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F E D E R A L R E S E R V E BANK OF RICHMOND
C A L D W E L L H A R D Y , FEDERAL RESERVE AGENT

General Business and Agricultural Conditions in the Fifth Federal Reserve
District for the Month of April, 1920.
[C om piled M a y

15, 1920]

The unrest and uncertainty in commercial fields, mentioned last month, continued during April and spread
to the consumers, partly as a result of the agitation against high clothing costs. The overall movement in
itself did not prove very popular, but it undoubtedly set many people to thinking and to analyzing their expend­
itures with a consequent wide-spread effect on business. Large numbers of people were led to curtail their
purchases and encouraged to compare prices and values more carefully than they had been doing for months.
Merchants sensed this caution on the part of many customers, and, as we write, there seems a general movement
to unload high priced stocks quickly through general price reductions. In many of the cities of the District
leading stores have announced substantial reductions in all lines, 20% cuts predominating, and this movement
has spread to nearly every type of store, except those handling food. It is too early to forecast the results that
will come from this action by the merchants, but conditions are clearly uncertain, and this fact (together with
merchants’ reductions) will, it is thought, tend to further a general downward readjustment of prices.
At this writing, the most serious cloud on the horizon is the traffic tangle. The out-law strike in April
greatly added to the already distressing shortage of equipment by tying up thousands of cars at junction points,
thus as effectively removing them from useful work, for the time being, as though they had been destroyed.
Manufacturers cannot market their products, coal mines cannot operate full time, and farmers cannot secure
fertilizers and machinery until some solution of the railroad congestion is reached and applied. Credit deflation
cannot proceed very far because of the inability of merchants, manufacturers, farmers, and all others, to take
up their obligations until they can realize funds from the delivery of their products. This railroad congestion
has brought about a freezing of credit which is felt by every one.
COLLECTIONS.—On the whole, collections have held up well in the Fifth District, where the extent of
the freeze referred to above is less severe than in the Western District. Some indications point to a decided
slump in payments during the latter half of April, when the switchmen’s strike had tied up deliveries, but the
situation improved somewhat during the first few days of May. Manufacturers and wholesalers are experi­
encing more difficulty in meeting their obligations than retailers, because the difficulty of making prompt
deliveries on orders affects the former immediately more than it does the retailers. Failures are low, Dun’s
Review reporting fourteen for April, 1920, in the Fifth District, as against twenty-seven for April, 1919, with
liabilities of $88,450 this year as opposed to $660,750 during the corresponding month in 1919. The April
record is not only lower than for last year, but compares favorably with thirty-six failures, with liabilities of
$464,017, reported for March, 1920.
BANKING OPERATIONS.— Bank clearings in fifteen reporting cities amounted to $900,511,259 in April,
a gain of 26% over the corresponding month last year. Eighty-two selected banks in thirteen cities report
increased loans amounting to four million dollars, in round numbers, during the past four weeks, with net
demand deposits showing a decrease of four million dollars and time deposits an increase of almost exactly the
same amount during the same period of time. Bankers report sufficient funds available for the real needs of the
District, but careful scrutiny of applications for loans is necessary to prevent tying up of funds in speculative
undertakings, and for capital purposes. Traffic conditions are hindering efforts made by the banks to call in
some of their loans, producers being unable to liquidate their obligations until collections for goods sold can be
made after delivery.




LABOR.—The outstanding event in labor circles during April was the switchmen’s strike in the great
eastern commercial and railroad centers, but while effects of the strike were felt keenly in the Fifth District, it
did not spread into our territory. Locally, labor appears fairly well satisfied, and no serious trouble has been
reported. The southern textile operations were unaffected by the recent strike in the New England mills, and,
as reported last month, the mill owners are spending large sums in welfare work for their employees. Com­
plaint is still wide-spread as to the inefficiency of labor and the general tendency is to shirk and “ beat time”
while on the job, but conditions are slowly improving. Farm labor continues scarce, and will probably remain
sc until wages paid in the cities for unskilled labor fall materially. Tobacco manufacturers report a slight excess
of labor, but not enough surplus to bring down wages. Carpenters and mechanics are busy, and house servants,
employed at good wages, are very independent. Negro women workers are hard to get, probably due to the
fact that the Negro men make sufficient wages to maintain their families without assistance from the women.
CROP.—Prospects are not bright for average crops this year. The late spring, with cold weather up into
May, has delayed soil preparation, planting, and germination of seed. Shortage of labor and the difficulty of
securing sufficient fertilizer for proper crop production has discouraged increased acreage, except in one or two
lines. Truck crops were seriously damaged by severe weather in February and early March. Indications are
that on May 1st planting of cotton and corn was about 15% to 20% behind the usual average for that date.
There will probably be approximately the same acreage planted in the Fifth District as last year, except that
put into tobacco and some truck crops, which may be increased. Farm products continue to bring good prices,
and signs point to increases in most lines in or before fall. Considerable cotton is still held by producers, but the
mills are fairly well supplied, and the demand is therefore quiet. The farmers do not appear worried at the
slack demand, and show no disposition to drive prices down by throwing their holdings upon a dull market.
TOBACCO.—Manufacturers report that foreign trade is quiet, due to unfavorable exchange rates, but
home consumption demands are brisk and furnish the factories with sufficient business to keep them running
profitably. Traffic difficulties, together with a shortage in essentials necessary in the manufacture of tobacco
products, have made general conditions in the industry more or less unsatisfactory. Indications point to an
increased acreage put into tobacco this year, and manufacturers evidently expect demands to keep up well,
since several of the large manufacturers are now building additions to their plants.
FERTILIZER.—The demand for fertilizer has been greater than usual, and some sections have found
difficulty in securing shipments in sufficient quantity to meet needs, but on the whole the manufacturers have
met the farmers’ demands well. The difficulties met by the manufacturers in securing raw material and in
delivering the finished product to the farmers, are chargeable mainly to car shortage.
COAL.—A large coal producer writes us as follows: “ We are experiencing now the worst car shortage in
the history of the industry, considering the time of year.” That sentence tells the story of conditions in the coal
fields. The producers cannot finance operations unless they can market the product from the mines, and since
the railroads can move only a part of normal production, mine owners are forced to operate on part time. This,
of course, necessitates higher prices to cover over-head expenses, and, still worse, prevents the miners from
working full time and drawing full pay. There seems little likelihood that unaided the railroads will be able to
better traffic conditions materially in the near future, and therefore little chance that coal prices will be any
lower for the coming months.
TEXTILES.—Textile mills continue prosperous and numerous large dividends are declared, either in cash
or additional stock. Mill engineers are busy installing new machinery and planning new construction. Specu­
lation in cotton mill stocks has been active and shares have sold readily at several times par value. Some
uneasiness has been reported on the part of the retailers, caused by a combination of unseasonable weather and
some tendency toward more careful buying on the part of the long suffering ultimate consumer. All textile
lines have been made nervous by recent tendencies in the silk market, and some authorities see in this the begin­
ning of readjustment in price levels. A prominent authority in dry goods was recently quoted in the news­
papers as saying, “ It is worthy of note that the first decline in prices has been on luxuries. It is a clear indi­
cation that people are coming to their senses and are going to buy materials that will give service and long




wear. Staple goods do not show any weakness in the primary or secondary markets. It will be some time before
there will be a weakness or a reduction of prices. I believe the process of stabilization has begun. I don't
believe the jobbers, retailers or customers are going to stand for artificial prices and factory values any longer.”
CLOTHING AND SHOES.—Advices received up to this writing show that neither clothing nor shoe
manufacturers expect any recession in prices for high grade goods in the immediate future, but rather expect
further advances. Both claim, however, that sightly and durable goods could be produced and put on the
retail market at reasonable prices if the public would buy them. They claim that there is little market for the
lower and medium grades of wool and leather, from which these medium priced products would be made, but
that goods made from these lower grades would give long wear and satisfactory service if a market for such
goods should develop. To what extent the above expressed views will be allowed by the recent reductions in
prices by retail stores throughout the country, can be determined only by subsequent reports.
HOUSING.—There has been no noticeable improvement in the housing situation, in spite of increased
building activity. The greater part of the new construction now under way is for business purposes instead of
for homes, and therefore the demand for the latter is steadily becoming greater and the shortage more acute.
The high prices asked for building materials, the high wages paid labor and the general inability to secure bind­
ing agreements with labor to finish a piece of work when it is once undertaken, are active factors in keeping
investors from erecting houses for rent or sale. The scarcity of rental property has naturally increased rents,
which fact in turn encourages speculation in houses for rent, each purchaser raising the rent again in order to
show a sufficient return to lead some other speculator to purchase the property from him at a higher figure.
Elsewhere in this report we publish a comparative table, showing building activities in twenty-three cities
in the District. These figures show an increase in total valuation of 84.9% for April, 1920, over the corre­
sponding month last year.
BUILDING MATERIALS .—Lumber dealers say that demands are quiet, and there are some indications
that accumulating stocks may bring slightly lower prices during the next three or four months. Dealers write
that most of the present building activity is concerned with business buildings, which use little lumber. On the
other hand, bricks, stone, cement, and steel for construction purposes are all in heavy demand, and manu­
facturers cannot fill orders. Glass* manufacturers report much trouble with embargoes, car shortage for both
shipment of raw materials and finished product, and labor's pay, but saL that they are keeping up with orders
y
fairly well. The demand for their products is brisk. Several large lumber dealers write that prices are too high
to the consumer, and the general opinion seems to be that if lower prices could be brought about gradually, the
lumber dealers would benefit about as much as the consumers, because of the increased building which would
be stimulated.
RETAIL TRADE.—The figures on retail trade, as reflected in reports received from representative depart­
ment stores in Baltimore, Richmond, and Washington, clearly show the hesitating attitude taken by the buying
public. Net sales increased during March 1920, 23.1% over sales during the corresponding month last year,
but sales for April, 1920, were only 2.1% greater than for April, 1919. Combined sales for the first three months
of 1920 increased 14.6% over sales during the same period last year, but totals for the first four months of
1920 are only 9.3% greater than for the corresponding four months last year. Stocks on hand at the close of
April, 1920, were 62.9% greater in value than on the same date last year, but there was a decrease of 1% in
stocks on hand April 30th over those on hand March 31st. Average value of stocks on hand at the close of each
month since Januar}^ 1, 1920, was 403.6% over net sales during the same period. At the close of March this
average was 408.2%.
Elsewhere in this report we publish a table giving these averages for Baltimore, Washington, and the
District as a whole. Data was not available for making all averages for Richmond without danger of making
the identification of individual stores possible, and therefore no separate figures for Richmond are given, but
the reporting stores are included in the District averages.




FIGURES ON RETAIL TRADE
As Indicated by Reports from Several Representative Department Stores in Each
City for the month of April, 1920.
(C ompiled
1. A.

by the

F ederal R eseve B ank

op

R ichmond)

Percentage of increase or decrease in net sales during April, 1920, over same month last year:
.
.. 11.4%
Baltimore................
Richmond..............
.........
...
................... 10.6%
Washington................................................................................ 9.2%
Average for District.................. ..............
........... 2.1%

B.

Percentage of increase or decrease in net sales from January 1st through April 30, 1920, over net
sales during same period last year:
Baltimore...................................................................
. . .20.1%
Richmond.........................................
..............................15.2%
Washington...............................................................
...
3%
Average for District............................................................. 9.3%

2. A.

increase.
increase.
decrease.
increase.

increase.
increase.
decrease.
increase.

Percentage of increase or decrease in stocks at close of April, 1920, over stocks at same date last
year:
Baltimore...................................................................................... 95.0% increase.
Richmond......................................................................................
Washington...................................................................................51.1% increase.
Average for District............................................................... 62.9% increase.

B.

Percentage of increase or decrease in stocks at close of April, 1920, over stocks at*'close of March,
1920.
Baltimore...................................................................................... 3.5% increase.
Richmond.......................... ...........................................................
Washington................................................................................ 5.8% decrease.
Average for District....................
............................ 1-0% decrease.

3.

Percentage of average stocks at close of each month since January 1st, to average monthly net
sales during same period:




Baltimore..................................................................................................... 408.2%
Richmond.....................................................................................................

Washington.................
Average for District

.392.0%
.403.6%

CLEARINGS
F or M

o n th of

A p r il

Increase or
Decrease

CITIES

No.

1920

,
,

6 087,079
393, 131.859
21 784,634
38, 366,156
18;036,245
3, 750,529
6 713,460
16 716,050
4 335,290
*7, 930,292
4, 434,572
44, 403,040
8,333,696
254, 400,585
74;765.860
5, 252,204

3
4
5

6

7
8
9
10

11
12

13
14
15
16

4,120,393
315,957,751
15,410,616
22,600,000
9,060,076
3,040,600
4,502,436
6,069,481
3,433,150

1,966,686
77,174,108
6,374,018
15,766,156
8,976,169
709,929
2,211,024
10,646,569
902,140

4,431,761
40,342,260
4,504,455
210,136,678
66,758,331
3,718,895

2,811
4,060,780
3,829,241
44,263,907
8,007,529
1,533,309

714,086,883 $

186,424,376

26.1

,
,
,

T otal.

1

41.2

900,511,259

Asheville, N. C........
Baltimore, M d.........
Charleston, S. C _
_
Charlotte, N. C .......
Columbia, S. C ........
Frederick, M d.........
Greensboro, N. C . ..
Greenville, S. C ......
Hagerstown, M d___
Huntington, W. Va.
Newport News, V a ..
Norfolk, V a............ .
Raleigh, N. C ..........
Richmond, V a.........
Washington, D. C ...
Wilmington, N. C ...

1

2

1919

Percent of
Increase or No.
Decrease

47.7
24.4
41.5
69.8
99.
23.3
49.1
175.4
26.3

2

3
4
5
6
7

8
9
10

.06

11

12
13
14
15
16

10.1

85.
21.1
12 .

Not counted in totals.

BUILDING OPERATIONS FOR THE MONTHS OF APRIL, 1919 AND 1920.
Permits I ssued
N ew C onstruction
New

C IT IE S
o

1920

1 Asheville, N. C ..........
2

3
4
5
6
7
8
9
10

11

12
13
14
15
16
17
18
19
20

21
22

23

Baltimore, M d...........
Charleston, S. C .......
Charleston, W. Va....
Charlotte, N. C .........
Columbia, S. C..........
Cumberland, M d......
Durham, N. C ...........
Frederick, M d...........
Greenville, S. C ........
Greensboro, N. C ......
High Point, N. C......
Huntington, W. Va...
Lynchburg, Va..........
Norfolk, Va................
Parkersburg, W. V a ..
Richmond, Va...........
Roanoke, Va..............
Spartanburg, S. C---Staunton, Va.............
Washington, D. C---Wilmington, N. C___
Winston-Salem, N. C.
T

-

o t a l ............................

41
646
19
61
16
23
23
8
10
23
5
39
123
6
141
72
85
27
7
197

11

53
1,6

A lterations

Increase or Per Cent
Decrease
of In­
Total ^Valu­ crease or
ation
Decrease

Repairs

1919

1920

1919

33
78
351 1,355
9
23
12
56
17
26
15
81
17
29
3
7

75
872
13

24
6
15

2
22
6

8
107

21
39
5
3
110

165

1

14
18

64

119
117
27

16

2

241
8
34

8
18

1

490

2

151

427
3
35

1,104 2,415 1,984

1920

1919

239.000 I 76,045
4, 315,560 1,195,037
37,960
20,600
356,754
96,500
91,355
86,080
58,950
94.000
34,353
78,700
506,490
23,300
12,980
126,650
89,550
39,500
67,400
86,195
12,855
323,090
13,300
300
542,543
728,275
20.000
776,816
625,936
168,492
67,775
36,595
14,200
1,200
1,608,065 1,857,376
111.000
22,500
269,225
169,215

1920

1919

32,510
806,160
12,150
8,275
37,625
49,000
18,655
4,685
4,400
29,975
11,025

13,013
313,920
18,340
19,827
7,590
16,399
7,290
7,300

4,350
71,570
8,000
189,048
10,505
428,119
1,150
58,190

1,899,650 $5,202,067 $1,785,392

25.380
16,475
3,100
214,667
6,325
28,979
30.000
54*662
38.380
5,465
1,000
254,855
11.000

24,145

182,452
204.9
239.4 ,
3,612,763
28.7
11,170
213.8
248,702
37.7
35,310
67,651
89.8
55,712
133.8
480,575 1,570.5
17,380
36.3
41,695
66 . 033,350440.2
70,240
50.5
108,423
166.4
11,025
18.9143,1416.72 000
41.9
285,266
339.0
130,112
86.1
36,220
545.5
12,000
3.676,047234.8
78,650
69.3
134,055

, -

1,118,112 $ 5,364,863

o
*
5

1
2

3
4
5
6
7

8

9

10
11
12
13
14
15
16
17
18
19
20

21
22
23

84.9

Decrease.

CONDITION OF EIGHTY-TWO SELECTED MEMBER BANKS
FIFTH FEDERAL RESERVE DISTRICT
(In Thousands of Dollars)

Total United States Securities owned...........................................
Loans secured by U. S. War Obligations......................................
Loans secured by stocks and bonds other than U. S. Securities.
All other loans and investments.....................................................
Reserve balance with Federal Reserve Bank.............................. .
Net demand deposits on which reserve is computed.......
Time deposits......................................................................... .......
Eighty-three banks.




__________________
April 9
May 7,
1920
1920
t 88,443
28,620
109,992
358,327
35,934
350,727
105,055

I 88,141
30,707
108,852
353,190
36,425
354,795
100,850

May 9,
1919
158,271
36,752
379,839*
‘ 34,747
326,047
79,311

STATEMENT OF CONDITION FEDERAL RESERVE BANK OF RICHMOND
As of April 16, 1920
RESOURCES
RESERVES:
Gold Coin and Certificates....................................
Gold Settlement Fund—Federal Reserve Board.
Gold with foreign agencies.....................................

2,385,025.00
15,641,599.81
5,526,225.38

Total gold held by bank....................................
Gold with Federal Reserve Agent..........................
Gold Redemption Fund—Federal Reserve Notes.

23,552,859.19
42,732,105.00
5,339,992.49

Total gold reserves............................................
Legel tender notes, silver, etc.................................

71,624,947.68
541,849.75

TOTAL RESERVES....................................
UNCOLLECTED ITEMS:
Currency of other banks and unassorted currency.
Transit items........................... ...................................
Checks and other cash items..................................
Exchanges for Clearing House..................................
TOTAL UNCOLLECTED ITEM S............................
EARNING ASSETS:
Bills discounted—Secured by Government War Obligations.
Bills discounted—All others......................................................
Bills purchased in open market......... ..................................... .

$

72,166,797.43

$

67,705,979.02

$

119,678,352.93

2,726,533.00
59,833,700.54
47,344.24
5,098,401.24

61,747,167.16
33,609,447.37
10,827,138.40
106,183,752.93
1,234,600.00
12,260,000.00

Total bills on hand.....................................
U. S. Government Bonds and Victory Notes.
U. S. Certificates of Indebtedness...................
TOTAL EARNING ASSETS....................................
MISCELLANEOUS ASSETS:
Interest accrued on U. S. Certificates....................................
Advance to U. S. Government for War Loan expenses........
Bank premises............................................................................
Five Per Cent. Fund against Federal Reserve Bank Notes- -Our own.
Overdrafts—Members
.................... .............................
All other resources............. ....................................................

74,030.64
139,314.14
640,981.13
451,300.00
218,404.08
22,226.54

TOTAL MISCELLANEOUS ASSETS.
TOTAL RESOURCES....................

1,546,256.53
LIABILITIES

CAPITAL AND PROFITS:
Capital paid in ........ .
Surplus...........................
Unapportioned profits..
TOTAL CAPIT
\T> PROFITS.
NOTE CIRCULA1
Federal Reserve Notes in actual circulation—Our own..........
Eederal Reserve Bank Notes in actual circulation—Our own.
TOTAL NOTES IN ACTUAL CIRCULATION.......
DEPOSITS:
U. S. Treasurer.......................................................................... ...
Member Banks’ Reserve Accounts.............................................
Foreign governments...................................................................
Cashiers’ Checks...........................................................................
Deferred availability—Uncollected funds.................................

4,723,250.00
5,820,462.63
1,572,952.78
$
125,630,720.00
8,431,662.00
134,062,382.00
2,466,746.15
58,614,679.67
3,542,408.75
74,491.86
49,887,561.46

TOTAL GROSS DEPOSITS.
MISCELLANEOUS LIABILITIES:
Reserve for taxes other than Franchise ta x ..
Reserve for depreciation on U. S. Securities.
Unearned discount..........................................
All other liabilities...........................................

$

114,585,887.89

$

261,097,385 91

$

4,847,240.00
19,270,000.00

12,100.30
4,580.00
314,397.29
1,373.02

TOTAL MISCELLANEOUS LIABILITIES.
TOTAL L IAB ILITIES.............................
MEMO:
Due U. S. Treasurer by Depositary banks.............
Contingent liability on bills rediscounted or sold.




12,116,665.41

332,450.61


Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102