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MONTHLY REVIEW of Financial and Business Conditions F ifth Federal reserve Z^7’"" k c ..... * 3 Federal Reserve Bank, Richmond, Va. D ISCOUNTS at the Federal Reserve Bank of Rich mond continued to increase moderately between the middle of July and the middle of August, and there was a seasonal increase in the circulation of Federal Reserve notes, caused chiefly by the opening of auction tobacco markets in South Carolina and border markets in North Carolina. Member banks increased their reserve deposits slightly last month, and the Reserve bank’s cash reserves also rose. Reporting member banks increased their loans and discounts between July 14 and August 11, and invest ments in securities also increased slightly. Demand de posits increased last month, but there was a small decrease in time and savings deposits, as frequently occurs at va cation time. Debits to individual accounts figures in 24 cities decreased by 2.6 per cent in July in comparison with debits in June, but exceeded those of July 1936 by 8.1 per cent. Business and industry in July was in reduced volume in comparison with other recent months, part of which was seasonal, but the decline was somewhat more marked than seasonal influences account for. In comparing July 1937 figures on trade with those for July 1936, it should be borne in mind that the payment of the Bonus last year furnished a stimulant to business last summer. Employ ment in July showed comparatively little change in either direction, but the trend in most industries was downward for the vacation season. The bankruptcy record last month was good, and both the number of insolvencies and aggregate liabilities involved declined materially from July 1936 figures. Registrations of new passenger automobiles in the Fifth district declined 10.2 per cent in July 1937 below registrations in July 1936, but many buyers con tinued to purchase slightly higher priced cars this year. Construction plans lagged last month behind those made in July last year, building permit valuation figures in 31 leading cities falling by 15.9 per cent. However, con tracts actually awarded in the district exceeded the value of awards in July 1936 by 28.6 per cent. Production of bituminous coal declined 1.2 per cent in July in compari son with production in July last year. Textile mills re stricted operations materially last month, and for the first D istrict August 31, 1937 month in two years consumed less cotton than in the cor responding month of the preceding year. Cotton mills frequently close for a few days in July to allow operatives a rest and to enable the mills to clean and overhaul ma chinery, but the recession in working time this July was greater than usual. Cotton prices continued to fall be tween the middle of July and the middle of August, the Government's first forecast of probable cotton production on August 9 confirming earlier unofficial forecasts of a greatly increased cotton yield this year. Tobacco manu facture in July was larger than in July last year insofar as cigarettes were concerned, but production of cigars, smoking and chewing tobacco, and snuff fell below last year's output. Retail trade as reflected in department store sales was in approximately the same volume in July as in the corresponding month last year, about half of the reporting stores showing larger and half showing smaller sales last month. South Carolina stores showed the best record for the month. Wholesale trade in July 1937 was moderately above trade in July last year in all lines except dry goods for which data are available. Prospects for crop yields improved further in July and early August with continued favorable weather, and most estimates of production were raised on August 1 above the forecasts made on July 1. Tobacco sales began early in August in South Carolina and a few towns in North Caro lina, and large sales have been reported at prices probably averaging better than 25 cents per pound. No official fig ures on sales or average prices will be available until Sep tember. There follows a statistical summary of conditions de scribed above: % July 1937 July 1936 Change Debits to individual accounts (24 cities) .......................................... $1,323,424,000 $1,224,374,000 No. of business failures, 5th district 27 40 Liabilities in failures, 5th district.. $ 180,0t00 $ 703,000 Sales, 52 dept, stores, 5th district... $ 6,745,592 $ 6,977,375 Sales, 57 wholesale firms in 5 lines .$ 4,944,799 $ 4,742,641 Registrations, new passenger autos. 24,130 26,882 Value bldg. permits (31 cities)........ $ 7,866,938 $ 9,355,783 Value of contracts awarded, 5th dist. $ 27,635,600 $ 21,492,100 Cotton consumption, 5th dist. (Bales) 276,415 285,140 Soft coal mined, U. S. (Tons).......... 31,610,000 32,005,000 + 8.1 — 32.5 — 74.4 — 3.3 4- 4.3 — 10.2 — 15.9 +28.6 — 3.1 — 1.2 MONTHLY REVIEW 2 BA N K IN G CONDITIONS B a n k Statem ents : Discounts for member banks rose further between the middle of July and the middle of August, but open market paper and industrial advances for working capital declined slightly. A sea sonal increase occurred in Federal Reserve notes in actual circulation, chiefly due to opening of tobacco markets in South Carolina and border North Carolina towns early in August. Member bank reserve deposits and the Bank’s cash reserves both advanced last month. R eserve ITEMS Discounts held .............................................. Open market paper ..................................... Industrial advances ..................................... Government securities ................................. Total earning assets ................... >.......... Circulation of F’ed. Res. notes ................. Members’ reserve deposits ......................... Cash reserves .............................................. Reserve ratio ................................................ 000 Aug. 15 1937 $ 1,266 120' 2,539 133,035 136,960 195,382 213,736 306,547 70.12 omitted July 15 1937 $ 869 146 2,566 133,035 136,616 191,320 211,189 290,579 69.09 Aug. 15 1936 166 121 4,064 128,011 132,362 183,779 202,129 289,536 69.86 $ 41 R e p o r t i n g M e m b e r B a n k s : Report ing member banks in twelve Fifth district cities increased loans and discounts by $5,618,000 between July 14 and August 11 this year, and on the latter date loans and dis counts exceeded those on August 12, 1936, by $42,787,000. Investments in securities also rose by $4,213,000 last month, but declined by $40,369,000 during the year. De mand deposits rose by $4,828,000 during the month and $26,386,000 during the year, while time deposits fell by $838,000 between July 14 and August 1 1, but rose by $1,783,000 since August 1 2 , 1936 S t a t e m e n t of ITEMS Loans & discounts ............................... Investments in securities ................... Reserve bal. with F. R. Bank .......... Cash in vaults .................................... Demand deposits ................................. Time deposits ...................................... Money borrowed ................................. 000 omitted July 14 Aug. 11 1937 1937 $236,404 15242,022 398,336 394,123 128,683 126,786 18,223 18,747 462,651 457,823 198,218 199,056 0 1,500 Aug. 12 1936 $199,235 438,706 138,975 18,005 436,265 196,435 0 D e b it s to I n d i v i d u a l A c c o u n t s : Reflecting the vol ume of business passing through banks, debits to individ ual, firm and corporation accounts in 24 Fifth district cit- CITIES Maryland Baltimore .......... Cumberland ........ Hagerstown ........ Dist. of Col. Washington ... Virginia Danville .............. Lynchburg .......... Newport News . . Norfolk ................ Portsmouth ........ Richmond .......... Roanoke .............. West Virginia Charleston .......... Huntington ........ North Carolina Asheville ............ Charlotte ............ Durham .............. Greensboro .......... Raleigh .............. Wilmington ........ Winston-Salem . . South Carolina Charleston .......... Columbia ............ Greenville .......... Spartanburg . . . . District, 24 Cities July 1937 000 omitted June July 1936 1937 % of Change Month Year + 8.3 + 15.2 + 15.2 $ 380,479 11,082 11,020 $ 379,827 10,700 9,235 $ 351,367 9,623 9,562 266,015 317,445 254,079 — 16.2 + 4.7 9,509 17,497 11,161 54,397 4,246 160,072 30,761 8,6(>6 15,8^6 9,511 52,314 4,507 147,108 32,3 18 7,831 16,861 9,606 49,146 4,205 146,163 28,869 + 9.7 + 10.6 + 17.3 + 4.0 - 7.0 + 8.8 — 4.8 + + + + + + + 21.4 3.8 16.2 10.7 1.0 9.5 6.6 60,078 19,493 59,8:>0 20,632 55,045 16,621 + .4 - 5.7 + 9.1 + 17.3 14,306 57,824 27,752 20,170 40,144 10,834 40,498 13,882 58,631 26,1:21 18,978 37,883 11,346 43,211 12,534 52,489 24,801 17,681 39,432 10,048 41,. 059 + + + + — - 3.1 1.5 6.2 6.3 6.0 4.5 6.3 + 14.1 + 10.2 + 11.9 + 14.1 + 1.8 + 7.8 — 1.4 19,160 26,897 20,541 9,488 $1,323,424 20,837 31,910 19,153 8,797 $1,358,798 14,412 24,494 20,276 8,170 $1,224,374 - 8.0 — 15.7 + 7.2 + 7.9 - 2.6 + 32.9 + 9.8 + 1.3 + 16.1 + 8.1 + *2 + 3.6 + 19.6 ies declined by 2.6 per cent in July in comparison with debits in June this year, but exceeded July 1936 debits by 8.1 per cent. Fifteen of the 24 cities reported larger figures for July than for June this year, but a decline of $51,000,000 in Washington and smaller decreases in 8 other cities pulled the district total below the earlier month. In comparison with debits in July 1936, every city except Winston-Salem reported higher figures for July this year. M u t u a l S a v i n g s B a n k D e p o s i t s : Ten mutual savings banks in Baltimore had deposits totaling $216,704,389 on July 31, 1937, a decline of 2/10ths of 1 per cent under $217,192,727 on deposit on June 30, 1937, but an increase of 3.5 per cent over deposits totaling $209,444,513 on July 31, 1936. Savings deposits frequently show moderate de clines at vacation season. B U SIN E SS CONDITIONS E m p l o y m e n t : Midsummer dullness in many lines tended to lower employment and reduce payroll totals during the past month, but otherwise there was little change in the labor situation in the Fifth Reserve district. Auction to bacco warehouses took on several hundred employees in the Carolinas, and other markets to open later in August, September and October will employ additional workers. Apple growers express some concern over the supply of pickers and packers to handle the large apple crop when it is ready for harvest. The following figures, compiled for the most part by the Bureau of Labor Statistics from reports submitted by a large number of identical industries, show the trends of employment and payrolls in the Fifth district from May to June 1937, the latest available figures: STATES ..................... D. of Columbia ............................. ..................... ..................... West Virginia ............................... ..................... North Carolina ............................. ..................... South Carolina ............................. ..................... Percentage change from May to June 1937 In number In amount of payroll onpayroll — .9 — .1 + 1.8 + 1 .7 + 1.2 - 1.2 + 2.1 + 1 .1 — 1.1 — 3.2 — 1.8 — 2.8 C o m m e r c ia l F a il u r e s : The bankruptcy record in the Fifth Reserve district in July was better than the record for the United States as a whole. Failures last month in the district showed a decrease in number of 32.5 per cent in comparison with figures for July last year, while the National total declined only 3.3 per cent. In aggregate liabilities involved in July 1937 insolvencies, the district showed a decline of 74.4 per cent and the United States a drop of 21.6 per cent below July 1936 liabilities. The following detailed figures were reported by Dun & Bradstreet: PERIOD July June July Number of failures District U. S. Total Liabilities District U. S. 1937............................. 1937............................. 1936............................. 27 37 40 618 670 639 $ 180,000 442,000 703,000 $ 7,766,000 8,191,000 9,904,000 7 Months, 1937..................... 7 Months, 1936..................... 300 298 5,260 5,953 $2,564,000 5,247,000 $62,581,000 97,077,000 A utomobile N ew C ar R egistrations : All states ex cept South Carolina in the Fifth Reserve district reported fewer new passenger automobile registrations in July this year than in July 1936, total sales in the district declining 10.2 per cent. Registrations o f the three most popular 3 MONTHLY REVIEW makes made up 64.3 per cent of all registrations in July this year, compared with 71.8 per cent in July last year. The following figures, collected by R. L. Polk & Com pany of Detroit, show registration figures for the Fifth district by states for July 1937 and 1936, and the first 7 months of both years: Registration of New Passenger Cars STATES Maryland .......... D. of Col............. Virginia ............ West Va.............. No. Carolina . . . So. Carolina . . . . District ........- July 1937 4,809 2,880 4,679 3,597 5,455 2,710 24,130 July 1936 4,945 3,275 5,423 4,817 6,036 2,386 26,882 % Change — — 2.8 12.1 — 13.7 — 25.3 — 9.6 + 13.6 -10.2 7 Months 7 Months 1935 1937 27,924 30,793 21,657 19,599 32,955 31,302 24,979 24,473 28,067 34,164 17,959 14,105 159,943 148,034 % Change +10.3 — 9.5 + 5.3 - 2.0 + 21.7 + 27.3 + 8.0 C o n s t r u c t io n : For the second month in succession, permits issued by building inspectors in 31 Fifth district cities totaled less last month than in the corresponding month of the preceding year. The estimated value of permits issued in July 1937 was $7,866,938, a decrease of 15.9 per cent in comparison with the July 1936 total of $9,355,783. Only 12 of the 31 cities reported higher fig ures for the current month. Contract award figures for June, now available by States in F. W. Dodge Corporation reports, show an in crease in the Fifth district of 81.7 per cent over awards in June 1936, largely due to a large volume of work in Washington. Contract award figures include rural as well as urban projects, and are a better measure of con struction activity than building permit figures. Construction Contracts Awarded states Maryland ......................... D. of Col. .. ..................... Virginia .................................... West Virginia ................ North Carolina .............. . . . . South Carolina ............... ........ District ............... ..... ........ June 1937 $ 7,133,500 16,264,900 7,170,000 3,930,000 5,578,900 1,243,700 $40,321,000 June 1936 $ 4,479,700 7,218,400 3,623,800 743,700 3,875,200 2,246,300 $22,187,100 % Change + 59.2 + 125.3 + 97.9' + 294.0 + 44.0 — 44.6 + 81.7 : Bituminous coal production in the United States in July this year totaled 31,610,000 net tons, a decrease of 1.2 per cent from 32,005,000 tons mined in July 1936, but total production in the seven elapsed months of 1937 totaling 253,721,000 tons exceeded production of 232,836,000 tons in the first seven months of 1936 by 9.0 per cent. Shipments of coal through Hampton Roads totaled 13,159,955 tons between January 1 and August 7, 1937, an increase of 15.6 per cent over 11,381,655 tons shipped in the corresponding period last year. Official fig ures by States for June production in tons this year and last are now available from reports of the National Bitu minous Coal Commission: C oal M in in g STATES West Virginia ......................... Virginia ................................... Maryland ................................. 5th District ......................... United States ................. Production Production Percentage June 1937 June 1936 Change 9,440,0008,697,000 + 8.5 1,012,000777,000 +30.2 105,000 116,000 — 9.5 10,557,0009,590,000 +10.1 31,726,00029,217,000 + 8.6 C otton T e x t il e s : Cotton mills in both the Fifth dis trict and the United States reduced operating time in July, partly due to seasonal influences and partly to uncer tainty as to the future until information on this year’s probable cotton crop became available. Cotton consump tion in the Fifth district in July 1937 was 3.1 per cent below consumption in July last year, last month being the first month since May 1935 to fall below the corresponding month of the preceding year. Consumption of cotton by States in the district in July 1937, June 1937, and July 1936, in bales, is shown below: MONTHS July June July N o. Carolina So. Carolina Virginia District 1937................................. 1937................................. 1936................................. 143,568 164,919 154,289 118,014 133,672 117,391 14,833 16,008 13,460 276,415 314,599 285,140 7 Months, 1937........................... 7 Months, 1936........................... 1,205,460 1,016,101 907,700 769,686 104,617 96,485 2,217,777 1,882,272 Figures on spindle activity in June were released by the Bureau of the Census on July 20. There were 26,936,610 spindles in place in American mills on June 30, of which Fifth district mills had 12,382,214 spindles. Ac tual spindle hours of operation in June totaled 8,595,344,360 hours in the United States, South Carolina rank ing first with 2,232,643,688 hours and North Carolina sec ond with 1,898,766,311 hours. South Carolina also led in actual hours of operation per spindle in place with 394, compared with the National average of 319, and Virginia with 335 hours was also above the average, but North Carolina with 313 hours was below the average. : Spot cotton prices have steadily declined on Southern markets since the first of April, dropping from an average for middling grade of 14.62 cents per pound on April 2 to 10.56 cents on August 13, the latest date for which official averages are available. The decline was due to several adverse influences, chief among them being favorable prospects for a large crop this year and de creased demand for American cotton in foreign markets. On August 9, the Department of Agriculture issued a forecast of 15,593,000 bales for this year’s crop, an in crease of 3,194,000 bales, or 26 per cent, above 1936 pro duction of 12,399,000 bales. In the Fifth district, Vir ginia with prospects for 42,000 bales showed a 27 per cent increase over last year, North Carolina with 727,000 bales was up 22 per cent, and South Carolina with 863,000 bales increased 6 per cent. Every cotton state showed prospects for larger yields this year. C otton Cotton Consumed and On Hand (Bales) Fifth district states: Cotton consumed ................. Cotton growing states: Cotton consumed ................. Cotton on hand July 31 in Consuming establishments Storage & compresses . .. United States: Cotton consumed ................. Cotton on hand July 31 in Consuming establishments Storage & compresses ----Exports of cotton ..................... July 1937 276,415 1,010,488 2,725,560 583,066 July 1936 Aug. 1 to July 31 This Year Last Year 285,140 3,703,834 3,042,676 507,580 6,622,305 5,335,801 706,506 5,893,720 607,056 7,944,803 6,351,160 1,289,707896,72-4 .................................... 2,807,7983,937,665 ............................. 124,312 156,262 5,440,044 5,972,566 Cotton seed received at United States mills during the year ended July 31, 1937, totaled 4,516,464 tons, compared with 3,750,102 tons received in the year ended July 31, 1936. Of the receipts mentioned, North Carolina mills took 232,943 tons this year and 224,000 tons last year, and South Carolina mills took 221,673 tons and 208,757 tons in the two periods, respectively. M a n u f a c t u r in g : The Bureau of Internal Revenue reports tobacco products manufactured in July 1937 and 1936 as follows: T obacco 4 MONTHLY REVIEW July 1937 Smoking & Chewing Tobacco, Pounds .............. Cigarettes, Number ................ Cigars, Number ..................... Snuff, Pounds ........................... R e t a il T rade D epartment in Net Sales July 1937 comp with July 1986 Baltimore (8) Washington (6) Other Cities (14) District (28) . + 3.6 — 11.5 — .7 — 4.2 July 1936 26,702,350 15,290,072,227 476,439,266 2,816,456 28,129,898 14,801,028,247 482,447,774 3,196,557 % Change — 5.1 + 3.3 — 1.2 — 11.9 Stores: Net Sales Stocks Jan. 1 to date July 31, 1937 compared -with compared with same period July 31 June 30 1936 1937 last year + 7.2 — 9.7 8.1 + .9 + 16.1 — 6.1 + 8.4 + 13.2 — 4.1 12.1 — 7.2 + 4.7 + + Ratio July collections to accounts outstanding July 1 31.1 25.5 29.6 28.1 sales or average price figures are yet available, unofficial reports indicate that a large volume of tobacco has been sold at prices running somewhat above 25 cents. The following figures show forecasts of probable pro duction based on August 1 condition figures, compared with yields in 1936 and in the five-year period 1928-1932, for all Fifth district states: Cotton (Bales) - f 10.2 W h o l e sal e T r ade, 57 F ir m s : Maryland .......... Virginia ............ West Virginia .. North Carolina South Carolina + 1.0 + 3.0 1.0 + 8.6 — — 3.3 Net Sales July 1937 comp, with July June 1936 1937 LINES + 1.5 — 9.7 + 9.3 + 19.6 + 4.0 + 3.2 — 4.7 + 55.1 — .8 — 2.8 + 8.4 + 11.7 + 14.0 + 5.4 Stocks Net Sales Ratio July Jan. 1 to date July 31, 1937 collections compared with compared with to accounts same period July 31 June 30 outstanding July 1 1936 1937 last year 123.1 + 8.2 — 6.3 + 12.4 36.3 + 5.3 + 85.6 +62.6 + 32.3 +28.2 52.8 + 16.0 44.2 + 15.2 + 9.0 + 25.5 70.0 + 14.0 + 10.7 — 2.4 A G R IC U LT U R A L CONDITIONS Weather continued favorable for crop development during July and early August, and the estimates of probable production based on August 1 conditions were higher for many crops than the estimates made a month earlier. Few estimates were reduced during the month. Tobacco markets in South Carolina and in North Carolina cities adjoining South Carolina opened early in August, and, while no official E s t im a t e s : 18,576,000 38,097,000 + 14,784,000 — 44,194,000 24,210,000 + 18,396,000 30,014,000 11,569,000 43,475,000 23,635,000 14,431,000 30,388,000 11,054,000 38,415,000 20,240,000 Irish Potatoes (Bushels) Drugs Note: All figures in Retail & Wholesale tables represent percentage changes except the collection ratios. Nunber of reporting firms shown in parentheses. C rop C o n d it io n s a n d 1928-1932 Com (Bushels) Maryland .......... Virginia ............ West Virginia . North Carolina South Carolina . Same stores by States, with 24 stores added: Virginia (1 1 )... West Va. ( 9 ) ... No. Carolina (7) So. Carolina (10) District (52).. 1936 33,000 597,000 816,000 1937 42,000 727,000 863,000 Virginia North Carolina South Carolina . 3,500,000 10,810,000— 3,040,000-49,200,000 2,576,000 + 2,940,000 7,380,000 1,920,000 5,986,000 1,656,000 3,339,000 14,328,000 3,445,000 7,540,000 2,748,000 1,200,000 4,366,000 7,560,000 4,845,000 1,299,000 4,270,000 7,141,000 4,648,000 Sweet Potatoes (Bushels) Maryland ........ Virginia . . . . . . North Carolina South Carolina . . 1,520,000 4,875,000 + 8,500,00 — 4,698,000)+ Maryland .......... Virginia ........... West Virginia . North Carolina South Carolina Tobacco (Pounds) 24,850,000 + 96,094,000 + 2,516,000 + 546,940,000 + 101,920,000 + 29,600,000 96,734,000 1,282,000 457,375,000 73,350,000 24,318,000 98,409,000 4,224,000 469,135,000 75,918,000 Maryland .......... Virginia ............ West Virginia . North Carolina Apples (Bushels) 2,613,000 — 18,720,000 + 9,760,000 + 4,240,000 2,014,000 8,500,000 4,395,000 1,890,000 2,067,000 13,116,000 6,837,000 3,199,000 Peanut Condition, August 1 . . . 87 83 North Carolina .. .......... .......... 73 South Carolina 73 76 66 80 78 72 Pasture Condition, August 1 .......... 85. , 92 .......... 88 — West Virginia 80— North Carolina . . .......... 73 + South Carolina . .. .......... 53 52 45 60 53 67 72 78 77 72 Note: Estimates marked ( + ) were raised and those marked ( — ) lowered between July 1 and August 1. (Compiled August 21, 1937) MONTHLY REVIEW, August 31, 1937 FEDERAL RESERVE BANK OF RICHMOND SUMMARY OF NATIONAL BUSINESS CONDITIONS (Compiled by the Board of Governors of the Federal Reserve System) IN D U ST R IA L PRODUCTION Total volume of industrial production and distribution of commodities to consumers showed little change from June to July, when allowance is made for the usual summer declines. PRODUCTION AND EMPLOYMENT Index of physical volume of production, ad justed for seasonal variation, 1923-1925 average100. By months, January 1929 to July 1937. FACTORY EM PLO YM EN T The Board's seasonally adjusted index of industrial production was 114 per cent o f the 1923-1925 average in July, the same as in June and 4 points lower than in March, April and May. At steel mills, where output in June had been curtailed by strikes, activity increased considerably in the early part of July and was maintained at the higher level between the middle of July and the third week of August. Lumber production also increased in July, while output of plate glass showed a substantial decrease. Automobile assem blies declined seasonally. Output of non-durable manufactures decreased con siderably, owing largely to a marked decline in activity at cotton and woolen textile mills. Meat packing also declined, while flour milling and sugar refining increased. At mines, output of anthracite was reduced in July, while output of most other minerals showed little change. Construction contracts awarded, as reported by the F’. W. Dodge Cor poration, were maintained in July at the level reached in June. Non-residential construction expanded further, reflecting principally a large volume of awards for iron and steel plants and for railroad projects. Residential build ing showed a seasonal decline. Factory employment increased somewhat from the middle of June to the middle of July, when a decline is usual, and factory payrolls decreased less than seasonally. The largest increases in employment were in the steel indus try and in the food industries, particularly at canning factories. Other manu facturing industries as a group showed somewhat less than the usual seasonal decline. AGRICULTURE Index of number employed, adjusted for seasonal variation, 1923-1925 average=100. By months, January 1929 to July 1937. W H O LESA LE P R IC E S A cotton crop of 15,593,000 bales, representing an increase of 3,200,000 bales over last season, was forecast by the Department of Agriculture on the basis of August 1 conditions. Official estimates indicate that other major crops will be considerably larger than last season and about equal to the average for 1928-1932. Preliminary estimates by the Department of Agri culture indicate that cash farm income, including Government payments, will total $9,000,000,000 for the calendar year 1937, an increase of 14 per cent over 1936. DISTRIBUTION Distribution of commodities to consumers in July continued at the level of other recent months, when allowance is made for the usual summer decline. Sales at department stores and variety stores showed slightly less than the seasonal decrease in July, while mail order sales declined somewhat more than seasonally. Freight-car loadings increased, reflecting in part larger shipments of grains and forest products. COMMODITY PRICES From the middle of July to the third week of August prices of grains and cotton declined substantially, while livestock and meats showed a further in crease. Automobile prices were raised by most producers, carpet prices ad vanced, and there were increases in several industrial raw materials, including hides, zinc, lead and steel scrap. Cotton goods and rubber declined somewhat. BANK CREDIT Index compiled Labor Statistics, 1931; by weeks, for week ending by the United States Bureau of 19i26=100. By months, 1929 to 1932 to date. Latest figure is August 14, 1937. M EM BE R BANK LOANS AND INVESTMENTS From the middle of July to August 4, excess reserves of member banks were sharply reduced from $960,000,000 to $700,000,000, but subsequently they increased to $780,000,000 on August 18. These changes in member bank reserves reflected principally fluctuations in the volume o f Treasury deposits in Federal Reserve banks, together with a seasonal increase in money in cir culation. Excess reserves at New York City banks declined from $230,000,000 to about $40,000,000 and subsequently increased to $130,000,000. Total loans and investments of reporting member banks increased some what during the four weeks ending August 18, reflecting principally an increase of $150,000,000 in commercial loans offset in part by a further decline in holdings of United States Government obligations, principally at New York City banks. The growth in commercial loans occurred both in New York City and in other cities and included the purchase by banks of a large portion of the $60,000,000 of 9-month notes sold by the Commodity Credit Corporation on August 2. United States Government deposits at reporting banks increased during the period, reflecting purchases by banks of Treasury bills on a book-credit basis. Bankers' balances and other demand deposits showed further declines at New York City banks. MONEY RATES Wednesday figures for reporting member banks in 101 leading cities, September 5, 1934, to August 18, 1937. Loans on real estate and loans to banks excluded. Rates on Treasury bills declined slightly after the middle of July, and open-market yields on Treasury notes and bonds also declined early in August, but later there was a rise in yields. In the latter part of August discount rates were reduced from 2 per cent to IV2 per cent at the Federal Reserve Banks of Atlanta, Chicago and Minneapolis. The 2 per cent rates had been in effect since early in 1935.
@FedFRASER