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MONTHLY REVIEW
of Financial and Business Conditions

F ifth
Federal

r eser v e

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 istric t

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 1
8

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

July
1936

Aug. 1 to July 31
This Year Last Year

583,066

3,042,676

507,580 6,622,305
1,010,488
2,725,560

285,140 3,703,834

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 .

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

3,500,000
10,810,000—
3,040,000-49,200,000
2,576,000 +

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.

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