B r o k e r s ' L o a n s in P a s t Y e a r s
During the war when it was necessary fo r the New
Y ork City banks to take concerted action to exercise
some control over the money market in order to prevent
serious shortages of funds, there was inaugurated a
series o f daily reports by the New Y ork City banks to
the Federal Reserve B a r i, giving their loans to brokers
both fo r their own account and fo r the account o f cor­
respondents. These reports were made by the mutual
consent o f all the banks concerned on the understanding
that the data would be held confidential.
These reports proved so useful that they have been
continued up to the present time, with the cooperation
o f the large New Y ork City banks. A t the time o f the




Brokers’ Loans Placed by Daily Reporting New York City Banks
for Own Account and for Correspondents, 1919 to 1925.

hearings before the Congressional Joint Commission of
Agricultural Inquiry weekly figures from 1919 to the
middle of 1921 wero made available to Congress and
were published in the hearings, but otherwise they have
remained confidential.
Follow ing the inauguration by the Federal Reserve
Board in January o f this year o f a series of weekly
reports on loans to brokers and dealers, it has now
become possible, with the consent of the banks concerned,
to publish the brokers’ loan figures fo r previous years,
and the figures are shown in the accom panying diagrams.
Detailed weekly figures segregating loans for own ac­
count and loans fo r account o f correspondents are
included in the November Federal Reserve Bulletin.
It should first be noted that these back figures fo r
brokers’ loans are not directly comparable with the
figures now currently reported each week. The new
reports were extended to a somewhat larger group of
banks, 61 (on January 6) as com pared with 43 which
had been making confidential daily reports. Moreover,
the current reports are a little more comprehensive as
to the loans which they include. The relationship be­
tween the old confidential reports o f brokers’ loans and
the more recent published reports may perhaps best be
shown by com paring the figures in the two series fo r
January 1926. They were as follows, in millions of
d ollars:
Confidential
Daily
Report

Weekly
Published
Figures

2,908
2,899
2,888
2,870

3,141
3,133
3,131
3,098

Difference
233
234
243
228

Thus we see that the reports now currently published
are on such a basis that they tend to run at least 200
million dollars higher than the older series.

MONTHLY REVIEW, NOVEMBER 1, 1926

4

The first diagram compares the movement of brokers’
loans as confidentially reported fo r previous years
with the movement of total loans on stocks and
bonds, which have been published each week in the
statement of condition fo r reporting member banks.
It w ill be noted that the published figures fo r loans
on stocks and bonds follow ed much the same general
course as did brokers’ loans.
The second diagram compares the loans placed by
New Y ork City banks fo r their own account with the
loans placed fo r account of their correspondents. For
a considerable part of the period covered by the figures
the two lines run fairly close together, but fo r the
period as a whole the loans placed fo r correspondents
have increased much more than have loans placed by
New Y ork City banks fo r their own account. This may
be illustrated by com paring figures fo r the autumn of
1925 with the figures fo r the end of 1919. In the autumn
of 1925 loans by New Y ork City banks fo r their own
account were only about 30 per cent higher than in 1919,
whereas loans placed fo r out-of-town correspondents
wTere more than twice as large as in 1919.
G o ld M o v e m e n t
In consequence o f continued withdrawals o f ear­
marked gold by the Reichsbank, gold movements in
September showed an excess o f exports amounting to
$7,000,000, which reduced the net im port for the first
nine months of the year to $71,000,000.
Imports
amounted to $16,000,000, of which $12,000,000 came
from Australia and $2,000,000 from Mexico. Exports,
which totaled $23,000,000, included $20,000,000 to Ger­
many and $1,000,000 to Canada. A t the end of Sep­
tember, the recent exports to Germany had totaled
approximately $40,000,000, and total imports from
Australia were of similar amount.
Im ports and exports o f gold at the P ort o f New Y ork
during the first twenty-eight days o f October were
without special significance. Imports amounted to about
$400,000 and exports were slightly over $1,900,000, of
which $1,000,000 was shipped to Colombia.
D i s c o u n t R a t e s o f F o r e ig n B a n k s
D uring the month of October the follow ing changes
were made in rates of banks of issue abroad. In each
instance the movement was downward.
Czecho-Slovakia
Esthonia
Japan
Norway

from 6
from 10
from 7.30
from 5

to
to
to
to

5%
8
6.57
4%

on
on
on
on

October 27
October 1
October 4
October 26

F or the National Bank o f Czecho-Slovakia this is the
second reduction in the calendar year, the rate having
been dropped from 6 % per cent to 6 per cent on Janu­
ary 12, and to 5 % per cent on October 27. F or Norway,
it is the fourth change during the y ea r; the rate was
advanced from 5 per cent to 6 per cent in January, and
thereafter reduced to 5 % per cent in A pril, to 5 per cent
in September, and to 4 ^ per cent in October.




S ta b iliz a tio n o f th e B e lg ia n C u r r e n c y

A fte r a long period o f careful preparation the stabil­
ization plan o f the Belgian Government became effective
on October 25. The value o f the franc was fixed by
decree at a gold value, amounting to about 2.781 cents.
F o r international purposes a new unit of account was
created, the belga, equivalent to five paper francs, with
a fixed value o f 0.209211 grams o f fine gold or about
13.904 cents.
A n international loan o f $100,000,000 was offered by
the Belgian Government in England, H olland, Sweden,
Switzerland, and the United States, one-half of the total
being offered in the United States. The proceeds o f
this loan are to be turned over by the government to
the National Bank o f Belgium to be applied in reducing
the State’s indebtedness to the bank, which w ill be
further diminished by the application to the same end of
the profits arising from the revaluation o f the ban k ’s
existing reserves, hitherto carried at their prewar value.
A s a part o f the plans which have been completed
for the stabilization o f the Belgian currency, the Federal
Reserve Bank o f New Y ork, in association with other
Federal Reserve Banks, has indicated its readiness to
cooperate with the Belgian bank o f issue, the Banque
Nationale de Belgique, by participating with other banks
o f issue in credit arrangements under which the Federal
Reserve Bank o f New Y ork has agreed, if desired, to
purchase up to a total amount o f ten m illion dollars o f
prime commercial bills from the Banque Nationale de
Belgique. In these arrangements the Federal Reserve
System is acting in collaboration with the Central Banks
o f Austria, England, France, Germany, H olland, H un ­
gary, Japan, and Sweden.
In recent months the budgetary position o f the B e l­
gian Government has been materially strengthened,
through increased taxation, which is expected to cover
all expenditures fo r the current year and provide sub­
stantial sums fo r the sinking fu n d created to retire
public debt.
The Treasu ry’s position was improved
during the summer by the forced consolidation o f the
internal floating debt o f which the greater part was
converted into preference shares o f the new railroad
company.
The rem ainder w ill be gradually retired
through the operation o f the sinking fund. Provision
has also been made fo r the retirement o f the external
floating debt.
T h e F o r e ig n E x c h a n g e s
The principal event o f the month was the stabiliza­
tion o f the Belgian franc and the introduction of
a new unit o f account in international transactions,
the belga. Trading in the new unit commenced on
October 25, the quotation being virtually at parity.
D uring the first two months o f the year the Belgian
franc was quoted at about 4 % cents, but it fell abruptly
in M arch and by the middle o f July was selling at just
over two cents. From this level it rebounded to about
2 % cents in the first week o f August, near which figure

FEDERAL RESERVE AGENT A T NEW Y O R K

it was thereafter continuously maintained until form al
stabilization on October 25.
CENTS

rl--------

-i l \

5

USNCE

a

5,

V

■v^

T \— ' J t

t

BELGll M

H r

\

S

i ___

1

if52^SS»

. VP

(

\ W
/;rMLY

v
\

... .
1 9 2 .4

- .

----

-

f

*

.

.- _ _

F o r e ig n T r a d e
September exports o f merchandise, valued at $450,000,000, showed an increase o f $64,000,000 over August,
in accordance with the usual seasonal tendency, and an
increase of $30,000,000 over September last year. Im ­
ports, valued at $345,000,000, were $8,000,000 larger than
in August, but slightly less than in September 1925.
Most o f the gain in total exports, com pared with Sep­
tember 1925, was due to increased shipments o f grain
and coal. Compared with August, half of the gain is
accounted fo r by a large increase in the value o f cotton
exports, despite the decline in prices. The actual quan­
tity o f cotton exported was double that o f August and
the largest in any September since 1913, but the value
of September shipments at the low prices was 20 per
cent smaller than last year. Receipts o f rubber and
coffee were considerably above a year ago, and receipts
o f silk almost equaled those o f September 1925, the
record month.

1925

Course of Belgian, French and Italian Exchange Rates at Nsw
York. Last Quotations in Each Week, 1924 to 1926.

Sterling was rather weak in October, falling to
$4.84%, but at this point it was still over half a cent
above the low of October 1925. Swiss francs and Dutch
florins were heavy, the latter touching 39.95 cents, the
lowest since A p ril 1925. The German mark declined
to 23.77 cents, the lowest quotation since the mark was
stabilized. On the other hand, lire and French francs
were strong. The form er continued their advance to
about 4 % cents, the highest point in two years, and up
more than a cent from the quotations prevailing
through the month o f August. French francs rose above
three cents, compared with a quotation below two cents
in July. The Norwegian krone, after some weeks of
relative stability, made another rapid advance, from
21.90 cents on October 1 to 25.12 cents on the 22nd,
the highest quotation since the middle of 1919. The
Danish rate, at 26.63 cents, was only slightly below
parity.
The Canadian dollar continued at a slight premium,
but weakness in Argentine rates toward the end o f the
month canceled an earlier advance and Brazilian rates
also declined. The yen continued to appreciate and at
48.90 cents was at the highest point since 1923, and
within less than one cent of parity. The rupee reacted
to 36 cents.
Silver and the silver exchanges were weak. Last
January silver was quoted at 6 8% cents and was above
65 cents in early July. On October 4 the price was
5 8% cents, the highest fo r the month, but from this
point it dropped rapidly to 5 1% cents on the 19th.
There was some recovery toward the end of the month.
The reasons fo r this abrupt decline especially during the
past two months are not clear, but among the causes
may be named continuance o f disturbed conditions in
China, the reduction in recent months of In d ia ’s favor­
able trade balance, and uncertainty as to the future
attitude toward silver on the part o f the Indian
Government.




5

S e c u r it y M a r k e t s
Stock prices declined in October follow ing irregular
movements in September.
Industrial price averages
declined about 10 points to the lowest levels since June
and railroad averages 6 points to approximately the late
July levels, but toward the end o f the month, a partial
recovery occurred.
E xcept fo r a temporary decline around the first of
October, when money rates were firmer, corporation
bonds were little changed from the levels o f the pre­
vious two months. United States Government bonds,
which were slightly easier in September, advanced ^4
o f a point on the average, and the foreign list continued
active, with prices generally firm.
A m ajority of
French and German issues advanced further during the
month to the highest levels o f the year.
The volume o f new domestic securities offered dur­
ing October was slightly smaller than in September,
but was approxim ately as large as in October a year
ago. The decline from the previous month was chiefly
in industrial and railroad financing. M unicipal and
state issues continued large, and included an offering
o f $25,000,000 City o f Philadelphia 4*4 per cent bonds.
Public utility financing, which was small in September,
became more active in October. The total of foreign
securities offered in this market was somewhat larger
than in the previous m onth; the principal offerings
were $50,000,000 o f K ingdom o f Belgium 7 per cent
bonds issued in connection with the stabilization p ro­
gram in that country, and the m ajor part o f $42,500,000
Republic o f Chile 6 per cent bonds.
I n d e x e s o f B u s in e s s A c t i v i t y
This bank’s indexes o f bank debits outside New Y ork
City, which have been found to follow closely the move­
ments o f general business activity, showed an increase
from August to September in the second district, but
a slight decline fo r the country as a whole.
A high rate of activity in both domestic and foreign
trade in September is indicated by this ban k ’s indexes,

6

M O N THLY REVIEW, NOVEMBER 1, 1926

which are shown below with comparable figures fo r
recent months and a year ago.
(Computed trend of past years=100 pe” cent)

1925

Sept.

July

Aug.

Sept.

106
96
95
118
89
93

103
110
109
122
101
89

101
105
106
113
132
94

103
107
106p
121p
112

102
94
116
122
112
105
104

100
96
132
119
104
99
104

108
94
135
115
106
101
109

109
95
126
116

Primary Distribution

Car loadings, merchand se and misc.......
Car loadings, other...................................
Exports......................................................
Imports......................................................
Grain exports............................................
Panama Canal traffic...............................
Distribution to Consumer

Department store sales, 2nd Dist...........
Chain store sales.......................................
Mail order sales.........................................
Life insurance paid for.............................
Real estate transfers.................................
Magazine advertising...............................
Newspaper advertising.............................
General Business Activity

1926

ioe
107

Bank deb'ts, outside of N. Y. City........
Bank debits, New York City..................
Bank debits, 2nd Dist. excl. N. Y. C:ty. .
Velocity of bank deposits, outside of New
York City..............................................
Velocity of bank deposits, New York City
Shares sold on N. Y. Stock Exchange*..
Postal receipts..........................................
Electric power...........................................
Employment in the United States**. . . .
Business failures.......................................
Bubding permits.......................................
New corporations formed m N. Y. State

110
122
105

116
123
110

112
132
102

no

100
117
179
103
110
103
97
160
132

108
123
173
101
113r
103
100
128
126

103
132
209
98
115
104
105
137
108

98
127
173
100
i05p
94
133
112

General price level...................................

186

185

185

186

* = Seasonal variations not allowed for.
ment p=»Preliminary. r=*Revised.

123
105

A p a rtm en t R en ts
A continued gradual decline in rents o f apartments
in New Y ork City is indicated by reports received from
representative apartment house owners and managers,
covering the fall renting season o f this year. Rents of
apartments which in 1920 rented fo r less than $15
monthly per room declined 2 per cent during the past
year, while rents o f the higher priced apartments showed
on the average decreases o f 2 or 3 per cent.
In the case o f the lower priced apartments, vacancies
were reported to be more numerous than in any recent
year, as fu ll employment at high wages has created a
larger demand fo r housing o f higher grade. F o r all
classes o f apartments the practice o f granting conces­
sions to prospective tenants was reported to be frequent,
especially to fill newly completed properties.
Present rentals fo r low priced apartments are about
86 per cent higher than in 1914, and only 3 per cent
below the peak reached in 1924. Rents o f medium priced
apartments, those renting in 1920 fo r between $15 and
$30 per room monthly, are about 56 per cent above the
1914 level but are 11 per cent lower than in 1921, the
year o f highest rentals fo r this class o f apartment. The
accom panying diagram compares the movement o f the
two rent indexes tydth this bank’s index o f the cost of
construction.
PER. C E N T .

**= Supersedes New York State Employ­

B u il d i n g
F ollow ing the unusually large total fo r August, the
volume of contracts awarded fo r building and engineer­
ing projects in 37 states east o f the Rockies declined 6
per cent in September, according to the F. W . Dodge
Corporation, but was less than 1 per cent smaller than
in September 1925. F or the first nine months of this
year the total was 8 per cent larger than fo r the corre­
sponding period of 1925. In the New Y ork and New
Jersey district, construction contracts let during Sep­
tember were also somewhat smaller than in August, but
were 13 per cent larger than in September 1925.
Contracts awarded fo r residential buildings con­
tinued substantially smaller than a year previous, and
the total o f educational building was slightly smaller, but
all other principal classes o f construction projects were
larger than a year ago.
Permits issued fo r building in 463 cities reporting to
S. W . Straus & Company were 16 per cent smaller than
in September 1925. This decrease in building activity
was the largest this year and was fairly well distributed
throughout the country, although reductions in building
centers such as New Y ork, Boston, and Los Angeles,
and in Florida, were especially pronounced.
The
greater decline in permits than in contracts is probably
due to the fact that contracts include public works and
engineering projects which are not covered by permits,
while residential and commercial building, which has
been smaller than last year, constitutes a larger element
in permit records.




Rents of Apartments in New York City compared with Changes
in the Cost of Building Construction. Apartment A is the
Typical Apartment renting for less than $15 per room
in 1920. Apartment B is the Typical Apartment
renting for between $15 and $30 per room in 1920.

Demand fo r mortgage loans has continued active, but
in recent months the demand fo r funds fo r new building
enterprises has shown a tendency to diminish. The sup­
ply o f mortgage money to finance smaller buildings, such
as private dwellings and medium priced apartment
houses, continued large, but supplies o f funds fo r large
projects appear to be somewhat less readily available
than a year ago. This condition was reflected in rates
fo r mortgage money, which although unchanged from
the levels o f a year ago at 5 to 6 per cent, according to
locality and type o f property, showed a slightly firmer
tendency in that there was less money available at 5
per cent.

FEDERAL RESERVE AGENT AT NEW YORK
E m p lo y m e n t a n d W a g e s

A substantial increase in factory employment from
August to September was reported by both the New
Y ork State and Federal Labor Departments. In New
Y ork State the increase was nearly 2 % per cent, but the
level of employment was practically unchanged from a
year ago. The increase in payrolls was even larger, and
per capita weekly earnings advanced in September to
$29.31, the highest on record.
E xcept fo r a seasonal increase in the w om en’s clothing
industry, the largest increases in working forces were in
textiles. W oolen and worsted, silk goods, and knit goods
mills reported substantial increases, but employment in
cotton goods mills, the only branch of textiles operating
at a higher level than at this time of last year, increased
only slightly over August. The iron and steel, machin­
ery, automobile, and printing industries also reported
increased employment in September, while decreases
occurred in railway equipment, building materials and
leather.
Accom panying increased industrial activity, labor
turnover rates increased to the highest level since early
in 1924, and the demand fo r workers relative to regis­
trations for employment at offices of the State E m ploy­
ment Service was correspondingly high.

7

steel production continued at a high level in September,
but declined somewhat after the middle o f October.
Automobile production also remained high in September,
but some curtailment has been reported subsequently.
This bank’s indexes o f production, in which allowance
is made for seasonal variations and year-to-year growth,
are shown below.

(Computed trend of past years=100 per cent)

1925

1926

Sept.

July

Aug.

Sept.

96
105

113
104

112

108

109
116
104
108
93
116

Producers' Goods

Steel ingots................................ «.............
Bituminous coal........................................
Copper, U. S. mines..................................
Tin deliveries.............................................
Gas and fuel O'l.........................................
Cotton consumption.................................
Woolen mill activity*...............................
Leather, sole..............................................
Silk consumption * ...................................

101

103
105

109
109

124

100

113
99

122

77
139
109
70
109

110

92
96
131
106
71

100

86

99
105
96

111

117
93
92
83
130
96
73
126

93p
132

104
93
99

113
97
106

io7
74

120

m

Consumers' Goods

Cattle slaughtered....................................
Calves slaughtered...................................
Sheep slaughtered.....................................
Hogs slaughtered......................................
Sugar meltings, U. S. ports.....................
Wheat flour......................................... ..
Tobacco, manufactured...........................

Paper, total...............................................
Boots and shoes........................................
Anthracite coal.........................................
Automobile, all.........................................
Automobile, passenger.............................
Automobile, truck.....................................
*=Seasonal variation not allowed for.

100

102

107
94
113
141 i

100 \

105
80 •
108
130 5
134”
114
85
105^
5 **
127
118
163

p=*Preliminary.

121

96

100

99
96
114
106
70
107
139
124
129

86

105
103
126
134
97

112

99
103
105
73
105
141
126
124
87
103
99
145
157
99

111

ioo
110

77

112

i29

91
109p
106
144
151
115

**=Strike.

W h o le s a le T r a d e

Ratio of Workers Called for by Employers to Each IOO Applicants
for Work at New York State Employment Offices, and Ratio
of Voluntary Resignations to Total Number of Employees
of Representative Employers Reporting to the
Metropolitan Life Insurance Company.

Production
The output o f leading industries was higher in Sep­
tember than in August in a m ajority of cases, even after
allowance fo r the usual seasonal increase, and remained
substantially higher than a year ago.
A ctivity in the textile industries, excepting silk, was
considerably increased.
Coal m ining was expanded
further, and in the early part of October bituminous
output was higher than in the corresponding period of
any recent year, reflecting the unusual export demand
arising from the British strike, together with the high
rate o f industrial activity in this country. Iron and




September wholesale trade in this district averaged
4 per cent lower than a year ago, a considerably smaller
decrease than in the previous two months, due largely
to the fact that sales o f w om en’s clothing, although still
below last y e a r’s level, showed substantial improvement
compared with recent months. A ctual increases over
last year were reported in only five lines, but in shoes
and silk goods the gains were the largest so fa r this
year, and diamond sales were the largest fo r the month
of September in the past 6 years. Paper and drug
sales continued larger than a year ago.
Sales o f cotton goods continued smaller in value than
a year ago, but when allowance is made fo r the reduc­
tion o f nearly 20 per cent in prices, which is indicated by
the Textile W orld index of cotton goods prices, the
actual quantity o f goods sold in recent months appears
to have been considerably larger. Stationery sales fell
below the previous y e a r’s level fo r the first tim e,since
the spring o f 1925, and wholesale grocers and machine

MONTHLY REVIEW, NOVEMBER 1, 1926
tool dealers reported the largest decreases in more than
a year. Decreases also occurred in sales o f m en ’s cloth­
ing, hardware, and jew elry.
A t the end of the month jew elry and diamond stocks
showed a large increase over a year ago, and hardware
stocks, which were below last y e a r’s level in August,
were somewhat larger at the end o f September. Stocks
o f silk goods were slightly below the high level o f a year
previous, the first decrease in more than a year, and
decreases were also reported in shoes, groceries, and
cotton goods.
Collections continued smaller than a year ago, but in
a m ajority of reporting lines they compared more
favorably with a year ago than in August. Outstanding
accounts at the end of the month were slightly larger
than last year.
Percentage
Change
September 1926
from
August 1926

Commodity

Net
Sales
Groceries......................
Men’s clothing.............
Women’s dresses.........
Women’s coats and
suits..........................
Cotton goods— Jobbers
Cotton goods — Com­
mission .....................
Silk goods.....................
Shoes............................
Drugs...........................
Hardware.....................
Machine tools..............
Stationery....................
Paper............................
Diamonds.....................
Jewelry.........................

+12.3
— 9.2
+10.3
+125.9
+15.5

Stock
end of
month
+ 9.7

— 6.0

+19.0
— 3.2*
+10.4
+13.4 — 15.1
+39.3
+15.7
+ 1.7
— 4.2
+ 8.2
+ 7.7
+12.1
+29.8 } + 9.3

Weighted Average. . + 21.6

Collections on regular charge accounts were about 6
per cent larger, and on instalment accounts 10 per cent
larger than a year ago.
Outstanding instalment ac­
counts, however, were only slightly larger than a year
ago, whereas outstanding charge accounts were 12 per
cent larger.
A comparison of sales by individual departments
indicates a large increase com pared with last year in
sales o f musical instruments and radio, follow ing de­
creases in most previous months this year. Substantial
increases continued in the furniture, books and station­
ery, and m en ’s and w om en’s ready-to-wear departments.
Sales o f departments carrying less essential articles
were relatively slow, and sales o f silk and woolen goods
were considerably below a year ago.
Stock on Hand
Net Sales
Percentage Change Percentage Chansre
September 1926
September 30, 1926
from
from
September 1925
September 30, 1925

Percentage Change
September 1926 from September 1925

Net
Sales
— 5.9
— 4.4
— 17.3
— 11.5
— 3.6
— 7.7
+ 7.7
+13.6
+ 1.0
— 2.9
— 18.1
— 1.4
+ 2.8
+12.9
— 5.7

Stock
end of
month
— 1.6

— 0.9

Acct’s
Receiv­
able

— 1.9
+ 9.7
— 2.1

— 0.9
+15.1
— 6.4

Linens and handkerchiefs......................

— 19.1
— 8.0

Women’s ready-to-wear accessories. . ..
Toys and sporting goods........................
Men’s furnishings...................................

— 21.0
— 8.1

— i.3 * +
—29.4 —
+
—
+ 4.1

} +21.4

— 4.4

Musical instruments and radio..............

Collec­
tions

4.6
4.5
5.3
5.5

+ 16.7
+ 3.5
+ 4.6
+ 6.6

+ ’ 4:3

+ 4.7

} + 2.8 } + 1.9
— 1.6

+ 1.6

♦“ Quantity not value.

D e p a r t m e n t S t o r e B u s in e s s
September sales of department stores in this district
were 6 per cent larger than a year ago. Increases oc­
curred in most localities, and in Newark the year-to-year
gain was the largest in several months. A pparel store
sales increased 12 per cent and mail order sales 7 per
cent com pared with September 1925.

Books and stationery.............................
Women’s and Misses’ ready-to-wear. . .
Men's and boys’ wear.............................

Toilet articles and drugs........................
Home furnishings....................................
Silverware and jewelry...........................
Luggage and other leather goods..........
Silks and velvets.....................................
Miscellaneous.........................................

+32 1
+ 19.4
+ 14.8
+ 10.5
+ 9.9
+ 9.1
+ 7.6
+ 5.7
+ 4.3
+ 4.1
+ 3.7
+ 3.3
+ 1.1
+ 0.8
+ 0.1
— 1.3
— 20.5
— 22 1
— 3.7

— 10.7
+ 9.4
+ 3.8
— 11.6
— 2.0
+ 0.5
— 1.3
— 3.1
— 4.5
— 18.9
— 2.0
— 5.7
+ 12.1
+ 1.2
+ 6.0
+ 5.0
— 29 8
— 0.4
— 15.2

Stocks o f goods on hand at the end o f the month
were less than one per cent larger than a year ago. A s
the accom panying diagram shows, the increases in
stocks o f merchandise over last year have been dimin­
ishing in recent months, while sales have been high, so
that the rate o f stock turnover has been steadily
increasing.
Per

cent.

Percentage Change
September 1926 from September 1925
Locality
Net
Sales

Stock on
hand end Collec­
of month tions*

Acct’
Rece'vable*

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

+ 6.4
+ 0.4
+ 4.9
— 6.7
+14.2
+14.8
+ 4.9
— 1.8
+ 2.6
+ 7.4
— 1.6
+ 0.5
+25.6

— 0.3
— 0.2
— 0.3
— 10.4
+ 6.9
+ 3.6
+ 4.4

+ 3.0
+ 1.7
+20.9

+14.1
— 2.4
+18.7

+ '8 :8

+18.4

+ 8.9

+ '2:9

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

+ 6.4

+ 0.6

+ 5.8

+12.2

Apparel stores ............................................
Ma i order houses .......................................

+11.9
+ 7.0

+16.8

♦^Exclusive of instalment accounts.




Per Cent Increase in Sales and Stocks of Merchandise on Hand
in Representative Department Stores of the Second
District, First Nine Months of 1926 Compared
with Corresponding Months in 1925.