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MONTHLY

REVIEW

o f Financial and Business Conditions

F ifth
Federal

Re s e r v e
D is tr ic t

x " ' N r ......*4

Federal Reserve Bank, Richmond, Va.

April 30, 1941

Summary of March Business Conditions
H E wide influence o f the defense program is stead­
ily expanding throughout the Fifth Federal Reserve
district as increased employment and larger payrolls en­
able workers to buy more consumer goods. A ll lines o f
trade and industry continued operations at approximate
capacity levels or increased further in March, and all in­
dicators were materially above those o f March last year.
Debits to individual accounts in the banks of 25 Fifth
district cities, reflecting payments by check, rose 25 per
cent above debits in March 1940, every reporting city
registering a gain this year. Reporting member banks
increased loans to industry and trade during the year, and
the greater need for money with which to meet current
payrolls and provide additional pocket cash is indicated
by a marked rise in Federal Reserve notes in actual circu­
lation. The number o f business insolvencies last month
decreased 20 per cent from the number of bankruptcies in
March last year.

T

cent, and sales o f new passenger automobiles were 41
per cent larger in March 1941 than in March 1940, auto­
mobile sales being stimulated not only by generally in­
creased purchasing power but also by anticipation o f high­
er retail prices as a result o f rising taxes and reductions in
output by automobile factories as defense work expands.
Construction work continues to increase in the district.
Building permits issued in 30 cities last month exceeded
March 1940 permts by 5 per cent, a relatively small gain,
but contracts actually awarded in the district for both
urban and rural work rose 81 per cent above last year’s
figures.
Industries have probably never been busier in the
Fifth district than they were in March. Cotton textile
mills used 26 per cent more cotton than in the correspond­
ing month last year, rayon yarn mills shipped 18 per cent
more yarn to domestic consumers, tobacco manufacturing
exceeded March 1940 output in every branch o f the in­
dustry, and coal mines produced 37 per cent more coal
than a year ago. In April, however, Fifth district coal
mines were closed from the first o f the month through the
date o f this survey, April 21, while operators and miners
negotiated renewal o f labor contracts. The coal mine
shut-down is the only serious labor and management dis­
agreement to this time in the Fifth district.

Department store sales in 79 Fifth district stores in
March 1941 were 10 per cent larger than sales in March
1940, an impressive increase in view o f the fact that
Easter trade occurred in March 1940 but much o f it fell
in April this year. Furniture sales rose 32 per cent last
month over sales a year ago, wholesale trade rose 24 per

BUSINESS STATISTICS— FIFTH FEDERAL RESERVE DISTRICT

March 1941
Debits to individual accounts (25 cities)....
Sales, 79 department stores, 5th district....
Sales, 41 furniture stores, 5th district.........
Sales, 188 wholesale firms, 5th district.......
Registrations, new autos, 5th district.........

$1,674,663,000
$ 13,995,665
1,137,839
$
$ 12,656,000
30,742

Number of business failures, 5th district....
Liabilities in failures, 5th district...............
Value of building permits, 30 cities...... ......
Value o f contracts awarded, 5th district..
Cotton consumption, 5th district (Bales)..

$
$
$

Cotton price, cents per lb., end of month....
Print cloths, 39 in., 80x80s, end of month....
Rayon yarn shipments, U. S. (Pounds).....
Rayon yarn stocks, U. S. (Pounds).............
Bituminous coal mined, U. S. (T on s).........




35
547,000
12,172,328
57,017,000
385,352
10.89
9.25
35,200,000
9,700,000
48,250,000

February 1941

March 1940

$1,440,567,000
$ 10,550,615
1,251,675
$
$ 11,270,000
23,539

$1,342,709,000
$ 12,702,648
865,216
$
$ 10,247,000
21,989

$
$
$

47
901,000
8,250,505
35,023,000
356,419
10.25
7.875
31,600,000
10,000,000
41,695,000

$
$
$

% Change
Year
Month
+
+
+
+
+

25
10
32
24
41

44
500,000
11,571,518
31,542,000
305,494

4+
—
+
+
—
—
+
+
+

16
33
9
12
31
26
39
48
63
8

— 20
+ 9
4* 5
+ 81
+ 26

10.50
6.50
29,800,000
10,400,000
35,244,000

+ 6
+ 17
■+ 11
— 3
+ 16

4- 4
4- 42
+ 18
— 7
4- 37

MONTHLY REVIEW

2

DEBITS TO IN DIVIDUAL ACCOUNTS

RESERVE BANK STATE M E N T

Discounts for member banks rose between the middle of
March and the middle o f April, and industrial advances,
after declining slowly but steadily for nearly a year, in­
creased also. Circulation of Federal Reserve notes, re­
flecting the greater need for currency for increased pay­
rolls and a higher level of general business activity, con­
tinued to rise. The Bank’s holdings of Government se­
curities under System allocation were also moderately in­
creased between March 15 and April 15, and cash reserves
advanced substantially.

Discounts held ..............................................
Foreign loans on gold ...............................
Industrial advances ....................................
Government securities ..............................
Total earning assets .............................
Circulation of Fed. Res. n o te s .................
Members’ reserve deposits .......................
Cash reserves ................................................
Reserve ratio ..............................................

000 omitted
April 15
March 15
April 15
1941
1941
1940
$
210
$
43
$
175
0
0
43
848
766
915
121,486______119,976______125,871
122,544
120,785
127,004
298,853
291,234
218,615
400,802
394,914
286,730
650,872
628,578
439,752
85.03
84.45
78.16

M EM BER BANK STA TE M E N T

Forty-one regularly reporting member banks in 12
Fifth district cities reported increased loans, cash in vaults,
and time deposits between March 12 and April 9, 1941,
but declines occurred in investments in securities, reserve
balances, and demand deposits. The rise in loans was
almost entirely in advances to trade and industry. Be­
tween April 10, 1940, and April 9, 1941, loans to business
advanced by $27,300,000, or 23 per cent, while all other
loans increased only $9,645,000, or 6 per cent. The rise
in business loans reflects in large part assistance extended
to the defense program.
SELECTED ITEMS—41 REPORTING BANKS
Fifth Disrict
ITEMS
Loans to business and agriculture
All other loans . ................................
Investm nts in securities ...............
Reserve bal with F. R. bank . . . .
Cash in vaults . . ...............................
Drmand deposits.......... ....................
T'me derosifs ....................................
Money borrowed ................. ..............

000 omitted
April 9
March 12
1941
1941
$144,000
$146,500
159,392
159,188
428,461
471,875
270,921
273,152
27,444
26,649
662,843
654,971
207,504
206,030
0
0

....

of Change
Month Year

%

$ 342,396

$ 287,863

$ 287,345

+ 19

+ 19

481,724
8,694
11,074

416,425
7,704
10,085

391,008
8,213
9,326

+ 16
+ 13
+ 10

+ 23
+ 6
+ 19

15,798
99,621
32,350
24,986
57,714
15,455
48,231

14,314
89,650
25,293
23,353
46,538
12,863
38,535

12,500
69,942
26,575
21,145
44,158
11,325
43,909

+
+
+
+
+
+
+

10
11
28
7
24
20
25

+
+
+
+
+
+
+

26
42
22
18
31
36
10

Sou'th Carolina
Charleston ...........
Columbia .............
Greenville ...........
Spartanburg . . . .

26,077
41,821
24,834
17,852

22,601
34,112
22,247
18,316

20,651
29,232
20,075
10,921

+ 15
+ 23
+ 12
— 3

+
+
+
+

26
43
24
63

Virginia
Danville ...............
Lynchburg ...........
Newport News . .
Norfolk .................
Portsmouth...........
Richmond .............
Roanoke ...............

8,938
16,759
16,556
72,632
6,494
184,219
33,511

8,153
14,277
13,245
64,390
5,402
157,765
29,511

8,019
15,844
11,519
51,227
4,479
141,849
28,527

+ 10
+ 17
+ 25
+13
+ 20
+ 17
+ 14

+
+
+
+
+
+
+

11
6
4
42
45
3Q
17

West Virginia
Charleston ...........
Huntington .........
Parkersburg . . . .

56,502
19,559
10,866

51,584
16,843
9,498

47,474
17,102
10,344

+ 10
+ 16
+ 14

+ 19
+ 14
+ 5

Disrict Totals . - -

$1,674,663

$1,440,567

$1,342,709

+ 16

+ 25

Maryland
Baltimore .............
Cumberland .........
Hagerstown .........
North Carolina
Asheville ...............
Charlotte...............
Greensboro ...........

C O M M E R C IA L FAILU RES

Dun & Bradstreet reports commercial failures in the
Fifth district and the United States for several recent
periods as follow s:
PERIODS
March 1941 ...................
February 1941 ...............
March 1940 ...............
3 months, 1941 .............
3 months, 1940 .............

April 10
1940
$119,200
149,747
412,303
190,291
22,146
543,935
201,144
0

M U T U A L SAVIN G S BANK DEPOSITS

Deposits in 10 mutual savings banks in Baltimore set
a new record on March 31, 1941, totaling $225,009,656,
in comparison with $224,323,164 in deposits on February
28, 1941, and $223,163,689 on March 31, 1940.
DEBITS TO IN D IV ID U A L A C CO U N TS

Checks cashed against depositors’ accounts in the banks
in 25 cities in March showed a seasonal rise over Febru­
ary figures, and also rose 25 per cent above March 1940
figures. The high debits total reflects the large volume of
business resulting either directly or indirectly from the
defense program.




Dist. of Col.
Washington

000 omitted
Feb.
Mar.
1941
1940

Mar.
1941

Wilmington .........
Winston-Salem . .

RESERVE BAN K STATEMENT ITEMS
Fifth Disrict
ITEMS

CITIES

Number of Failures
District U. S.
35

148

Total Liabilities
District
U. S.

1,211
1,129
1,197

$ 547,000
901,000
500,000

$13,444,000
13,483,000
11,681,000

3,464
3,476

1,819,000
1,663,000

38,815,000
40,432,000

EM PLOYM ENT

Construction work at army camps has declined sub­
stantially or been practically completed during the past
month, and in bituminous coal fields miners have been
voluntarily idle since April 1, but employment has in­
creased further in every other branch o f industry and
trade since March 1. Labor is so well employed in con­
struction and industry that farmers report a scarcity o f
agricultural workers, although the farming season is just
beginning. Skilled mechanics are the workers in great­
est demand, and there are insufficient men of this class to
meet industry’s need, but the problem can probably be
solved by shifts o f workers from non-defense industries
to those doing more important work, or by transfer of
workers from production o f consumer goods to defense
products in the same plant, as in the automobile industry.
The following figures, compiled for the most part by the
Bureau of Labor Statistics, show the trends o f employ­
ment and payrolls in the Fifth district from February to
M arch:

3

MONTHLY REVIEW
Percentage change from
Feb. 1941 to Mar. 1941
in number
in amount
on payroll
of payroll

STATES
Maryland ..............................................
Dist. of Colum bia.............................
Virginia ................................................
West Virginia ....................................
North Carolina ...........................
South Carolina ................................ ..
District A v e r a g e ...........................

...........
...........
...........
...........
...........
...........
.....

+ 2 .0
+ 2 .0
+ 1 .3
+ 1 .9
+ 1 .1
+ 1 -3
+ 1.5

+
+
f+

3.3
1.7
4,1
4.4
1.6
3.6
3.4

A U T O M O B IL E R E G ISTRA TIO N S

Registrations o f new passenger automobiles in the Fifth
district, representing sales of new cars at retail, continue
very high. Owners of old cars have reached the conclusion
that automobiles prices will advance materially as soon as
new tax legislation can be passed, and they are trading in
their used cars for new ones or for better and later model
used ones. In March, sales of new cars set all time
records for that month in Maryland, the District of Colum­
bia, Virginia, North Carolina and South Carolina, and
dealers state that the demand for new cars jumped higher
in April as a result o f the automobile industry’s announce­
ment o f restrictions to be put on 1942 production and the
Treasury’s notice of intention to raise three and a half
billions in additional taxes. The increased demand for
cars, while chiefly in the new car field, has been felt in
sales o f late model used cars also, but dealers’ stocks o f
used cars have increased substantially in the past two or
three months. Many of the cars being traded in on new
ones are comparatively recent models with low mileage on
them, and they will sell easily, especially if and when new
car output is restricted.
Registration figures in Fifth district states for March,
as reported by R. L. Polk & Co., of Detroit, are as fol­
lows :

to $132,907,000, the highest total for any first quarter
since records began in 1921 and 60 per cent above $83,163,000 in the first quarter o f 1940.
Figures by states for February 1941, which were not
available when the March 31 R eview went to press, were
reported by F. W . Dodge Corporation as fo llo w s:
CONSTRUCTION CONTRACTS AW ARDED
STATES
Maryland .............................
Dist. of Col.......... ..................
Virginia ......................... ..
West Virginia .....................
North Carolina ...................
South C arolina.....................
District ................................

Feb. 1941Feb. 1940
% Change
$ 5,687,000
$10,234,000
— 44
5,880,000
6,839,000
— 14
10,693,000
4,728,000
+126
3,746,000
2,149,000
+ 74
6,360,000
3,987,000
+ 60
2,657,000
1,668,000
+ 59
$35,023,000

$29,605,000

+

18

BITU M IN OU S C O A L M IN IN G

Practically all bituminous coal mines in the United
States have been closed since April 1, and production has
been negligible. Reserve stocks were accumulated in an­
ticipation o f the shut-down, but industry and the railroads
are using coal at a high rate and shortages o f fuel are now,
on April 21, beginning to develop. Production o f soft
coal in the United States in March totaled 48,250,000 net
tons, compared with 41,695,000 tons in February 1941 and
35,244,000 tons in March 1940. The high figure last
month was due in part to stocking o f coal. Total produc­
tion this calendar year to April 5 of 138,719,000 tons ex­
ceeded production o f 126,450,000 tons to the same date
in 1940 by 10 per cent. Shipments o f coal through Hamp­
ton Roads ports between January 1 and April 5 totaled
6,635,227 tons this year and 6,925,217 tons last year. In
the Fifth district, coal mined in March 1941, February
1941 and March 1940, was as fo llo w s:
SOFT COAL PRODUCTION IN TONS

REGISTRATION OF N E W PASSENGER CARS— NUMBEIR
STATES
Maryland . . . . . .
Dist. of Col. . . .
Virginia .............
West Virginia . .
No. Carolina . . .
So. Carolina . . .
Fifth

District.

Mar.
1941
7,052
3,896
6,357
2,740
6,727
3,970

Mar.
1940
5,337
3,087
3,862
2,460
4,415
2,828

%
Change
+ 32
+ 26
+ 65
+ 11
+ 52
+ 40

30,742

21,989

+ 40

3 Months 3 Months
1941
1940
15,421
11,669
8,311
6,434
18,694
10,838
7,274
6,329
17,586
12,355
10,357
7,605
77,643

55,230

%

Change
+ 32
+ 29
+ 72
+ 15
+ 42
+ 36
+ 41

C O N STRU C TIO N

Building permits issued in March 1941 in 30 Fifth dis­
trict cities totaled $12,172,328, a seasonal increase of 48
per cent over permits totaling $8,250,505 issued in Febru­
ary this year and 5 per cent above $11,571,518 in permits
issued in March 1940. Permits in the first quarter o f 1941
totaling $32,646,746 were 38 per cent greater than $23,605,168 in the first quarter of 1940. Washington led in
March 1941 permits with $5,296,450, Baltimore was sec­
ond with $2,124,600, Raleigh third with $1,113,825, Rich­
mond fourth with $746,509, and Charlotte fifth with
$343,564.
Contracts actually awarded in March for construction
work in the Fifth district totaled $57,017,000, an increase
o f 63 per cent over $35,023,000 in February and a gain of
81 per cent above $31,542,000 in March last year. Total
awards in the district in the first quarter of 1941 amounted




REGIONS
West Virginia .......................
Virginia.......................................
Maryland ..................................
5th District .....................
United States .................
% in District ............ . .

Mar. 1941
12,945,000
1,594,000
174,000
14,713,000
48,250,000
30%

Feb. 1941
10,835,000
1,343,000
153,000
12,331,000
41,695,000
30/%

Mar. 1940
9,720,000
1,156,000
137,000
11,013,000
35,244,000
31%

C O TTO N TEXTILES

Buying o f all kinds of cotton gray goods was heavy 111
March, according to the monthly survey by the Journal
o f Commerce. Print cloths sold in large amounts and a
substantial business was written on sheetings, drills, osnaburgs and combed goods. Price advances were more pro­
nounced than in any other month since the buying move­
ment got under way last September, and averaged approxi­
mately 1 cent per yard on most constructions. Mills en­
tered the second quarter with the largest peacetime
backlogs they ever possessed, and maintenance o f the
present high rate o f operations is assured for at least six
months. Cotton consumption in Fifth district mills in
March was higher than in either the shorter month of
February 1941 or March 1940, but declined slightly from
the January 1941 record.
Consumption o f cotton in
Fifth district states, as reported by the Census Bureau,
was as follows in March and February this year and
March last yea r:

4

MONTHLY REVIEW
COTTON CONSUMPTION— FIFTH DISTRICT
In bales

MONTHS
March 1941 ............ ............
February 1941 .....................
March 1940 .........................
3 Months, 1941 ...................
3 Months, 1940 ...................

No. Carolina So. Carolina Virginia
210,198
158,442
16,712
194,637
146,331
15,451
163,705
129,351
12,438
616,967
466,684
49,179
528,363
403,324
40,013

TOBACCO MANUFACTURING
District
385,352
356,419
305,494
1,132,830
971,700

THE RAYON MARKET

Rayon Organon reports shipments o f 35,200,000 pounds
o f rayon filament yarn to domestic consumers in March,
compared with 31,600,000 pounds shipped in February
and 29,800,000 pounds in March last year. One o f the
medium-size viscose rayon yarn plants was closed by a
strike on March 22, and had not reopened at the end o f
the month. Shipments exceeded production o f yarn last
month, and reserve stocks consequently declined from
10.000.000 pounds on February 28 to 9,700,000 pounds on
March 31. On March 31 last year reserve stocks totaled
10,400,000 pounds. The National Rayon W eavers A s­
sociation and the National Federation o f Textiles recently
announced a new inventory o f rayon filament yarn held
by rayon broad goods weavers in mill warehouses or un­
opened cases, but exclusive of stocks in process or in
transit. On February 28, 1941, American mills thus held
28.000.000 pounds of yarn, against 28,600,000 pounds
at the end o f 1940 and 24,000,000 pounds held on Febru­
ary 29, 1940.
COTTON STATISTICS

Spot cotton prices on 10 Southern markets rose during
March and early April from an average o f 10.68 cents
per pound for middling short staple on March 14 to 11.22
cents on April 14, the high point for the current season
to date. The price eased off after the 14th to 11.08 cents
on April 18, the latest date for which data are available.
Price advances since the first o f the year have been suffi­
cient to encourage repossessions o f loan cotton, and
through April 15 approximately 1,193,000 bales o f the
1940 loan stocks were withdrawn. Total loan stocks, in­
cluding cotton owned by the Government, are now about
10.000.000 bales.

Production o f tobacco products in March not only
showed a seasonal rise from February figures, but ex­
ceeded March 1940 production in every branch o f the
industry. Percentage increases for March 1941 output
over March 1940 were 19 per cent for cigarettes, 8 per
cent for cigars, 3 per cent for chewing and smoking to­
bacco, and 2 per cent for snuff. Production figures re­
leased by the Bureau o f Internal Revenue are as fo llo w s:
Mar. 1941

1941
385,382

305,494

United States:
Cotton consumed ...................
Cotton on hand March 31 in

Sales
+ 5 ( + 9)
+ 11( + 13)
+ 12( + 15)
+ 5 ( + 9)
+ 10 ( + 14)

Richmond (5) ...............
Baltimore (10) .................
Washington (7) ...............
Other Cities (12) ...........
Fifth District (79)♦ . . . .
Same stores by states,
including stores report­
ing sales only:
Maryland (13) .................
Virginia (16) ...................
West Virginia (15) .........
North Carolina (16) . . .
South Carolina (12) . . .

Stocks
+ 9
+ 7
+ 9

+6
+8

Orders Receivables
+ 78
+7
+ 73
+ 9
+ 59
+ 9

+66
+66

+6
+8

+ 1 1 (+ 1 3 )
+ 1 1 (+ 1 5 )
+ 4 ( + 7)

+ 7 + H)

+

3( + l l )

♦Includes stores reporting sales only.
Note: Second figure in parentheses under Sales compares combined
in 3 months of 1941 with sales in first 3 months last year.
RETAIL FURNITURE SALES
% Changes in Sales, March and 3 Months 1941

STATES
Maryland, 9 stores ........................
Virginia, 13 stores.......................
North Carolina, 5 stores.............
South Carolina, 7 stores...............
District, 41 stores................... ..

Compared with
Mar. 1940
+ 24
+ 46
+ 31
+ 13
+ 40

Individual Cities:
Baltimore, 9 stores.........................

Compared with
3 Months 1940
h24
-36
-27
-20
-32
+ 29

+ 24
+ 13
+ 46

Washington, 7 stores.....................

+ 24
+ 7
+ 36

W HO LESALE TRADE, 188 FIRMS

2,783,574

2,538,175

5,183,855

4,535,493

627,194

6,075,096

5,330,901

Consuming establishments . . 1,911,238 1,596,334
Storage & compresses ........... 13,243,573 11,409,520
Exports of cotton ..........................
97,292
433,842
Spindles active, U. S..................... 22,795,742 22,553,360

829,992

5,350,353




854,179

24,343,900
13,020,617,490
397,490,431
3,205,843

Percentage increase or decrease in sales, stocks,
outstanding orders and outstanding receivables in
March 1941 in comparison with March 1940 figures:

Fifth district states:
Cotton consumed .

Mar. 1940

DEPARTMENT STORE TRADE

Mar.
Aug. 1 to Mar. 31
1940
This Year Last Year

Cotton growing states:
722,584
540,516
Cotton consumed ...............
Cotton on hand March 31 in
Consuming establishments . .
1,555,064 1,317,056
Storage & compresses ........... 12,888,620 11,337,532

22,150,840
14,464,626,900
385,348,833
3,051,492

RETAIL AND WHOLESALE TRADE

COTTON CONSUMPTION AND ON HAND— BALES

Mar.

Feb. 1941

24,993,372
15,528,629,200
430,326,200
3,260,069

Smoking & chewing
tobacco, pounds ...............
Cigarettes, number .................
Cigars, number .......................
Snuff, pounds ............................

LIN E
Auto supplies (8) ...........
Shoes (4) ..........................
Drugs & sundries (10) .
Dry goods (8) .................
Electrical goods (10) . . .
Groceries (63) .................
Hardware (15) ..............
Industrial supplies (8) .
Paper & products (8)
Tobacco & products (8 ).
Miscellaneous (46) .........
District Average (188)

Net Sales
March 1941
compared with
Mar.
Feb.
1940
1941
+ 13
+21
+ 13
+ 13
+ 58
+ 10
+ 1'7
+ 76
+ 33
+ 16
+ 36
+24

Source: Bureau of the Census.

(Compiled April 21, 1941)

b 1
-11
- 6
r 14
- 5
-15
-10
-38
bl3
-11
+ 15
+ 12

Stocks
Ratio Mar.
Mar. 31,1941
collections
compared with
to accounts
Mar. 31
Feb. 28 outstanding
1940
1941
Mar. 1
+ 14
— 12

0
“ 10

—‘i

+ *2
+ 14
+ &
+ 3
— 4
— 1
+ 9
— 0

+ 32
+15

+ 9
+ 18
— 3
+ 8
+ 22
+ 9

+

1

64
48
87
44
72
96
49
101
77
80
61
67

MONTHLY REVIEW, April 30, 1941

FEDERAL RESERVE BANK OF RICHMOND

SUMMARY OF NATIONAL BUSINESS CONDITIONS
(Compiled by the Board of Governors of the Federal Reserve System)
IN D USTR IA L

PRODUCTION

Federal Reserve index of physical volume of
production, adjusted for seasonal variation, 19351939 average—100. By months, January 1935 to
March 1941.

DEPARTMENT STORE SALES AND STOCKS

Federal Reserve indexes of value of sales and
stocks, adjusted for seasonal variation, 1923-25
average=100. By months, January 1935 to March
1941.

WHOLESALE PRICES

Bureau of Labor Statistics’ indexes, 1926=100.
“ Other” includes commodities other than farm
products and foods. By weeks, January 5, 1935,
to April 12, 1941.

MEMBER BANKS IN 101 LEADING CITIES

Wednesday figures, January 2, 1935, to April
9, 1941. Commercial loans, which include indus­
trial and agricultural loans, represent prior to
May 19, 1937, so-called “ Other loans” as then
reported.




Industrial activity increased fu rth er in M arch bu t declined som ew hat in
the first h alf o f A pril ow in g to tem porary redu ction s in ou tpu t o f bitum inous
coal and autom obiles. W h olesale prices o f m any com m odities advanced con ­
siderably and the G overnm ent took steps to lim it price advances o f som e
additional industrial materials.
PR O D U C T IO N
Volum e o f industrial output continued to increase in M arch and the
B o a r d s seasonally adjusted index rose fro m 141 to 143 p er cen t o f the 1935-39
average. A ctiv ity increased fu rth er in m ost durable g ood s industries, particu­
larly in those producin g m achinery, a ircra ft, ships, and arm am ent.
Steel
production increased to about 100 per cent o f rated capacity.
A u tom obile production, w hich usually increases considerably in M arch,
showed little change fro m the high rate reached in F ebru ary. In the first h alf
o f A pril output was reduced considerably ow in g to a shutdow n at plants o f the
Ford M otor Com pany during an industrial dispute w hich w as settled abou t the
middle o f the month. Retail sales o f new and used cars advanced to new peak
levels in M arch and dealer's stocks at the begin ning o f A p ril am ounted to
about a m on th ’ s supply at the current rate o f sales. O utput o f lum ber, w hich
had been sustained at unusually high levels during the w in ter m onths, rose
less than seasonally.
A ctiv ity in the textile and shoe industries increased fu rth er in M arch.
C otton consum ption rose to a record level o f 854,000 bales and th ere w as also
an increase in rayon deliveries. A t w ool textile mills activity w as sustained
at the peak rate reached in Febru ary, n ot show ing the usual large seasonal
decline, and in the chem ical and ru b ber industries fu rth er advances w ere
reported.
Bitum inous coal p rodu ction rose considerably, w hile ou tpu t o f cru de
petroleum was m aintained in M arch at abou t the rate that had prevailed in
the fo u r precedin g months. In the first h a lf o f A p ril coal prod u ction declined
sharply, h ow ever, as m ost m ines w ere closed pen din g conclu sion o f con tra ct
n egotiations betw een m ine operators and the m iners’ union.
P rodu ction o f
n on ferrou s metals continued in large volum e in M arch and deliveries o f refined
copper show ed a sharp rise as dom estic p rodu ction w as supplem ented b y sup­
plies received fro m South A m erica.
C onstruction con tra ct aw ards rose sharply in M arch and w ere larger than
in any m onth since the m iddle o f 1930, a ccord in g to the F. W . D odge Cor­
poration data. The rise was chiefly in aw ards f o r publicly-financed w ork, w hich
had been reduced considerably in January and F ebru ary, and in private n on residential p rojects, particularly fa c to r y construction .
A w ards f o r private
residential building, w hich had been unusually large during the w in ter months,
show ed less than the custom ary seasonal rise in M arch.
D IS T R IB U T IO N
In M arch distribution o f com m odities to consum ers w as sustained at the
high level reached in February.
Sales at m ail-order houses and departm ent
stores increased seasonally and v ariety store sales show ed m ore than the usual
seasonal rise.
F reigh t-car loadings increased b y about the usual seasonal am ount. L oad­
ings o f coal and grain rose considerably, w hile shipm ents o f m iscellaneous
freigh t, w hich in previous m onths had risen steadily, on a seasonally adju sted
basis, show ed a smaller increase than is usual at this tim e o f year.
CO M M O D ITY P R IC E S
P rices o f basic com m odities continued to advance sharply fr o m the middle
o f M arch to the middle o f A pril. T here w ere substantial increases in prices
o f dom estic foodstu ffs and fu rth er advances in burlap, cotton , rubber, and lead.
Increases w ere also reported in w holesale prices o f a num ber o f m anu factu red
products and the general index o f the Bureau o f L ab or Statistics rose tw o
points to 83 per cent o f the 1926 average.
In form al action was taken by the G overnm ent to discou rage p rice increases
o f som e additional industrial m aterials and m axim um price schedules w ere
established f o r steel, bitum inous coal, secon dary and scrap alum inum and zinc,
and iron and steel scrap. Sharp redu ction s in prices o f som e kinds o f n on ferrou s metal scrap resulted. Announcem ent o f an expanded Federal purchase
program f o r hog, dairy, and pou ltry products w as fo llo w e d b y price increases
fo r these and related products.
B A N K C R E D IT
T ota l loans and investm ents at rep ortin g m em ber banks in 101 cities
increased during M arch and the first tw o w eeks o f A pril.
C om m ercial loans
continued to rise substantially, and h oldings o f U nited States G overnm ent
securities increased fu rther, reflectin g purchases o f new T reasu ry offerings.
U N ITED S T A T E S G O V E R N M E N T SE C U R IT Y P R IC E S
Prices o f United States G overnm ent securities declined irregu larly fr o m
M arch 15 to A pril 9 but subsequently rose slightly. The 1960-65 bonds showed
a net loss o f about % o f 1 poin t on A pril 15, fo llo w in g a rise o f ab ou t 3 %
poin ts.in the previous month. The yield on this issue on A p ril 15 w as 2.14 per
cent, com pared with 2.03 per cent at the all-tim e peak in prices on D ecem ber
10, and 2.30 per cent at the recen t low in prices on F ebru ary 15.

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