The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
MONTHLY REVIEW CREDIT, BUSINESS AND AGRICULTURAL CONDITIONS WILLIAM W. HOXTON, RICHMOND, VIRGINIA CHAIRMAN AND FEDERAL RESERVE AGENT FEDERAL RESERVE BANK OF RICHMOND ROM January first to midFebruary is a period of stock taking, and business is relatively dull in most years, and this year the slowness of trade was more pro nounced than usual. New business was harder to secure than in any other month since the depression began in the fall of 1929, especially in retail trade and in construction work. There were no marked de velopments in banking in the Fifth district from the middle of January to the middle of February, but there appears to be a more cheerful men tal outlook since the passage of the Reconstruction Finance Corporation Act by Congress at the end of January, and more particularly in anticipation of the passage of the Glass-Steagall bill. Federal reserve credit is be ing used much more extensively than at this time last year, and the volume of reserve notes in actual circulation is especially large, due doubtless to hoarding of currency by nervous persons who have drawn funds from their banks. This has ma terially reduced deposits in the banks of the dis trict, in comparison with deposits a year ago. Debits to individual accounts in the district in the four weeks ended February 10, 1932, showed a sea sonal decrease in comparison with debits in the four weeks ended January 13, 1932, and totaled 17.5 per cent less than debits in the four weeks ended February 11, 1931. Employment conditions not only failed to improve in January, but appeared to become somewhat worse as construction work declined still farther. Coal production last month was below seasonal level, because of reduced de mand from industrial consumers and exceedingly mild weather throughout most of the East. Textile mills held about the same rate of operations as in recent months, but business was hard to secure at profitable prices for textile products. Statistics on cotton consumption appear to indicate that condi tions in the textile industry are rather better in the FEBRUARY 29, 1932 Fifth district than in most other sec tions of the country. Spot cotton prices ruled somewhat higher from mid-January to mid-February than in the preceding month, but were still far below the price levels of other recent years. Cotton con sumption in the United States in January was in smaller volume than in January 1931, although consump tion in the Fifth district increased slightly in the 1932 month. Tobacco markets paid very low prices for producers’ tobacco in January, and there was practically no m arket at all for the lowest grades. Tobacco manufacturing in both January and in the year 1931 fell behind January 1931 and the year 1930, but last year Virginia paid more taxes on tobacco products than in 1930, chiefly because a large cigarette factory in Richmond was open all of 1931, but was not completed and opened until well into 1930. Estimated valuation for building permits issued in January in the Fifth district set a new low figure for any month since the war years, when practically all building was suspended, and contracts actually awarded for construction work also declined to a new low level. Retail trade as reflected in department store sales was poorer in January than in any month in many years, partly due to unseasonal weather. Wholesale trade also fell materially below the level of trade in January 1931. Reserve Bank Statement Rediscounts for member banks held by the Fed eral Reserve Bank of Richmond declined by $8,523,000 between January 15 and February 15, both this year, but on the latter date were $18,470,000 above rediscounts held on February 15, 1931. The portfolio of open m arket paper also declined last month, by $1,660,000, but advanced $5,572,000 during the year. On the other hand, the Bank in creased its holdings of Government securities by MONTHLY REVIEW 2 ITEMS Feb. 15 1932 000 omitted Jan. 15 Feb. 15 1931 1932 Rediscounts held _..................... $ 36,213 $ 44,736 $ 17,743 2,418 9,650 7,990 Open market paper----------------9,081 17,261 14,081 Government securities----------0 700 700 Other earning assets-----------37,422 64,167 58,984 Total earning assets----------84,343 Circulation of Fed. Res. notes.. 105,419 110,622 59,200 50,372 51,022 Members’ reserve deposits-----Cash reserves-------------------- 105,558 107,343 113,072 77.22 64.09 6524 Reserve ratio -------------------- ITEMS 000 omitted Feb. 10 Jan. 13 Feb. 11 1932 1931 1932 Loans on stocks and bonds (in cluding Governments)_____ $148,233 $144,624 $166,604 All other loans_____________ 220,790 224,712 270,129 Total loans and discounts— 369,023 369,336 436,733 Investments in stocks and bonds 233,807 234,130 183,600 33,154 40,319 33,799 Reserve bal. with F. R. Bank.... 15,838 16,689 13,729 Cash in vaults_____________ Demand deposits ---------------- 293,774 295,887 333,269 Time deposits______________ 223,720 224,457 246,342 22,617 5,226 14,711 Borrowed from F. R. Bank__ $5,(X ),000 between the middle of January and the X middle of February, but on the latter date held those on stocks and bonds rising by $3,609,000 $3,180,000 less in Government securities than on while all other loans decreased by $3,922,000. In February 15 last year. On February 15 and Janu vestments in bonds and securities declined $323,000 ary 15, this year, the Bank held $700,000 in other during the four weeks, but the banks increased earning assets, but held no paper of this type a year their reserve balances with the Federal reserve ago. The several changes in assets resulted in a bank by $645,000. Cash in vaults declined $2,109,net decline of $5,183,000 in total earning assets of 000 between January 13 and February 10, due chief the Federal Reserve Bank of Richmond during the ly to a lessening of the tension which caused many past month, but there was an increase in total earn banks to accumulate unusually large amounts of ing assets during the year amounting to $21,562,000. cash in their vaults in January. Deposits continued The circulation of Federal reserve notes declined to decline last month, demand deposits dropping $5,203,000 between January 15 and February 15, but $2,223,000 and time deposits dropping $737,000 be on the latter date was $21,076,000 above the circula tween January 13 and February 10. The fortytion on February 15, 1931. This marked increase in nine banks reduced their borrowings at the reserve note circulation during the year, in spite of a gen bank by $7,906,000 during the four weeks under erally reduced volume of business, is doubtless due review. to the hoarding of currency. Member bank reserve deposits at the Richmond reserve bank rose $650,In comparison with condition figures reported for 000 during the month between January 15 and February 11, 1931, those for February 10, 1932, February 15, but were $8,178,000 lower on the show material decreases in every item except in latter date than at the same time last year, the vestments and in rediscounts at the reserve bank. reduction during the year being due in part to a Total loans and discounts declined $67,710,000 dur smaller number of member banks and in part to ing the year, loans on stocks and bonds falling lower deposits in member banks against which re $18,371,000 and all other loans decreasing $49,~ serves are carried. The cash reserves of the Fed 339,000. In keeping with this decline in loans, de eral Reserve Bank of Richmond were lower on posits in the reporting institutions dropped $62,February 15 than on either January 15, 1932, or 117,000 between February 11, 1931, and February February 15, 1931, the table showing a decline of 10, 1932, demand deposits falling by $39,495,000 and $1,785,000 in the past month and $7,514,000 in the time deposits falling $22,622,000. Cash in vaults past year. The ratio of cash reserves to note and also decreased during the year, dropping $2,960,000, deposit liabilities combined rose by 1.15 points be and reserve balance with the reserve bank de tween January 15 and February 15, but on the latter creased $6,520,000. On the other hand, the banks date was 11.98 points lower than the ratio a year increased their investments in bonds and securities earlier. by $50,207,000 during the year, and also increased their borrowing at the Federal Reserve Bank of Member Bank Statement Richmond by $9,485,000. The figures in the accompanying table are totals of the principal items of condition as of three dates for Savings and Time Deposits forty-nine member banks in twelve cities of the Twelve mutual savings banks in Baltimore Fifth Federal reserve district. I t should be under showed a slight decline in deposits in January, a stood that the figures shown reflect the condition of continuation of the drop which began last Novem the reporting banks on the report dates only, and ber, but at the end of January deposits were still are not necessarily the highest or lowest figures materially higher than a year earlier. The twelve that occurred during the period under review. banks had deposits totaling $212,539,513 on January During the four weeks between January 13 and 31, 1932, compared with $213,515,559 on December February 10, 1932, loans and discounts at the forty- 31,1931, and $200,969,642 on January 31,1931. Time nine reporting member banks changed very little, deposits in forty-nine reporting member banks de but there was a shift in the classification of loans, clined during the past month from $224,457,000 on MONTHLY REVIEW January 13, 1932, to $223,720,000 on February 10, 1932, and on the latter date compared unfavorably with deposits aggregating $246,342,000 on February 11, 1931. The time deposits in reporting member banks contain a considerable amount of deposits which are not savings, and therefore the figures are more subject to fluctuations than the deposit fig ures in the mutual savings banks. Debits to Individual Accounts 000 omitted Total debits, four weeks ended Jan. 13, Feb. 11, Feb. 10, 1932 1932 1931 Asheville, N. C.------Baltimore, Md.---------Charleston, S. C.____ Charleston, W. Va----Charlotte, N. C.-------Columbia, S. C._____ Cumberland, \Md.------Danville, Va.________ Durham, N. C.______ Greensboro, N. C.......Greenville, S. C--------Hagerstown, Md-------Huntington, W. Va---Lynchburg, Va.______ Newport News, Va---Norfolk, Va......__ Portsmouth, Va.-------Raleigh, N. C.______ Richmond, Va.______ Roanoke, jVa._______ Spartanburg, S. C.---Washington, D. C.-----Wilmington, N. C.---Winston-Salem, N. C. .. $ 9,193 279,986 10,248 29,595 33,094 17,135 5,675 5,433 14,466 11,714 11,539 5,363 11,830 12,711 8,137 36,868 4,093 15,741 111,974 21,844 6,478 186,435 7,935 27,104 $ 9,144 282,268 8,178 30,689 33,940 19,306 6,361 7,785 23,339 15,802 13,631 5,819 12,729 13,744 8,591 41,111 4,762 22,086 108,441 23,870 8,440 190,934 8,567 23,060 $ District Totals------- $884,591 $922,597 $1,072,754 11,109 355,670 16,300 38,892 36,636 19,459 6,963 6,151 23,355 16,195 15,028 7,398 16,814 16,311 10,429 45,172 4,063 20,158 122,768 26,711 7,927 209,932 10,738 28,575 Aggregate payments by check drawn on clearing house banks in twenty-four cities of the Fifth Fed eral reserve district are shown in the accompanying table for three equal periods of four weeks, thus affording opportunity for comparison of the latest figures, for the four weeks ended February 10, 1932, with those for the preceding like period this year and the corresponding period a year ago. Debits in the four weeks ended February 10, 1932, totaling $884,591,000 showed a seasonal decrease from debits totaling $922,597,000 in the four pre ceding weeks, ended January 13, 1932, but the de crease was somewhat smaller than occurs in most years. Four cities reported higher figures for the later period, Asheville increasing 5/10 of 1 per cent, Richmond 3.3 per cent, Winston-Salem 17.5 per cent, and Charleston, S. C., 25.3 per cent. In comparison with debits totaling $1,072,754,000 in the four weeks ended February 11, 1931, debits in the corresponding four weeks this year showed a decline of 17.5 per cent. Only one city, Portsmouth, Va., reported a higher figure for the 1932 period, and this gain was less than 1 per cent. The five largest cities reported declines in debits for the 3 current period as follows: Baltimore, 21.3 per cent; Washington, 11.2 per cent; Richmond, 8.8 per cen t; Norfolk, 18.4 per cen t; and Charlotte, 9.7 per cent. Commercial Failures Business failures tend to increase in January, be cause of the pressure of year-end settlements, and in the Fifth district this year there was a moderate rise in the number of insolvencies in comparison with December 1931. The January 1932 record, however, was the best in both number of failures and in total liabilities involved reported in any other January in several years. There were 159 bankruptcies in the Fifth district last month, com pared with 140 in December 1931 and 203 in January 1931. Not since 1924 has a lower number of failures been reported for January. Liabilities last month totaled $2,404,390, a lower figure than either $4,301,830 for December or $4,339,019 for January 1931. Last month's liabilities were the lowest for any January since 1929, and with the exception of that month, were the lowest for any January since 1920. Employment Employment conditions in the Fifth reserve dis trict showed no improvement in the first six weeks of 1932, but unusually mild weather lessened the hardships of those persons who are out of work. The winter temperature has been so moderate that fuel and heavy clothing costs have been relatively low, thus allowing a larger proportion of reduced incomes to go for food, housing and other necessary expenses. Unemployment is widespread among all classes of workers, probably being more extensive in building trades and industrial groups than in other fields. There is less unemployment in to bacco and textile fields than in others, although many textile workers are working on reduced time schedules. Coal Production Bituminous coal production in the United States totaled approximately 27,892,000 net tons in Janu ary 1932, in comparison with 30,260,000 tons in De cember and 38,542,000 tons in January 1931. Total production during the present coal year to Febru ary 6 (approximately 262 working days) amounts to 309,419,000 net tons, a much smaller figure than for any other recent year. Shipments of coal through Hampton Roads this calendar year, through February 6, totaled 2,187,000 net tons, com pared with 2,535,147 tons shipped to the same date in 1931 and 3,008,029 tons in 1930. In its February 6 report, the Bureau of Mines, Department of Commerce, gave annual production figures of soft coal by states for the past year. In 1931 W est Virginia mined 99,769,000 net tons, lead ing all states. Virginia produced 9,650,000 tons, 4 MONTHLY REVIEW and Maryland dug 1,950,000 tons. Total production in 1931 in the Fifth district was 111,369,000 net tons, or 29.5 per cent of National production totaling 378,110,000 tons. Last year’s percentage of total production was higher in the Fifth district than the percentage for 1930, which was 28.9 per cent. Textiles Cotton yarn, cloth and knitting mills in the Fifth reserve district continued operations in January at about the same rate as in other recent months. Forward orders are very scarce, but there is a steady offering of small orders for immediate ship ment. Cotton consumed in the district in January totaled 213,891 bales, of which North Carolina mills used 107,292 bales, South Carolina mills used 95,037 bales, and Virginia mills 11,562 bales. In December 1931 the mills in the Carolinas and Virginia con sumed 198,076 bales, and in January 1931 they used 207,320 bales. Consumption of cotton in the Rich mond reserve district in January 1932 totaled 49.13 per cent of National consumption, compared with 47.7 per cent in December 1931 and 46.06 per cent in January 1931. Cotton Statistics Spot cotton prices between January 15 and Febru ary 12 on ten Southern markets held the gain reg istered in the second week of January, but did not advance further. As reported in this Review last month, the average price for % inch staple, mid dling grade, upland cotton was 6.25 cents per pound on January 15, from which it rose to 6.26 cents on January 29 and then dropped to 6.23 cents on Feb ruary 12, the latest date for which official figures are available. Cotton consumption in American mills in January 1932 totaled 435,337 bales, according to the report of the Bureau of the Census made public on January 13. This figure shows a seasonal increase over 415,517 bales consumed during the month of De cember 1931, but is 3.3 per cent less than 450,117 bales consumed in January 1931. Total consump tion during the six months of the present cotton year amounted to 2,631,272 bales, compared with 2,460,250 bales consumed during the six months ended January 31, 1931. Cotton on hand at manu facturing establishments on January 31, 1932, totaled 1,637,139 bales, compared with 1,630,543 bales held on December 31,1931, and 1,617,840 bales held on January 31, 1931. Bales in public ware houses and compresses numbered 10,032,322 at the end of January, against 10,425,945 bales at the end of December, and 7,938,817 bales on January 31, 1931. Exports of cotton totaled 919,338 bales in January, compared with 1,181,089 bales sent abroad in December 1931 and 532,821 bales in January 1931. Imports last month totaled 12,718 bales, compared with 12,705 bales imported in December and 11,299 bales in January 1931. Consumption of cotton in the cotton growing states totaled 358,527 bales in January, compared with 355,419 bales used in Janu ary 1931. Last month’s consumption in the cotton growing states amounted to 82.36 per cent of Na tional consumption, compared with 78.96 per cent of National consumption used in the cotton grow ing states in January a year ago. Of the 358,527 bales consumed in the cotton growing states last month, Fifth district states used 213,891 bales, or 59.66 per cent, compared with 57.6 per cent in Janu ary 1931 and 58.0 per cent in January 1930. Tobacco Marketing Virginia tobacco markets sold 28,297,635 pounds of producers’ tobacco in January 1932, at an aver age price of $5.76 per hundred pounds, according to warehouse reports to the Commissioner of Agricul ture. Total sales for the season to January 31 were 91,200,096 pounds, and the average season price was $6.91 per hundred, compared with 110,086,498 pounds sold at an average of $9.32 per hundred prior to January 31, 1931. Nearly 75 per cent of the estimated sales for the season had been sold by January 31, compared with 83.4 per cent sold to the same date last year and 88.8 per cent two years ago. January sales of flue-cured tobacco amounted to 12,814,401 pounds, at an average price of $5.57 per hundred, and sales for January 1931 amounted to 19,332,275 pounds at an average of $6.35 per hun dred pounds. Danville led the flue-cured markets in January in both the number of pounds sold, 6,459,991, and in average price paid, $6.32 per hun dred pounds. Fire-cured sales were much larger than for any other January in recent years, the total amounting to 9,704,373 pounds at an average price of $4.81 per hundred pounds. The January price was slightly better thaji the December aver age of $4.67, but was much lower than the January 1931 average of $9.29 and the January 1930 aver age of $18.13. Lynchburg with 2,920,055 pounds led the fire-cured markets in sales in January, but Blackstone with an average of $5.73 per hundred paid the highest price. Sales of Burley tobacco were larger in January than in December and the total amounted to 4,427,873 pounds at an average price of $8.47 per hundred pounds. The average price was somewhat lower than the December aver age of $10.18 and was more than 50 per cent below the January 1931 average of $17.57. Practically all of the Burley tobacco was sold on the Abingdon market. Sun-cured sales increased considerably during January and the total amounted to 1,350,988 pounds, at an average price of $5.62 per hundred. Sales for January 1931 amounted to 835,477 pounds, at an average price of $8.16 per hundred. All suncured tobacco was sold at Richmond. According to estimates of warehousemen, the grades in January 1932 averaged 14 per cent good, 32 per cent medium, and 54 per cent common, compared with January 1931 grades of 10 per cent good, 26 per cent medium, and 64 per cent common. MONTHLY REVIEW North Carolina auction markets sold 35,145,640 pounds of tobacco for growers in January, at an average price of $6.13 per hundred pounds, com pared with 49,097,523 pounds sold for an average of $10.66 per hundred in January 1931. Total sales this season, to February 1, amounted to 458,129,286 pounds, compared with 541,114,488 pounds sold prior to February 1, 1931. Winston-Salem sold 6,795,889 pounds in January 1932, leading all markets, while Oxford with sales of 3,577,936 pounds and Wilson with 3,475,132 pounds ranked second and third, re spectively. In average price paid, Asheville led with $9.07 per hundred, but the tobacco sold in Asheville was Burley and was not representative of the State's crop. Among the flue-cured markets, Durham led in price with $7.88, Mebane and Oxford tying for second place with an average of $7.27 per hundred pounds. The North Carolina Agricultural Statistician states that sales this year do not re flect actual production. A considerable amount of tobacco offered for sale received no offer from buy ers, and was returned to the farms to be used as bedding and fertilizer. Tobaccos of this type sold in 1931 at from 1 to 5 cents per pound, but was en tirely unsalable this season. Tobacco Manufacturing The Internal Revenue Bureau of the Treasury Department issued a report on February 1 on taxes collected by the United States on tobacco manu facturing in 1931. Total taxes collected on all to bacco products amounted to $422,939,143, and of this sum, $330,315,141, or 79 per cent, was paid in the Fifth Federal reserve district, chiefly in North Carolina and Virginia. In comparison with taxes paid to the United States in 1930, those for the country as a whole declined 4.8 per cent in 1931, but the taxes paid last year in the Fifth district de clined only 3.9 per cent. Taxes on cigarettes paid to the United States in 1931 totaled $340,397^)45, of which the Fifth district paid $299,976,581, or 88.1 per cent. On cigars, the Government collected $16,389,165 last year, of which the Fifth district paid only $1,084,608, or 6.6 per cent. Manufactured to bacco, including chewing tobacco, smoking mix tures and snuff, brought in a total to the Treasury of $66,152,934, of which the Fifth district paid $29,254,952, or 44.2 per cent. North Carolina was far in the lead in cigarette production with tax payments totaling $215,841,193, Virginia ranking second with payments totaling $84,135,220. North Carolina also led in taxes paid on manufactured tobacco, with $23,459,435, but Ohio ranked second with $9,203,614. The actual number of cigarettes produced in 1931 in the United States was 113,465,680,000, of which the Fifth district made 99,992,193,000. North Caro lina manufactured 71,947,063,(X ) cigarettes in 1931, X and Virginia produced 28,045,073,000 cigarettes. Vir ginia and South Carolina paid more tobacco taxes in 1931 than in 1930, and North Carolina paid more taxes on smoking and chewing tobacco last year. 5 Agricultural Notes Little work is done on farms in January and early February, but this winter has been the mildest one for many years and more outside work has been possible than in most seasons. W inter grains have had little or no snow cover, but neither have there been any severe ice storms or freezes, and growing crops are consequently in good condition. Rains have been frequent enough to supply all the mois ture needed by vegetation, and the mild tempera tures have advanced growth much beyond the normal point for this season of the year. There is danger that fruits may advance too rapidly and be damaged by frosts or freezes later in the spring. Indications are th at acreage will be reduced in nearly all crops this year, partly because of un favorable prices for agricuttural products and part ly because of inability of the farmers to finance their usual acreage. Building Operations for the Months of January 1932 and 1931. CITIES Baltimore, Md.------Cumberland, Md.---Frederick, Md-------Hagerstown, Md__ Salisbury, Md.----Danville, Va.....---Lynchburg, Va----Norfolk, Va........... Petersburg, Va.___ Portsmouth, Va.._ Richmond, Va.-----Roanoke, Va.____ Bluefieldf, W. Va___ Charleston, W. Va.... Clarksburg, W. Va.. Huntington, W. Va... Asheville,, N. C _ :. _ Charlotte, N. C___ Durham, N. C.____ Greensboro, (N. C-... High Point, N. C._ Raleigh, N. C._____ Rocky Mount, N. C... Salisbury, N. C.___ Wilmtngton, N. C_ Winston-Salem, N. C Charleston, S. C __ Columbia, S. C.---Greenville, S. C.__ Rock Hill, S. C.__ Spartanburg, S. C.... Washington, D. C.... District Totals__ Permits Issued 1931 1932 879 14 11 10 31 9 24 98 878 5 17 7 32 2 86 31 77 9 34 98 11 5 30 13 2 23 22 4 33 11 Total Valuation 1932 1931 964,200 17,871 19,629 11,855 20,425 3,116 182,365 101,832 450 21,840 75,668 31,580 1,020 9 722 357 15,610 2,515 5,253 4,470 45,631 3,550 8,087 4,450 1,895 850 5,200 39,000 21,628 12,323 17,738 19,350 1,850 9,852 1,304,725 2,289 1,930 $2,975,828 17 13 43 6 22 5 13 3 3 12 42 33 62 19 8 11 9 59 15 26 9 15 5 1 19 35 29 30 29 11 21 $1,354,920 8,175 10,583 4,605 27,050 150 137,958 92,950 28,640 33,739 181,485 13,125 690 43,866 286,020 21,270 1,825 67,007 53,430 11,495 4,680 6,351 2,090 275 20,900 43,215 30,048 323,875 15,575 9,120 13,043 1,816,700 $4,664,855 Building Permits issued by inspectors in thirty-two leading cities of the Fifth Federal reserve district in January 1932 number 2,289, a higher number than 1,930 permits issued in January 1931, but the aver age amount of each permit issued last month was much less than the average in the same month last year. Total valuation figures for the permits issued in January this year amounting to $2,975,828 6 MONTHLY REVIEW showed a decline of 36.2 per cent under permits totaling $4,664,855 issued in January 1931, last month’s figure being the smallest total reported for any month in the past ten years. All of the larger cities except Norfolk reported lower 1932 figures, but it is of interest to note that twelve of the thirty-tw o cities showed higher figures last month. Contracts awarded in January for construction work in the Fifth reserve district totaled $5,615,205, including both urban and rural construction, com pared with $21,534,475 for contracts awarded in January 1931, according to figures collected by the F. W. Dodge Corporation. Of the January 1932 total, $2,745,005 represented contracts for residen tial types of construction, compared with $4,493,725 in contracts awarded for residential building in January last year, a smaller amount this year but a much larger percentage of total awards. Retail Trade, 34 Department Stares Richmond Baltimore Washington Other Cities District January 1932 sales, compared with sales in January 1931: —22.1 —19.7 —16.3 —22.1 —18.9 Jan. 31, 1932, stocks, compared with stocks on Jan. 31, 1931: —12.2 —11.0 — 6.8 —17.5 —10.4 Jan. 31, 1932, stocks, compared with stocks on Dec. 31, 1931: — 8.9 —10.8 — 5.2 — 8.2 — 8.2 Number of times stock was turned in January 1932: 248 259 .263 .182 .250 Percentage of Jan. 1, 1932, receivables collected in January: 302 25.3 31.7 27.8 28.3 Sales in thirty-four department stores in the Fifth district in January made the most unfavor able comparison with sales in the corresponding month of the preceding year that has occurred in a number of years. P art of the decline this year is due to lower prices, and part to exceptionally unseasonable weather for winter trade. Stocks on the shelves of the reporting stores declined an average of 8.2 per cent in January, a seasonal reduction, and at the end of the month averaged 10.4 per cent less than stocks on hand a year earlier. Probably most of the decline in stocks during the year is accounted for by price re ductions. Collections in January averaged 28.3 per cent of receivables outstanding at the beginning of the month, a lower percentage than 30.0 per cent col lected in January 1931. Wholesale Trade, 63 Firms 22" 9 Groceries Dry Goods 6 Shoes 14 Hardware 12 Drugs January 1932 sales, compared with sales in January 1931: —17.6 —24.4 — 4.1 —18.5 —26.0 January 1932 sales, compared with sales in December 1931: — 8.6 —10.0 +32.3 + 12 — .7 Jan. 31, 1932, stocks, compared with stocks on Jan. 31, 1931: _____ —17.7(8^) —24.3(4*) —17.7(5*) —14.7(7*) Jan. 31, 1932, stocks, compared with stocks on Dec. 31, 1931: + 1.7(8*) +19.5(4*) +13.9(5*) + 3.0(7*) _____ Percentage of Jan. 1, 1932, receivables collected in January: 53.6(12*) 30.2(5*) 29.9(6*) 27.4(11*) 50.3(8*) * Number of reporting firms. Wholesale trade in the Richmond Federal re serve district was seasonally better in shoes and hardware than in December, but was slower in groceries, dry goods and drugs, and compared un favorably with January 1931 trade in all five lines. Stocks increased seasonally during January and at the end of the month were larger in all four lines for which figures are available than at the end of December, but all lines showed lower stock figures than at the end of January 1931. January collections of receivables outstanding on the first of that month were slower in all lines reported upon than collections in January last year, but the decrease was not large in any line. (Compiled February 20, 1932) MONTHLY REVIEW 7 BUSINESS CONDITIONS IN THE UNITED STATES (Compiled by the Federal Reserve Board) In January production of manufactures increased by about the usual seasonal amount, while output of min erals and value of building contracts awarded continued to decline. Wholesale prices declined further during January and early February, but more recently prices of certain leading commodities showed an advance. Production and Employment Volume of industrial production, which includes both manufactures and minerals, increased from December to January by an amount somewhat smaller than is usual at this time of year, and the Board’s seasonally adjusted index declined from 71 per cent of the 19231925 average to 70 per cent. In the steel industry there was a seasonal increase in activity during January, fol lowed by a slight decline during the first three weeks of February. Production of automobiles, which usually increases considerably at this season, showed little change in January, following an increase in December. Activity at textile mills increased by more than the usual seasonal amount and at shoe factories there was a seasonal increase in production. Output of coal and petroleum was substantially reduced. Volume of fac tory employment declined by more than the usual sea sonal amount between the middle of December and the middle of January. Number employed at foundries, car building shops, clothing factories, and establish ments producing building materials declined substan tially, while employment in the tobacco industry de creased less than is usual at this season, and employ ment in the woolen goods industry increased, contrary to seasonal tendency. Total value of building con tracts awarded in 37 Eastern states, as reported by the F. W. Dodge Corporation, declined sharply in Janu ary, and for the three months period ending in that month was about one-half of the amount awarded in the corresponding period a year ago. Approximately one fourth of the decrease was in residential building, and three fourths in other types of construction. Distribution Total freight car loadings decreased in January, con trary to seasonal tendency, reflecting chiefly smaller shipments of merchandise, miscellaneous freight, and coal. Department store sales declined by about the usual seasonal amount. W holesale Prices The general level of wholesale commodity prices, as measured by the index of the Bureau of Labor Sta tistics, declined 2 per cent further from December to January, although prices of some important commodi ties, such as wheat, showed little change and the price of cotton advanced. During early February prices of certain leading commodities, including grains and cot ton, declined, but later in the month there was some advance in the price of these commodities. Bank Credit Volume of reserve bank credit outstanding declined in January and the first half of February. This de crease has reflected a return flow of currency from cir culation, which has been smaller than usual this year, together with a continued reduction in member bank reserve balances, offset in part by a demand for reserve bank credit caused by an outward movement of gold amounting to $100,000,000 since the turn of the year. A decline in money in circulation after the first few days in February reflected some return of hoarded cur rency accompanying a decrease in bank failures. At member banks in leading cities volume of credit con tinued to decline during January and the first half of February. Between January 13 and February 17, total loans and investments decreased by $550,000,000, rep resenting declines in loans on securities, in other loans and in investments. Deposits of these banks also de clined substantially during this period. Money rates in the open market showed little change. On February 26 the discount rate of the Federal Reserve Bank of New York was reduced from 3y* to 3 per cent, and buying rates on bankers' acceptances of short maturi ties were reduced from 2% to 2% per cent.