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MONTHLY

REVIEW

o f Financial and Business Conditions

F if t h
F ederal

Reser ve
District

August 31, 1940

Federal Reserve Bank, Richmond, Va.

Summary of July Business Conditions
capacity, and in some plants preparations for expansion
o f facilities were pushed. Miscellaneous manufacturers
are in general operating more nearly full time than in
many months.

BUSINESS in July in the Fifth Federal Reserve dis­
None
o f the leading indicators declined more than seasonally,
and most of them registered better results than is ex­
pected at this time o f year. In comparison with July
1939, last month showed substantial improvement in
nearly all lines. Probably a considerable part o f the in­
creased activity is due either directly or indirectly to the
preparedness program.
Distribution of goods to consumers continued higher
than a year ago, but showed some seasonal decline from
June. Department store sales dropped 9 per cent from
the previous month, July usually being a relatively poor
month in wearing apparel and piece goods, but averaged
14 per cent more than sales in July last year. Furniture
stores also reported a 9 per cent decline in last month’s
sales under June sales, but gained 10 per cent over sales
in July 1939. Wholesale firms in a dozen or more lines
sold more than in either June this year or July last year,
and registration o f new passenger automobiles in July
also exceeded those in either June 1940 or July 1939.
In industry, developments during July were somewrhat
conflicting. Textile mill activity declined slightly from
the level of the preceding month, and production exceeded
sales of textile products.
On the other hand, rayon
manufacturers shipped more yarn than they made, and
further reduced already small reserve stocks. Coal mines
increased output further, and production during July
was 23 per cent higher than production o f coal in July
last year. Shipyards and airplane plants operated at

B ' trict was above seasonal level 011 the whole.

Construction expanded sharply in July. Building per­
mits issued in 31 Fifth district cities rose 32 per cent
above June in valuation, and were 4 per cent higher than
figures for July 1939. Contract awards in the district
in July nearly doubled June figures, and were 63 per cent
above awards in July last year.
Storms and floods around mid-August did serious dam­
age to some crops, the extent o f which is yet undeter­
mined. Weather in July was favorable for plant growth,
and on August 1 prospects for generally satisfactory
yields were good. Cotton overcame in July much o f the
late start, and a larger yield than in 1939 is now forecast
for the Fifth district. The 1940 tobacco crop will be
between 40 and 45 per cent smaller than the 1939 crop,
but the reduction is due chiefly to a smaller acreage this
year. Tobacco markets already open are selling tobacco
at prices slightly higher than opening prices last year,
which must be considered satisfactory in view of the
large carry-over of tobacco from previous seasons and
absence o f foreign demand due to disturbed European
conditions. Prospective purchasing power for fall and
winter trade should be about the same in cotton grow ­
ing sections as a year ago, but cash income in tobacco
sections will probably be substantially smaller, in spite
o f Government payments to compensate partly for acre­
age reduction.

BUSINESS STATISTICS— FIFTH FEDERAL RESERVE DISTRICT

July 1940
Debits to individual accounts (25 cities)...
Sales, 31 department stores, 5th district...
Sales, 37 furniture stores, 5th district......
Sales, 194 wholesale firms, 5th district...
Registrations, new autos, 5th district........

$1:,408,226,000
7,099,101
$
972,989
$
$ 10,041,000
24,724

Number of business failures, 5th district.
Liabilities in failures, 5th district...............
Value of building permits, 31 cities............
Value of contracts awarded, 5th district—
Cotton consumption, 5th district (Bales)....

$
$

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




51
756,000
14,127,489
57,234,000
285,912
10.23
6.50
32,700,000
11,400,000
36,080,000

June 1940

July 1939

,
$1;367,716,000
9,770,329
$
1,074,064
$
9,602,000
$
24,135

$1,231,893,000
6,232.889
$
883.882
$
9,117,000
$
19.962

$
$
¥

47
801,000
10,719,466
29,161,000
271,127
10.64
6.50
31,400,000
12,800,000
32,340,000

$
$
$

35
486,000
13,635,565
35,117,000
255,264
9.28
32,900,000
26,400,000
29,391,000

Month

Year

3
9
9
5
2

+ 14
+ 14
+ 10
+ 10
+ 24
+ 46
+ 56
4- 4
4- 63
+ 12
+ 10

+
—
4+

9
6
4- 32
+ 96
+ 5
__ 4
0
+ 4
11
+ 12
+

_ "l
__ 57
+ 23

MONTHLY REVIEW

2
BAN K IN G STATISTICS

E M PLO Y M E N T EXPAN DS

RESERVE BANK STATEMENT ITEMS
Fifth District
000 omitted
ITEMS
August 15
July 15
1940
1940
Discounts held ............................................
Foreign loans on gold................................
Open market paper....................................
Industrial advances ...................................
Government securities ..............................
Total earning assets...............................
Circulation of Fed. Res. notes.................
Members’ reserve deposits.......................
Cash reserves .................................................
Reserve ratio ................................................

August 15
1939
$

560
87
23
1,067
137,064
138,801
202,007
257,993
377,097
74.01

$

140
$
158
0
0
0
0
790
871
122,470______122,624
123,400
123,653
231,824
230,463
304,162
319,933
493,514
481,759
80.35
80.13

SELECTED ITEMS— 41 REPORTING MEMBER BANKS
Fifth District
000 omitted
ITEMS
August 14
July 17 August 16
1939
1940
1940
Loans & discounts........................................
Investments in securities...........................
Reserve bal. with F. R. bank.................
Cash in vaults.................................................
Demand deposits .........................................
Time deposits ..............................................
Money borrowed ..........................................

$274,662
442,623
195,192
23,084
577,754
202,774
0

$272,357
412,811
211,504
21,615
578,646
202,412
0

$245,039
428,350
169,489
18,701
502,862
200,104
0

M UTU AL SAVINGS BANK DEPOSITS
10 Baltimore Banks
July 31
1940

July 31
1939

.$222,693,076

Total deposits

June 30
1940
$223,515,446

Dist. of Col.
Washington

000 omitted
June
1940

July
1940

July
1939

+ 12

346,938
8,878
8,962

+
+
+

4
4

+ 20
+ 8
+ 14

12,901
64,637
31,607
21,113
47,932
11,419
42,824

11,810
59,292
29,503
18,430
41,713
10,373
37,257

—
—
—
+
+
—

3
1
3
6
5
5
6

+ 12
+ 8
+ 4
+ 7
+ 20
+ 16
+ 8

21,642
27,673
17,946
10,386

15,757
24,901
18,298
9,653

— 7
- f 10
+ 8
— 6

+ 27
+ 23
+ 5
+ 1

$ 297,719

$ 266,293

415,299
9,608
10,190

389,042
9,253
9,802

North Carolina
Asheville ..............
Charlotte .............
Durham .................
Greensboro ...........
Raleigh .................
Wilmington .........
Winston-Salem . .

13,284
63,979
30,647
19,776
50,205
11,992
40,162

South Carolina
Charleston ...........
Columbia .............
Greenville ...........
Spartanburg . . . .

20,046
30,529
19,301
9,793

Virginia
Danville ...............
Lynchburg ...........
Newport N e w s ...
Norfolk .................
Portsm outh...........
Richmond .............
Roanoke ...............

% of Change
Year
Month

+ o

$ 299,105

Maryland
Baltimore ............
Cumberland .........
Hagerstown .........

. .

+

7

8,289
14,598
12,338
53,127
4,815
149,636
28,608

7,380
15,380
9,023
48,264
4,072
143,081
25,853

— 16
+ 6
+ 11
+ 9
+ 2
+ 4
— 2

West Virginiai
Charleston ...........
54,179
51,572
17,422
18,136
Huntington .........
Parkersburg . . . .
10,598
10,701
$1,367,716
District Totals. . . .
$1,408,226
+ 0 indicates increase of less than % of 1%.

45,197
15,440
10,145
$1,231,893

+ 5
— 4
— 1

6,948
15,426
13,640
58,013
4,906
155,127
28,051

-f 3

— 6

+ o

+ 51
+ 20
+ 20
+ 8
+ 9
+ 20
+ 13
+ 4
+ 14

C O M M E R C IA L FAILU RES
PERIODS

Number of Failures
District U. S.

Total Liabilities
District
U. S.

July 1940 ................................
June 1940 ................................
July 1939 ................................

51
47
35

1,175
1,114
1,153

$ 756,000
801,000
486,000

$ 16,213,000
13,734,000
14,999,000

7 Months, 1940.......................
7 Months, 1939.......................

345
366

8,294
9,028

4,172,000
4,151,000

99,694,000
115,430,000

Source:

Dun & Bradstreet.




Percentage change from
June 1940 to July 1940
in number
in amount
on payroll
of payroll
+ 1.6
— 0.1
— 2.4
— 2.1
— 16
— 0.9
— 0.4
— 0.2
+ 1.1
+ 2.3
+ 2.6
+ 1.3

STATES
Maryland ...............
Dist. of Columbia.
V ir g in ia .................
West Virginia . . .
North Carolina . .
South Carolina . .

$219,774,901

DEBITS TO INDIVIDUAL ACCOUNTS
Fifth District
CITIES

Such changes as occurred in employment in the Fifth
district in July and the first half of August denoted fur­
ther demand for workers at once or in the near future,
especially for labor in construction lines. Employment
in coal fields is better than usual for this season, and
cotton textile and rayon manufacturers continued opera­
tions last month at about the same levels as in June.
Shipbuilding and airplane plants expanded further their
need for skilled workers. A strike o f truck drivers in­
volving several hundred men is in progress in Richmond,
but on the whole relations between employers and em­
ployees appear to be harmonious in the district at pres­
ent. The following figures, compiled for the most part
by the Bureau o f Labor Statistics, show the trends of
employment and payrolls in the Fifth district from June
to July:

A U T O SALES A B O V E SEASON AL LE V E L

Automobile sales continue to show substantial advances
over sales a year ago, and registrations o f new passenger
cars in the Fifth district in July 1940 were larger than in
any other July since 1936. W ith the exception of April
this year, last month’s registrations exceeded those in any
other month since June 1937, and the July 1940 figure
was only exceeded 17 times in the past 187 months.
Sales o f used cars have not kept pace with new car
sales, but on the whole the market has been satisfactory
and dealers are not generally burdened with excessive
stocks. New car stocks were reduced further in July
as manufacturers stopped or sharply reduced production
o f 1940 models preparatory to the change-over to the
1941 line. Autom otive N ew s reports that eight manu­
facturers now have 1941 models on the production line.
The following registration figures for new passenger cars
were furnished by R. L. Polk & Co., o f Detroit :
REGISTRATION OF N EW PASSENGER CARS— NUMBER
STATES
Maryland .............
Dist, of Col..........
West V ir g in ia ....
North Carolina. ..
South Carolina...
District .............

July
1940
4,909
2,695
5,985
3,177
5,415
2,543
24,724

July
7 Months
%
1939 Change
1940
31,753
3,330
+ 47
2,095
+ 29
17,799
3,797
+ 58
34,590
3,393*
— 6
20,487
4,928
+ 10
32,071
2,419
17,738
+ 5
19,962
+ 24
154,438

7 Months
1939
23,976
16,170
25,853
13,939
27,347
15,330
122,615

%
Change
+ 32
+10
+ 34
+ 47
+ 17
+ 16
+ 26

C O N T R U C T IO N INCREASES

Both building permits issued and contracts awarded in
July increased sharply over those in June, and were also
above permits issued and contracts awarded in July last
year. Permits issued in 31 Fifth district cities totaled
$14,127,489 in July, an increase o f 32 per cent over the
$10,719,466 in June and 4 per cent above the $13,635,565 in July 1939. Washington led in valuation with
$5,539,435 last month (Government work not included),
followed by Baltimore with $3,258,536, Winston-Salem

MONTHLY REVIEW
with $734,000, Charleston, S. C , with $459,485, Rich­
mond with $422,989, Charleston, W . Va., with $414,170,
and N orfolk with $406,965. Contracts awarded in the
district in July 1940 totaling $57,234,000 were not only
96 per cent above June 1940 contracts and 63 per cent
above those for July 1939, but were the highest amount
for any month since April 1928, when the record of
$66,591,000 was set. Last month’s contract awards were
exceeded in only 3 months since complete district figures
became available in June 1921. The high valuation o f
contracts last month was chiefly due to publicly financed
construction, partly as a result o f the preparedness pro­
gram.
Figures collected by the F. W . Dodge Corporation by
states for July 1940 and 1939 on contracts actually
awarded in the Fifth Reserve district are as fo llo w s:
CONSTRUCTION CONTRACTS AW ARDED
STATES
Maryland ..........................................
Dist. of Col........................................
Virginia ............................................
West Virginia ................................
North Carolina .............................
South Carolina ..............................
Fifth District .............................

July 1940
& 7,951,000

6,197,000
31,728,000
1,575,000
5,882,000
3,901,000
$57,234,000

July 1939
$ 6,024,000
5,871,000
8,814,000
5,318,000
7,014,000
2,076,000
$35,117,000

% Change
+ 32
+
6
+260
— 70
— 16
+ 88
+ 63

C O A L PRO D U CTIO N RISES FU R TH E R

Bituminous coal production in the United States has
been unusually high since mid-winter, and output in
July totaling 36,080,00 net tons was 12 per cent above
32.340.000 tons mined in June this year and 23 per cent
above 29,391,000 tons in July last year. The greater
demand for coal this year is chiefly due to increased in­
dustrial activity, but exports, especially to Canada, have
also been a substantial factor in the gain. Total output
o f coal this calendar year to August 3 amounted to
260.028.000 tons, an increase of 31 per cent over 197,815.000 tons mined in the corresponding period in 1939.
Shipments of coal through Hampton Roads to August 3
were 13,793,961 tons in 1940 and 10,714,559 tons in
1939, an increase this year o f 29 per cent. The chief
increase was in foreign cargo coal, which rose 363 per
cent this year. In the Fifth district, which accounts for
between 30 and 40 per cent o f the bituminous coal output
o f the United States, production in July 1940, June 1940
and July 1939, was as follow s:
SOFT COAL PRODUCTION IN TONS
REGIONS
W est Virginia ...........................
Virginia ........................................
Maryland ......................................
5th District .............................
United States ........................
% in District...........................

July 1940
June 1940
July 1939
11,097,000
10,241,000
9,851,000
1,165,000
1,260,000
1,153,000
98,000___________ 99,000___________ 97,000
12,360,000
11,600,000
11,101,000
36,080,000
32,340,000
29,391,000
34.3
35.9
37.8

T E X TILE A C T IV IT Y A G A IN DECLINES

For the most part, business obtained in July by cotton
textile mills was disappointing, and sales were substan­
tially below mill production, according to the best avail­
able trade data. Prices for textiles held up remarkably
well, however, most constructions declining only about
an eighth o f a cent during the latter part of the month.
The Journal o f Commerce states that a sudden flare-up
in trading on the last day of July accounted for sales of
approximately 40,000,000 yards of print cloths, carded
broadcloths and related items, and nearly all prices
snapped back to the levels at which they started the




3

month. Trading in textiles on July 31 exceeded all the
rest o f the month, but dullness developed again in August
and mill activity has been only fairly well maintained
at recent levels. Sales o f finished goods appear to be
holding up somewhat better than unfinished cloth and
yarn. A considerable volume o f heavy industrial cloth
was sold in early August. Consumption o f cotton in
July was below the June level on an average daily basis,
but total consumption last month was higher because
July had two additional working days.
COTTON CONSUMPTION— FIFTH DISTRICT
In Bales
Virginia

District

July 1940 .............................
June 1940 ..............................
July 1939 .............................

MONTHS

No. Carolina So. Carolina
158,028
144,439
143,266

120,829
116,248
100,757

7,055
10,440
11,241

285,912
271,127
255,264

7 Months, 1940.....................
7 Months, 1939.....................

1,162,622
1,066,266

904,182
805,797

85,519
78,790

2,152,323
1,950,853

R A Y O N SHIPMENTS EXCEED PRO D U CTIO N

Manufacturers o f rayon filament yarn continued opera­
tions at about capacity levels in July, and shipments to
fabricators totaling 32,700,000 pounds exceeded output
by 1,400,000 pounds, already low reserve stocks being
reduced accordingly. Last month’s shipments compared
with 31,400,000 pounds in June this year and 32,900,000
pounds in July last year, while reserve stocks at the end
o f July 1940, totaling 11,400,000 pounds, compared with
12,800,000 pounds on hand a month earlier and 26,400,000
pounds on July 31, 1939. Rayon Organon reports that
a new field for the use o f rayon products is indicated in
experimental orders placed by the A rm y Quartermaster
Corps, one for satins to be used as linings in garments
for the A ir Corps and another for olive drab cloth con­
taining 30 per cent rayon staple fiber and 70 per cent
wool, to be used chiefly for shirts. It is understood that
the Navy is also experimenting with rayon linings in uni­
forms and overcoats o f enlisted men.
C O TTO N STATISTICS

Spot cotton prices on 10 Southern markets continued
to dccline steadily from the middle o f July through the
middle o f August, and on August 16 dropped below the
10-cent line to 9.93 cents for middling upland cotton. A
year earlier, on August 18, 1939, the average price was
8.95 cents.
The first forecast on production o f cotton was made
on August 8 by the Department o f Agriculture, and indi­
cated a yield o f 11,429,000 bales against 11,817,000 bales
in 1939 and a 10-year average o f 13,547,000 bales. In
the Fifth district, Virginia and North Carolina figures
are higher than last year’s, and more than offset a de­
cline in South Carolina. Figures for Fifth district states
are shown on page 4. The 1940 crop got a late start,
but the weather during most o f July and early August
was almost ideal for cotton and rapid progress was made.
In the district the crop is well fruited, and weevil damage
has been very slight.
On August 9, the details o f the 1940 Government cot­
ton loan were released. Rates range from 9.16 cents in
west Texas and New M exico to 9.90 cents in the Caro­
lina mill sections for middling 15/16 inch, net weight
basis. The rates are somewhat higher than those in
force in 1939, and are equal to about 56 per cent o f the
so-called parity price.

MONTHLY REVIEW

4
COTTON CONSUMPTION AND

ON HAND— BALES

July
1940

CROP FORECASTS

July Year Ended July 31
1939 This Year Last Year

Fif'th district states:
285,912
255,264
Cotton consumed .....................
Cotton growing states:
511,121
442,084
Cotton consumed .....................
Cotton on hand July 31 in
743,226
681,681
Consuming establishments. ..
Storage & compresses............ 9,044,748 11,586,232
United States :
597,850
521,353
Cotton consumed ......................
Cotton on hand July 31 in
973,542
862,105
Consuming establishments. ..
Storage & compresses............ 9,122,178 11,620,408
120,388
106,531
Exports of cotton, U. S............
Spindles active, U. S................. . 21,916,700 21,939,404

3,718,798

3,299,472

6,610,918

5,809,821

7,745,574

6,858,426

................................
................................
6,175,349 3,326,840
........

Bureau o f Internal Revenue receipts for July show
production of tobacco products as follow s:
June 1940

July 1940
26,241,167
15,912,640,803
460,522,504
3,091,422

July 1939

24,763,334
17,565,041,013
435,029,473
2,896,537

23,674,676
14,259,801,810
427,533,137
2,571,218

DEPARTMENT STORE TRADE

Richmond (3) . . .
Baltimore (8) . . .
Washington (6) . .
Other Cities (14)
District (31) . .

+
+
+
+
+

Net Sales
Stocks
Jan. 1 to date July 31, 1910
comp, with
comp, with
same period July
June
last year
1939
1940
+ 5.4
+ 7.5
+ 6.5
8.0
+ 6.9

9.6
12.3
16.6
13.5
13.9

+

Same stores by states,
with 24 stores added:
+ 10.9
Virginia (12)
+ 12.7
West Va. (10) . ..
+ 5.8
No. Carolina (8) .
+ 9.2
So. Carolina (11)

+
+
+
—
+

4.6
3.7
2.4
1.0
2.7

—
—
—
—
-

Maryland

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

West Virginia
North Carolina . ..
South Carolina . , .
Fifth District . .
Maryland

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

West Virginia
North Carolina
South Carolina
Fifth District

R E T A IL A N D W H O LESALE TR A D E

Net Sales
July 1940
comp, with
July
1939

Cotton
% Change
Acreage
North Carolina . ..
South Carolina . . .
Fifth District ..

C IG A R E TTE P R O D U C TIO N DECLINES

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

The following figures issued by the Department of
Agriculture show forecasts o f production based 011 A u ­
gust 1 conditions, compared with yields in 1939 and in
the 10-year period 1929-1938, and percentage changes
in acreage this year over or under 1939. Yield figures
marked ( + ) were raised between July 1 and August
1, and those marked ( — ) were lowered.

Ratio J uly
collections
to accounts
outstanding

July 1

1.8
6.8
5.2
7.3
5.6

31.8
32.0
29.2
28.3
30.3

Maryland

. ..
..
. ..
..

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

West Virginia
North Carolina
South Carolina
Fifth District

...
..
. ..
..

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

West Virginia
North Carolina . ..
South Carolina
Fifth District .

+ 5.2
+ 12.7
+ 9.6
+ 10.9

RETAIL FURNITURE SALES
c Change in Sales, July and 7 Months in 1940
/o

Compared with
July 1939

STATES

— 1
+ 15
+13
+ 29
4- 9

Maryland, 9 stores.............
Dist. of Col., 7 stores. . . .
Virginia, 10 stores.............
North Carolina, 4 stores.
South Carolina, 7 stores.
District, 37 stores........

+ 10

Individual Cities :

— 1
+ 18
+ 15

Baltimore, 9 stores...........
Richmond, 5 stores...........
Washington, 7 stores........

Compared with
7 Months 1939
+ 17

LINES
Auto supplies ( 7 ) ...........
Shoes (3) ............................
Drugs (13) .....................
Dry goods ( 8 ) ...................
Electrical goods (16) . ..
Groceries (57) ...............
Hardware (16) ...............
Indus, supplies ( 9 ) ........
Plumbing & heating (3)
Paper & products ( 9 ) . .
Tobacco & products (9)
Miscellaneous (44) . . . .
District average (194)
Source :

+ 5
— 17
+ 10
+ 5
+ 17
+ 9
+ 16
+ 33
+ 11
+ 23
+ 9
+ 17
+ 10

Bureau of the Census.




__ 7
+ 7
+ 3
— 1
+ 6
+ 2
— 2
+ 24
+ 9
+ 7
— 8
— 1
+ 5

Yield
1929-1938
37,000
658,000
820,000
1,515,000

Wheat (Bushels)
7,448,000
4
8,354,000
4
6
1,986,000
6,021,000 +
5
2,625.000
0
26*434,000 +
+ 3

7,352,000
7,511.000
2,102,000
5.100,000
2,415,000
24,480,000

8,518,000
8,73*5,00 9
2,080,000
4,661,000
1,175,000
25,169,000

Com (Bushels)
16,863,000 —
+ 1
35.114,000 +
— 2
12,879,000 —
— 1
—
1
43,938,000 —
+ 2
24,152,000 +
— 0
132,946,000 +

18,216,000
36,530,000
13,994,000
48,087,000
25,433,000
142,260,000

15,923,000
32,255,000
12.448,000
42,517,000
22,306,000
125,449,000

Oats (Bushels)
1.015,000
+ 15
1,932,000 +
+ 5
— 10
1,386,000 —
— 1
6,000,000 +
—
1
10,670,000
21,003,000 +
— 2

1,128,000
1,600,000
1,460,000
5,692,000
11,515.000
21,395,000

1,344,000
2,197,000
2,086,000
4,228,000
8,910,000
18,765,000

518,000
983.000
718,000
991,000
541.000
3,751,000

464,000
923,000
644,000
696,000
362,000
3,089,000

Irish ]
Potatoes (Bushels)
+ 4
2,782,000 —
2,375,000
0
10,452,000 +
6,786,000
0
3,200,000
3,040,000
8,7 48,000 —
- 1
8,200,000
0
3,192,000
3,108.000
0
28,374,000 +
23,509,000

3,098,000
11 ,'>07,000
2,925,000
7,976.000
2,124.000
27,930,000
1,090,000
4,156,000
8,163,000
5,220,000
18,629,000
26,096,000
97,395,000
3,262,000
496,101,000
81,068,000
703,922,000

6
9
1
4

20,000
588,000
840,000
1,448,000

+
+
—
+

+
+
+
+
+
+

2
3
1
7
5
4

(Tons)
5 7 0 ,0 0 0 1,178,000
820,000
1,000,000 —
483.000 —
4,051,000 —

+ 8

Maryland

+ 12

North Carolina . . .
South Carolina . . .
Fifth District . ..

Sweet Potatoes (Bushels)
1,350,000
1.440.000
+ 11
— 3
3,875,000 +
4,128,000
— 5
8,624,000
6,935,000 —
5,280,000 —
— 1
6,834,000
— 3
21,026,000
17,440,000 —

West Virginia
North Carolina . ..
South Carolina . ..
Fifth District . . .

Tobacco (Pounds)
26,460,000 +
29,796,000
— 1
— 33
94,035,000 +
143,847,00-0
2,635,000
— 6
2.736,000
— 41
430,823,000 — 811,675,000
— 40
73,960,000 — 133,200,000
-3 8
627,913,000— 1,121,254,000

7
+ 13
+ 16

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

+ 17
+ 3

+ 8

WHOLESALE TRADE— 194 FIRMS
Net Sales
July 1940
compared with
July
June
1939
1940

West Virginia
North Carolina . . .
South Carolina . . .
Fifth District . . .

Yield
1939
13,000
457,000
871,00'0
1,341,000

—
+
+
+

Hay
Maryland

(Bales)
Yield
1940

Stocks
July 31, 1940
compared with
July 31 June 30
1939
1940

Ratio July
collections
to accounts
outstanding
July 1
65

— 4
+ 1
+ 21
+ 1
+ 14
+12
+ 26

+ 21
+ 1
+ 21
— 4
+ 9
+ 6
+ 3

+ ’4

— 3

— *4
+ 6

— 0
+ 7

81
42
69
93
36
61
67
83
62
64

Apples,
Maryland

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

West Virginia . ..
North Carolina . ..
Fifth District . .

North Carolina . ..
South Carolina . . .
Fifth District . .
Maryland

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

West Virginia
North Carolina . ..
South Carolina . . .

(Compiled August 21, 1940)

Commercial (Bushels)
2,232,000
2,362,000
10,150,000
10,800,000
4,309.000
5,670.000
915,000
1,120,000
17,636,000
19,952,000

Peanu'ts (Pounds)
194,350,000
+ 5
304,750,000
+ 5
14,000,000
+15
513,100.000

189,175.000
290.700.000
11,840,000
491,715,000

Pasture Condition, August; 1
70 —
92 +
88 —
77 —
65 —

77
87
85
84
78

1,922,000
10,279,000
4,622,000
935,000
17,758,000
146,706,000
242,658,000
8,607,000
397,971,000
66
74
71
76
09

MONTHLY REVIEW, August 31, 1940

FEDERAL RESERVE BANK OF RICHMOND

S U M M A R Y OF N A TIO N A L B U S IN E S S C O N D ITIO N S
(Compiled by the Board of Governors of the Federal Reserve System)
INDUSTRIAL PRODUCTION

V olum e o f industrial output was steady during Ju ly and the
Augfust, a fter a rapid expansion in M ay and June. E m ploym en t
increase. R eflecting m ainly awards fo r national defen se projects,
contracts rose to the highest level in ten years. P rices o f basic
declined som ewhat fu rther.

first h alf o f
continu ed to
construction
com m odities

PRODUCTION

Index of physical volume of production, ad­
justed for seasonal variation, 1985-1939 a v e rage=
100. By months, January 1934 to July 1940.

CONSTRUCTION

CONTRACTS AWARDED

Three-m onth moving averages of F. W . Dodge
Corporation data for value of contracts awarded
in 37 Eastern States, adjusted for seasonal vari­
ation. Latest figures based on data for June and
July and estimate for August.

WHOLESALE PRICES

In July the B oard’ s revised index o f industrial production stood at 121
per cen t o f the 1935-39 average, a ccord in g to the prelim inary data. This is
the same as in June and 17 points above the level prevailin g a year ago b e fo r e
the outbreak o f war.
In m ost lines activity w as m aintained at the levels
reached in June or increased further.
Steel production in July w as at about 85 per cen t o f capacity and in the
first h alf o f A u gust there was an increase to abou t 90 per cent. P roduction
o f p ig iron and coke and output o f n on ferrou s metals w ere also in large volum e.
In the m achinery, shipbuilding, and a ircra ft industries, where new orders had
been large during the first h alf o f the y ear and a considerable b a ck log o f un­
filled orders had accum ulated, activity w as m aintained at high levels in July,
although ordinarily there are declines at this season.
L um ber production
declined sharply early in July bu t has subsequently increased accom panyin g
a considerable rise in new orders.
In the autom obile industry output declined sharply in July and the first
h alf o f A u gu st as plants w ere closed to prepare fo r the sh ift to new m odel
production. The decline was greater than at this season in other recen t years,
reflectin g the fa c t that production had been at high levels during the first h alf
o f 1940 and large stocks had accum m ulated. These stocks w ere reduced con ­
siderably in July as production was curtailed and retail sales continued large.
T extile production increased considerably fu rth er in July, reflectin g chiefly
a marked rise in activity at w oolen mills w here ou tpu t is still below the levels
o f a year ago. Production o f cotton and rayon textiles w as m aintained in July
and was in larger volum e than last summer, w hile activity at silk m ills increased
som ewhat fr o m the exception ally low level reached in June.
Shoe production
increased seasonally, while output o f m anu factu red food s, which in June had
been unusually large fo r that tim e o f year, show ed less than the custom ary
increase in July.
Coal production has risen fu rth er and shipm ents o f iron ore down the
Lakes have continued at near-capacity rates. Petroleum production has been
curtailed sharply, how ever, reflectin g partly a continued high level o f stocks
o f petroleum products.
V alue o f new construction w ork undertaken increased sharply in July,
ow ing m ainly to a fu rth er rise in public construction , and was at the highest
level in the past decade, accordin g to reports o f the F. W . D odge C orporation
and the Federal Reserve Bank o f San F rancisco. A w ards f o r both residential
and nonresidential private building increased som ewhat, although some decline
is usual at this season.
Increases were m ost pronounced in the A tlan tic, G ulf, and Pacific Coast
States, reflecting awards o f additional contracts fo r naval air station and ship­
yard construction. In the central portions o f the coun try there w ere generally
small increases, although in some areas aw ards w ere low er.

DISTRIBUTION
D istribution o f com m odities to consum ers was sustained in July at about
the levels prevailing in the first h alf o f the year. Sales at departm ent stores
declined m ore than seasonally, while sales at variety stores show ed little change,
although a decline is usual in July.
T otal freigh t-car loadings increased seasonally in July. Shipm ents o f grain
showed a considerable rise and loadings o f coal and coke continued to advance,
while shipments o f m iscellaneous freigh t, w hich include m ost m anu factu red
products, declined by som ewhat m ore than the usual seasonal am ount.
Indexes compiled by the U . S. Bureau of Labor
Statistics, 1926=100.
By weeks, 1934 to August
10, 1940.

COMMODITY PRICES
P rices o f basic com m odities declined som ewhat fu rth er from the m iddle o f
July to the middle o f A ugust, with decreases chiefly in prices o f com m odities
influenced b y foreign supplies, such as lead, rubber, cocoa , and coffee. Prices
o f steel scrap and zinc, on the other hand, advanced som ewhat in this period.

AGRICULTURE
MEMBER BANK RESERVES AND RELATED ITEMS

P rospects fo r m ost crops showed little change in July, accordin g to the
D epartm ent o f A gricu lture. P roduction this year is expected to approxim ate
the 1929-38 average and, considering carryovers, supplies o f m ost crops will
be large. Conditions fo r w heat and oats im proved during July, while the corn
crop showed some deterioration. A cotton crop o f 11,429,000 bales was indi­
cated f o r this season as com pared w ith 11,817,000 bales last season.

BANK CREDIT
T otal loans and investm ents at rep ortin g m em ber banks in 101 leading
cities increased substantially during the five weeks ended A u gust 14, ow in g
mainly to purchases o f direct and guaranteed securities new ly issued b y the
United States G overnm ent. Sale o f these securities caused a large increase in
Treasury balances with the Federal R eserve Banks. A s a result o f this tem ­
porary developm ent, excess reserves declined by $450,000,000 in this period
despite an increase o f over $500,000,000 in m on etary g old stock.
Wednesday figures, January 3, 1934, to August
7, 1940.




GOVERNMENT SECURITY MARKET
Prices o f United States G overnm ent securities w ere relatively steady during
July and the early part o f A u gu st but declined slightly around the m iddle o f
A u gu st accom panyin g news o f intensification o f European w arfare. The yield
on the 1960-65 bonds increased to 2.39 per cent on A u gu st 14 com pared with
2.34 per cen t on July 1 and 2.26 per cen t on A pril 2 at the y ea r’ s peak in prices.

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