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MONTHLY REVIEW CREDIT, BUSINESS AND AGRICULTURAL CONDITIONS WILLIAM W. HOXTON, C h a ir m a n a n d F e d e r a l R e s e r v e A g e n t FEDERAL RESERVE BANK OF RICHMOND RICHMOND, VIRGINIA JULY 31, 1932 failures in the Fifth district in June EVELOPMENTS of the past FIFTH FEDERAL RESERVE DISTRICT were more numerous than in June, month in business in the Fifth 1931, and liabilities involved in the Federal reserve district were chiefly seasonal. The period between the mid failures increased even more than the dle of June and the middle of July is number of insolvencies. The district comparison with the failure record of normally dull, and this year was no June 1931 was materially worse than exception to the rule. Rediscounts for the comparison of figures for the member banks at the Federal Reserve Bank of Richmond rose between June United States as a whole in both num 15 and July 15, and on the latter date ber of bankruptcies and in aggregate were materially higher than the dis libailities involved. Employment con ditions showed contrasting tendencies counts held a year earlier. The Bank's portfolio of Government securities re last month, some additional workers mained unchanged during the past being taken on by a few industrial month, but at the middle of July was plants, while other plants curtailed op erations further, and construction work about 50 per cent higher than on July continued to decline. Coal production 15, 1931. Total earning assets of the Richmond bank rose between June 15 and July 15, and in June continued at a level far below the low level of were about 55 per cent higher on the latter date than last year. Textile mills restricted operations further on July 15 last year. There was an unseasonal in in June, some mills closing for several weeks, but there crease in the circulation of Federal reserve notes last has been some increase in operations in July and most month, and the amount in actual circulation was much of the mills which closed last month are now running larger than the amount in circulation at the same time part time. Nearly all textile mills are working on last year. Regularly reporting member banks in the materially restricted schedules, to prevent accumulation district's leading cities reduced their loans between of goods in their warehouses. Cotton prices rose ap June 15 and July 13, and also slightly reduced their in proximately a cent a pound last month, but are still vestments in bonds and securities. Demand deposits much lower than prices at this time last year. Official declined durng the month under review, but there was acreage figures for this year's cotton crop show a re a moderate rise in time deposits. The reporting banks duction of 9.5 per cent for the country as a whole, but reduced their reserve balances at the reserve bank this reduction appears inadequate to overcome the more than the decrease in deposits accounted for, and effects on prices of the large surplus stock of cotton on increased their borrowing at the reserve bank to some hand to be carried over in to the new cotton year. extent. Debits to individual accounts figures for the Construction work provided for in permits issued and four weeks ended July 13, 1932, showed a seasonal contracts awarded in June was much lower than the increase over debits for the preceding four weeks, small amount of work provided for in June last year. -ended June 15, 1932, but the increase was somewhat Retail trade in June as reflected in department store smaller than occurs in most years. In comparison with sales showed a decrease of 22.8 per cent in comparison debits for the four weeks ended July 15, 1931, those with June trade last year, and wholesale trade last for the corresponding four weeks this year showed a month in five lines was also in materially less volume decline of 24.6 per cent, not one of the twenty-four than in June 1931. Agricultural developments in June cities showing higher 1932 figures. Total debits in and the first half of July were favorable on the whole, twenty-four cities for the first half of 1932 were 21 but prospects for yields of most crops are poorer than per cent less than debits in the first half of 1931, every a year ago, and the price situation is also fess favorable city reporting lower figures this year. Commercial at the present time. Acreage planted in money crops MONTHLY REVIEW 2 are lower this year, and in the case of tobacco the acreage reduction has been so large that some bene ficial effects may be brought about in tobacco prices next fall. Farmers used less fertilizer this year than in any other recent year, and in every way the growers are making the 1932 crops as cheaply as possible. Reserve Bank Statement ITEMS July 15 1932 Rediscounts held ---------------Open market paper------------Government securities ---------Other earning assets-----------Total earning assets............. Circulation of Fed. Res. notes.... Members’ reserve deposits-----Cash reserves -------------------Reserve ratio _____________ $29,957 3,659 47,133 0 80,749 91,918 50,487 79,768 51.27 000 omittec June 15 July 15 1932 1931 $24,537 3,787 47,133 0 75,457 88,324 61,209 84,656 55.55 $17*235 3,160 31,558 220 52,173 68,970 62,211 90,222 66.49 The figures in the accompanying table show the principal items on the Federal Reserve Bank of Rich mond's statement of condition as of July 15, 1932, in comparison with corresponding figures a month and a year earlier. The volume of rediscounts for member banks held by this Bank on July 15, 1932, was more by $5,420,000 than rediscounts held on June 15 this year and also showed an increase of $12,722,000 above the July 15, 1931, figure. An increase in rediscounts at midsummer is contrary to the course of borrowing at the reserve bank during the past two years, but is in line with the seasonal trend developed in earlier years. There was a slight decrease of $128,000 in open mar ket paper in the Bank's portfolio last month, but the amount held on July 15 was $499,000 above the hold ings on July 15 last year. No change occurred in the Bank's holdings of Government securities between June 15 and July 15, but on the later date totaled $15,575,000 more than Government securities held on July 15, 1931. These securities were acquired through par ticipation in System purchases on the open market. The changes in the several items resulted in a net in crease of $5,292,000 in total earning assets between June 15 and July 15, and there was an increase of $28,576,000 in the Bank's earning assets during the past year. An unusual expansion of Federal reserve notes in actual circulation occurred last month, the in crease amounting to $3,594,000, and on July 15, 1932, the volume of notes in actual circulation exceeded the notes of July 15, 1931, by $22,948,000. Between June 15 and July 15, member bank reserve deposits at the Federal Reserve Bank of Richmond declined by $10,722,000, there having been an unusual and temporary increase in June, and the year showed a decrease of $11,724,000, the latter decline being due to lower de posits in member banks this year. The cash reserves of the Richmond reserve bank declined $4,888,000 during the past month, and on July 15 were $10,454,000 less than reserves a year earlier. Corresponding declines also occurred in the ratios of cash reserves to note and deposit liabilities combined, this ratio falling 4.28 points last month and 15.22 points during the year. Member Bank Statement ITEMS July 13 1932 ooo omitted June 15 July 15 1932 1931 Loans on stocks and bonds (in cluding Governments) ....... $123,485 $123,955 $156,157 All other loans____________ 204,210 211,632 251,029 Total loans and discounts 327,695 335,587 407,186 Investment in stocks and bonds 247,200 247,689 225,623 40,794 44,282 Reserve bal. with F. R. Bank.... 34,665 13,346 Cash in vaults_____________ 11,915 12,840 Demand deposits __________ 277,071 288,403 335,436 Time deposits ____________ 229,315 226,282 267,209 2,565 Borrowed from F. R. Bank. 7,208 6,315 The accompanying table shows the principal items of condition reported by all member banks in twelve leading cities of the Fifth reserve district as of three dates, July 13 and June 15, 1932, and July 15, 1931, thus affording opportunity for comparison of the latest available figures with those of the preceding month this year and the corresponding month last year. Forty-nine banks are included in the tabulation. Between June 15 and July 13, both this year, total loans and discounts in the reporting banks declined by $7,892,000, of which $7,422,000 was in “All other loans," which are chieflly commercial, industrial or agricultural in character. Investments in bonds and other securities decreased $9,617,000 during the month, and the reporting banks also decreased their reserve deposits at the Federal Reserve Bank of Richmond by $9,617,000. Cash in vaults rose by $925,000 between June 15 and July 13. There was a decline of $11,332,000 in demand deposits last month in the forty-nine reporting banks, but time deposits rose by $3,033,000 leaving a net decrease in deposits amounting to $8,299,000, most of which was due to the decrease in loans and discounts. The reporting banks increased their borrowing at the reserve bank by $893,000 between the middle of June and the middle of July. Comparison of the July 13, 1932, condition figures with those for July 15, 1931, shows marked changes in several items during the year. Loans on stocks and bonds declined by $32,672,000, and “All other loans" decreased by $46,819,000, a total decrease in loans and discounts amounting to $79,491,000, approximately 20 per cent of total loans a year ago. This drop in loans was naturally accompanied by a decline in deposits, de mand deposits decreasing $58,365,000 and time deposits falling $37,894,000, a total of $96,259,000, or 16 per cent of aggregate deposits on July 15, 1931. Lower deposits brought a corresponding decline in reserve bal ances carried by the reporting banks at the reserve bank, this item declining $6,129,000 during the year. Cash in vaults also dropped $506,000 between July 15, 1931, and July 13, 1932. The forty-nine banks increased their investments in bonds and securities by $21,577,000 during the year under review, and also increased their borrowing at the Federal Reserve Bank of Richmond by $4,643,000. 3 MONTHLY REVIEW Time and Savings Deposits Time deposits in forty-nine regularly reporting mem ber banks and aggregate deposits in twelve mutual sav ings banks in Baltimore totaled $442,717,818 at the end of June 1932, an increase over time and savings de posits totaling $439,403,447 at the end of May this year, but materially less than $477,133,547 in deposits at the end of June last year. DEBITS TO INDIVIDUAL ACCOUNTS CITIES 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, Va....................... Spartanburg, S. C._______ Washington, D. C_______ Wilmington, N. C______ Winston-Salem, N. C.____ District Totals Total Debits During the Four Weeks Ended’ July 15, 1931 July 13, 1932 June 15, 1932 $ 6.541.000 259,227,000 8.671.000 30.497.000 28.585.000 12.336.000 6.985.000 4.482.000 12.127.000 9.847.000 7.769.000 6.332.000 9.738.000 11.659.000 6.394.000 33.850.000 3.231.000 14.543.000 106.738.000 16.790.000 4.980.000 195.842.000 6.508.000 25.702.000 $ 829,374,000 $ 6,900,000 244,559,000 10.158.000 27.935.000 29.254.000 11.342.000 4.771.000 3.923.000 13.788.000 8.958.000 7.269.000 5.049.000 9.568.000 11.358.000 7.094.000 32.925.000 3.189.000 11.882.000 89.859.000 16.347.000 5.010.000 177,531,000 6.910.000 21.152.000 $ 766,731,000 The accompanying table of debits to individual ac counts shows aggregate figures for all checks drawn against depositors’ accounts in the banks of twentyfour cities of the Fifth reserve dstrict during three equal periods of four weeks, ended July 13, 1932, June 15, 1932, and July 15, 1931. In addition, the table also shows figures for the half-year ended June 30, 1932, with comparative figures for the first half of 1931. During the four weeks ended July 13, 1932, aggre gate debits to individual accounts in the twenty-four reporting cities totaled $829,374,000, an increase of $62,643,000, or 8.2 per cent, over debits totaling $766,731,000 during the preceding four weeks, ended June 15, 1932. This increase was seasonal, and was caused chiefly by quarterly and semi-annual payments on and around July 1. The rise during the later period was somewhat larger than the rise for the corresponding period last year, but was rather less than occurs in most years. Seventeen of the twenty-four cities reported higher figures for the four weeks ended July 13, while seven cities failed to register the usual gain. A comparison of the figures for the four weeks ended July 13, 1932, with corresponding figures for the four weeks ended July 15, 1931, shows a general decline averaging 24.6 per cent, every one of the re porting cities sharing in the decline in debits this year. Total debits in the first half of 1932 amounted to $5,481,511,000 in the twenty-four reporting Fifth dis trict cities, compared with debits aggregating $6,972,- Semi-Annual Totals 1932 1931 10,325,000 353,769,000 19.562.000 35.847.000 39.591.000 21.242.000 8.959.000 7.345.000 26.394.000 15.815.000 14.508.000 8.535.000 14.776.000 18.696.000 9.674.000 45.437.000 4.519.000 23.734.000 117.385.000 24.228.000 8.573.000 228,600,000 10.849.000 31.692.000 $ 52,989,000 1.743.860.000 68.827.000 188.723.000 211.652.000 93.811.000 35.411.000 29.463.000 89.894.000 63.855.000 64.963.000 36.104.000 69.750.000 79.136.000 47.130.000 220.353.000 22.375.000 90.387.000 653.944.000 123.507.000 40.061.000 1.236.015.000 49.457.000 169.844.000 $ 70,626,000 2.272.463.000 109.638.000 237.655.000 259.904.000 141.863.000 47.210.000 38.329.000 143.300.000 112.317.000 96.632.000 51.213.000 101.330.000 102.415.000 64.619.000 292.707.000 27.311.000 120.007.000 743.073.000 158.384.000 58.280.000 1.443.395.000 73.096.000 206.505.000 $1,100,055,000 $5,481,511,000 $6,972,272,000 $ 272,000 in the first half of 1931, a decline of $1,490,761,000, or 21 per cent, this year. In comparison with semi-annual debits in other years, totals for 1932 were the lowest for any year since this Bank began tabu lating debits figures in 1924, and were 34 per cent be low the total for the first half of 1929, the highest year on the reserve bank’s record. Every one of the twentyfour reporting cities show lower debits figures for the past six months than for the corresponding six months of 1931. Commercial Failures The business failure record of the Fifth Federal re serve district in June in comparison with June 1931 was worse than the average for the United States. Bankruptcies numbering 179 were reported in the dis trict last month, compared with 112 bankruptcies in June last year, an increase of 59.8 per cent. The National increase was only 34.9 per cent. In aggregate liabilities involved in the failures, the Fifth district with $6,996,072 showed an increase of 192.3 per cent over liabilities totaling $2,393,591 reported in June 1931. The National increase in liabilities last month was 48.9 per cent. The Atlanta, St. Louis and San Francisco districts reported fewer failures and lower liabilities in June 1932 than in June 1931, and the Cleveland district reported lower liabilities, but the other districts reported more failures and greater liabil ities. 4 MONTHLY REVIEW Insolvencies in the Fifth reserve district in the first half of 1932 numbered 1,028, compared with 948 in solvencies in the first half of 1931, an increase of only 8.4 per cent, but the aggregate liabilities involved in the 1932 failures totaled $34,231,681, an increase of 71.3 per cent over liabilities totaling $19,986,263 in volved in failures in the January-June figures last year. The continued depression seems to be reaching larger firms than those first affected when the slump began, and these larger failures naturally swell the liability total. Employment Employment conditions in the Fifth reserve district show no improvement, but on the contrary appear to have grown slowly worse. A few industrial plants are speeding up operations to some extent after the vaca tion and inventory period, but the workers taken on are in most cases people who have been idle only a few weeks, and there as yet is no relief in sight for workers who have been out of work many months. Building tradesmen continue almost entirely idle, and unless the new relief bill passed by Congress speeds up road work and other governmental projects there is no build ing revival in sight at present. Textile mills are oper ating on about half time, and coal production is at very low level. Exhaustion of savings by the unemployed is increasing the, need for help from public and private funds, and unless there is material improvement in employment before next winter the relief problem will be quite serious in many towns and cities. Coal Production Total production of bituminous coal in the United States in June 1932 amounted to 17,712,000 net tons, compared with 18,384,000 tons mined in May 1932 and 29,185,000 tons in June last year. Daily average production in June this year of 681,000 tons compared with an average of 727,000 tons in May 1932 and 1,123,000 tons in June 1931. Total production of soft coal during the present calendar year to July 9 amount ed to 149,182,000 net tons, the lowest figure for the corresponding period of recent years. Tidewater ship ments of coal through Hampton Roads totaled 9,030,009 tons during the first half of this year, compared with 10,820,790 tons shipped in the corresponding period in 1931. The June 25 report of the Bureau of Mines, Depart ment of Commerce, gave coal production figures by states for the month of May 1932. West Virginia with 6,115,000 tons was in first place, Pennsylvania ranking second with 5,407,000 tons. The states of West Virginia, Virginia and Maryland mined a total of 6,740,000 tons of bituminous coal in May, 36.7 per cent of total National production. Textiles A considerable number of textile mills in the Fifth reserve district were closed a part of June for vaca tion, to overhaul machinery, or to prevent the accumu lation of manufactured goods, and consequently cotton consumption declined sharply last month. Fifth dis trict mills consumed only 144,892 bales last month, compared with 158,464 bales used in May 1932 and 204,769 bales in June 1931. Last month North Caro lina mills used 77,752 bales, South Carolina mills used 61,182 bales, and Virginia mills used 6,958 bales. June 1932 consumption in Virginia and the Carolinas was 45.2 per cent of National consumption, a lower per centage than 47.7 per cent of National consumption in May 1932 but slightly higher than 45.1 per cent in June 1931. On June 21, the Department of Commerce issued a report on spindles in place, spindles active in May, total spindle hours of operation in May, and average hours of operation per spindle in place in May. On May 31, 1932, there were 31,737,174 spin dles in place in the United States, North Carolina lead ing with 6,193,474, or 19.5 per cent of the total, Massa chusetts ranking second with 6,168,048 spindles, or 19.4 per cent, and South Carolina third with 5,687,944 spindles, or 17.9 per cent. The Fifth district as a whole had 39.6 per cent of total spindles in place in the United States at the end of May 1932. In actual spindle hours of operation, South Carolina led all states for May with 1,265,480,511 hours, or 27.6 per cent of the National total of 4,577,485,125 hours, and North Carolina ranked second with 1,008,174,324 hours, or 22.0 per cent, while Massachusetts had only 349,417,637 hours, or 7.6 per cent. The Fifth district, with 39.6 per cent of total spindles in the United States in place in May, showed 52.4 per cent of total hours of operation. In actual hours of operation per spindle in place, the Fifth district states did not compare quite so favorably with others, South Carolina with an aver age of 222 hours of operation per spindle ranking third, Virginia with 184 hours ranking fifth, and North Carolna with 163 hours ranking sixth. The average hours of operation for the United States was 144, consider ably lower than the average in any Fifth district state. Cotton Statistics Spot cotton prices ruled slightly higher during the past month than in the preceding one. In our June 30 Review we quoted the average price paid for middling inch upland cotton on ten Southern markets at 4.99 cents per pound on June 17. From that figure the average price advanced to 5.00 cents on June 24, to 5.43 cents on July 1, and to 5.73 cents on July 8, but after that date the price declined to 5.53 cents on July 15, the latest date for which official quotations are avail able. Consumption of cotton in the United States in June 1932 totaled 320,783 bales, compared with 332,439 bales used in May this year and 453,901 bales in June 1931. Total consumption for the eleven months of the present cotton year—August 1 to June 30—amount ed to 4,590,447 bales, compared with 4,812,090 bales consumed in the corresponding period of the 19301931 season. Manufacturing establishments held 1,322,793 bales on June 30, compared with 1,463,389 bales held on May 31 and 1,131,191 bales on June 30, 1931. Public warehouses and compresses held 7,154,- MONTHLY REVIEW 241 bales in storage at the end of June this year, com pared with 7,608,604 bales so held a month earlier and 4,970,584 bales on June 30 last year. June exports totaled 360,205 bales, compared with 500,871 bales sent abroad in May 1932 and 255,403 bales exported in June 1931. Exports during the eleven months of this cotton year totaled 8,258,072 bales compared with 6,500,868 bales shipped over seas during the correspond ing eleven months ended June 30,1931. Spindles active at some tmie during June numbered 20,561,914, com pared with 21,639,352 in May this year and 25,898,026 in June 1931. Cotton consumption in the cotton growing states totaled 274,687 bales in June, compared with 287,655 bales used in May and 356,674 bales in June 1931. Last month’s consumption in the cotton growing states amounted to 85.63 per cent of National consumption, a lower percentage than 86.53 per cent in May this year but higher than 78.58 per cent in June 1931. Of the 274,687 bales of cotton consumed in the cotton grow ing states in June, the Fifth district mills used 144,892 bales, or 52.75 per cent, a lower percentage than 57.22 per cent of Southern consumption attained by Fifth district mills in June last year. On July 8, the Department of Agriculture issued its first cotton acreage report of the season, and estimated the area in cultivation as 9.5 per cent less than the acreage in 1931. Every one of the cotton growing states except Missouri and Virginia decreased acreage this year. In the Fifth reserve' district, South Carolina showed a reduction of 10 per cent and North Carolina reported a reduction of 6 per cent, but Virginia, an unimportant factor in cotton production, planted 8 per centj more than last year. Heavy producing states out side the Fifth district reported the following reductions in acreage: Georgia, 14% ; Oklahoma, 11 % ; AlabamaLouisiana and Texas, 10% each; Mississippi, 8 % ; Tennessee, 5% ; and Arkansas, 3% . No official con dition figures are yet available, but on the whole the weather has been only moderately favorable for cotton development, weevils are more numerous in parts of the belt than in several years, and a great deal of cotton was planted with relatively little fertilizer. Agricultural Notes Farm crops have advanced far enough to give some indication of probable production for this year. On the whole, acreages in the Fifth district are lower for cash crops and higher for feed and food stuffs. Maryland acreage figures are about 2 per cent lower this year than in 1931. Notable decreases in the acre ages of corn, wheat, tobacco and sweet potatoes are re ported, but these are partially offset by increased acre ages of hay, barley and potatoes. The wheat crop suf fered severe losses from insects and diseases during June and the crop is now estimated at 5,890,000 bushels. Corn has not grown well this spring and prospects are for a yield per acre about two bushels below average. Tobacco was reported 10 per cent below last year’s acreage on June 1, but later reports indicate serious insect and disease injury and the acreage will probably be further reduced. A considerable proportion of the 5 tobacco crop was planted late, and in addition plants have been attacked by insects. About average yields of Irish potatoes are expected, and better than average yields of sweet potatoes. Hay crops promise an aver age production this year. A good yield of grapes is in prospect, but other fruits are spotted and production of apples, peaches and pears will all be considerably lower than last year. Virginia farmers have made some drastic readjust ments of crop acreages to the low prices of cash crops and to the necessity of producing food and feed sup plies. The acreage of such cash crops as wheat, pota toes, tobacco and peanuts has been reduced, but the acreage of some feed crops, barley and hay, has been increased. While no definite statistics of acreage plant ed to vegetables are available, there is a noticeable in crease in the number and size of farm gardens through out the state. Crop prospects on July 1 in Virginia were slightly better than on June 1, but considerably below the unusually favorable outlook on July 1 last year. During the first half of June weather conditions were too dry and cool for proper growth of crops, but general rains and hot weather after the 15th caused rapid improvement. While the growth of all cultivated crops on July 1 was more backward than usual, fields have been well cultivated and the crops are unusually clean, and generally have a good color. The dry weather in June probably caused corn, cotton, peanuts, tobacco, soybeans and cowpeas to develop good root systems. Early threshing reports indicate that the wheat crop will not yield as well as had been expected, and the crop is now estimated at 7,371,000 bushels, compared with the unusually large crop of 13,266,000 bushels harvested last year. The average production for the five years was 8,643,000 bushels. The acreage planted to corn is estimated about 2 per cent less than last year, and the stand is poor and growth backward, but the fields are well cultivated and plants have excellent color. A total production of 35,250,000 bushels is indicated by the July 1 condition, compared with last year’s large crop of 43,061,000 bushels. This year’s acreages of oats and rye are smaller than those of 1931, but the barley acreage shows an increase of about 15 per cent. A crop of 941,000 tons of hay is expected this year on an acreage 4 per cent greater than the 1931 acreage. Considerable hay was carried over from last year, so an abundant supply of hay feed is assured for this year. Pastures during June declined in all dis tricts except the Southwest, but the late June rains caused considerable improvement and there is sufficient grazing for all livestock. Produuction of Irish pota toes will be considerably less than last year as a result of a much smaller acreage planted and poor yields. The early commercial acreage was reduced nearly 25 per cent. Production of all Irish potatoes, including early commercial, is estimated to be 10,058,000 bushels, compared with 14,278,000 bushels harvested last year and the five-year average of 15,357,000 bushels. The total sweet potato acreage is estimated to be the same as last year, but there has been a slight decrease in the commercial acreage and an increase in the farm crop. The July 1 condition indicates a production of 4,750,000 6 MONTHLY REVIEW bushels, which is about the same as the crop harvested last year. Apples are expected to yield 1,752,000 bush last year. The peanut acreage planted this year is about els in 1932, only about one-third the size of last year’s 10 per cent less than the acreage harvested last year yield. and about the average of the previous five years. Low South Carolina total acreage is about 2.5 per cent prices received for last year’s crops is the reason for the reduced acreage this year. Virginia tobacco grow less than the acreage planted last year, for the second ers this year have planted the smallest acreage since year in succession acreage reduction in cash crops more 1870. Low prices, shortage of plants, and unfavorable than offsetting increases in food and feed crops. Com weather conditions caused a reduction of nearly 36 per pared with last July, cotton has been reduced in acre cent in this year’s acreage. Prospects for the crop on age 10 per cent; tobacco 35 per cent, soybeans grown July 1 were poor because growth was backward, plants alone 24 per cent, and Irish potatoes 28 per cent. were quite irregular in size as a result of considerable There is evidence of some shift in acreage from tobacco replanting, and fertilizer used under the tobacco was to cotton and from soybeans to cowpeas. The decrease reduced about 15 per cent. Fields have been well cul in total Irish potato acreage is entirely due to a marked tivated, and as the greater part of the growing season reduction in the early commercial crop, since potatoes still remains, considerable improvement may be shown grown for home use show a slight increase. Crops with later, the outcome depending largely on weather con acreage increases are corn 2 per cent, oats 3 per cent, ditions in July and August. Total production of to peanuts 6 per cent, tame hay and sorghum sirup 11 bacco in Virginia this year is forecast at 60,916,000 per cent each, rye 12 per cent, sweet potatoes 13 per pounds, compared with 97,920,000 pounds harvested cent, cowpeas grown alone 20 per cent, and wheat 40 last year and 126,860,000 pounds the average produc per cent. The average condition of field crops on July tion for the five years 1924-1928. Fruit prospects de 1 was about normal for recent years and gives promise clined during June because of a heavy drop and pro of fair to good yields. Tree fruits are unusually short, duction is expected to be lower than last year’s large peaches, apples and pears being reported as about onecrops and even lower than the five-year average. The third of a full crop, whereas the usual production is apple crop is now estimated at 9,450,000 bushels, com about two-thirds of a full crop. Small grains har pared with 21,117,000 bushels last year. No estimate vested this summer were below last year’s excellent of the commercial crop of apples as distinguished from yields but due largely to increased acreage the total outturn was about 10 per cent above the average of the the total farm crop will be made until August. years 1924-1928. The July 1 condition of the corn North Carolina crop acreages for this year are be crop indicated a production of 23,780,000 bushels, com tween 1 and 2 per cent less than last year, all crops pared with 22,994,000 bushels last year and an average considered. Cash crops have been somewhat reduced, five-year production of 20,227,000 bushels. The oat while food and feed crops have been increased. The crop is estimated at 7,974,000 bushels, which is 16 per corn crop, on an acreage 1 per cent larger, shows a cent less than the unusually good crop of 1931 but probable production of 43,808,000 bushels, which is about 9 per cent above the five-year average. The 9 per cent less than the 1931 yield. The corn crop is 1932 wheat crop yielded 703,000 bushels, only about irregular in stand and growth. Wheat acreage was in 2 per cent more than production last year although this creased 10 per cent, but the crop was not nearly as year’s acreage was 40 per cent greater. With a re good as that of 1931 and this year’s forecast of 3,515,- duction of 35 per cent in the tobacco acreage, indicated 000 bushels is 20 per cent less than last year’s. An production is only 38,400,000 pounds, which will be oat crop of 3,978,000 bushels this year is 12 per cent the smallest production in South Carolina since 1916, less than last year. The North Carolina tobacco crop when only 20,280,000 pounds were harvested. A sweet was reduced about 32 per cent this year, and the indi potato acreage 13 per cent larger than last year and cated production of 281,792,000 pounds for 1932 is favorable weather combine to indicate a crop of 4,42 per cent less than the 1931 crop. Peanut acreage 800.000 bushels for 1932, which is 51 per cent above is the same this year as last, but no forecast of prob the short crop of 1931. Hay prospects are for about able production has been made. A hay yield of 662,000 202.000 tons this year, compared with 178,000 tons cut tons is a little over 2 per cent less than the crop of and cured last year. 7 MONTHLY REVIEW Baltimore, Md........... 1,170 Cumberland, Md........ 8 Frederick, Md............ 12 Hagerstown, Md........ 12 Salisbury, Md............. 22 Danville, Va............... 23 Lynchburg, Va........... 32 Norfolk, Va............... 103 Petersburg, Va........... 2 Portsmouth, Va.......... 30 Richmond, V a._____ 113 Roanoke, Va.............. 39 Bluefield, W. Va, .. 1 Charleston, W. Va, 102 Clarksburg, W. Va..... 19 Huntington, W. Va.... 24 Asheville, N. C____ 21 Charlotte, N. C_____ 33 Durham, N. C_____ 12 Greensboro, N. C 38 High Point, N. C. 4 Raleigh, N. C........... 5 Rocky Mount, N. G... 2 Salisbury, N. C.......... 2 Wilmington, N. C.. . 11 Winston-Salem, N. C.. 45 Charleston, S. C.___ 46 Columbia, S. C____ 36♦ Greenville, S. C.____ 20 Rock Hill, S. Gr. ... 9 Spartanburg, S. C---16 Washington, D. C...... 528 Totals ................... 2,504 ♦Not included in totals. 1 CO CO CITIES Permits 1932 1i — Construction Building Permits Issued in June 1932 and 1931 1931 Total Valuation 1931 1932 1,611 $ 963,720 6,235 13 5,123 10 12,450 21 16,750 19 21,695 20 368,585 44 121,280 145 400 9 17,735 29 175,427 146 17,191 28 75 11 25,062 39 7,493 42 5,250 14 3,062 21 31,716 55 23,250 18 8,857 43 6,600 17 1,175 17 800 9 4,500 4 3,700 26 38,825 87 21,125 32 85,679st * 8,310 31 10,975 16 3,115 25 649 1,403,340 3,251 $3,333,821 $2,423,880 8,560 10,005 36,350 72,300 11,835 128,435 199,431 9,025 12,795 252,603 60,187 28,955 120,025 65,297 69,300 6,755 151,065 25,650 32,054 32,765 23,575 3,735 17,800 62,300 126,665 26,795 36^215 7,500 28,610 2,495,100 $6,585,567 Building permits issued in June in thirty-one lead ing cities of the Fifth reserve district numbered 2,504, compared with 3,251 permits issued in June 1931, and estimated valuation figures for last month totaled only $3,333,821, a decrease of 49.4 per cent under valu ation of $6,585,567 in June 1931. Only four of the thirty-one reporting cities showed higher valuation figures for June 1932. Lynchburg made the best rec ord for the month, not only reporting the largest in crease over June 1931 figures, but also reporting the highest total valuation among the thirty-one cities ex cept for Baltimore and Washington, which are of course much larger cities. Contracts actually awarded in June for construction work in the Fifth reserve district totaled only $7,784,987, compared with $23,635,727 reported for June 1931, according to figures collected by the F. W. Dodge Corporation. Of the June 1932 awards, $2,663,497 represented residential types of construction, compared with $6,730,982 for this class of work in June last year. Retail Trade, 33 Department Stores Richmond Baltimore Washington Other Cities District June 1932 sales, compared with sales in June 1931: —24.1 —24.6 —19.0 —30.8 —22.8 Total sales first half of 1932, compared with first half of 1931: —14.1 —19.9 —14.9 —25.4 —18.4 June 30, 1932 stocks, compared with stocks on June 30, 1931: — 3.3 —11.6 — 8.8 —19.4 —112 June 30, 1932 stocks, compared with stocks on May 31, 1932: — 5.3 — 1.8 — 4.2 — 4.3 — 3.1 Number of times stock was turned in June 1932: .332 .303 .33 .191 .299 Number of times stock was turned since January 1, 1932: 1.841 1.777 1.859 1.244 1.744 Percentage of June 1, 1932, receivables collected in June: 28.9 22.1 29.4 24.4 25.6 W holesale Trade, 62 Firms 22 9 Groceries Dry Goods 6 Shoes 13 Hardware 12 Drugs June 1932 sales, compared with sales in June 1931: —15.0 —32.0 —29.1 —21.7 —12.3 June 1932 sales, compared with sales in May 1932: + 6.0 —13.3 —29.6 — 5.1 + 6.4 Jan.-June 1932 sales, compared with sales in Jan.-June 1931: —15.7 —27.4 —14.5 —18.8 —162 June 30, 1932 stocks, compared with June 30, 1931 stocks : ____ — 7.0(8*) —20.1(4*) —25.6(5*) — 8.4(7*) June 30, 1932 stocks, compared with May 31, 1932 stocks: — .4(8*) —15.7(4*) -5 .7 (5 * ) — 4.8(7*) ____ Percentage of June 1, 1932, receivables collected in June: 57.5(13*) 28.4(6*) 32.5(6*) 27.7(11*) 45.8(8*) ♦Number of reporting firms. (Compiled July 21, 1932) 8 MONTHLY REVIEW BUSINESS CONDITIONS IN THE UNITED STATES (Compiled by the Federal Reserve Board) Industrial activity decreased further from May to June by somewhat more than the usual seasonal amount and there was a considerable reduction in fac tory employment and payrolls. The general level of commodity prices advanced between the middle of June and the middle of July, reflecting chieflly a rise in the prices of livestock and meats. Production and Employment Volume of industrial production, as measured by the Board’s seasonally adjusted index, declined from 60 per cent of the 1923-1925 average in May to 59 per cent in June. There were large decreases in output in the steel, coal, and meat-packing industries, while at automobile factories daily average production showed a smaller decline than is usual at this season, and at woolen mills activity increased contrary to seasonal tendency. Consumption of cotton by domestic mills showed the usual seasonal decline. W holesale Prices The level of prices in wholesale markets, after de clining steadily during May, was relatively stable early in June, and after the middle of the month there was an advance which continued through the second week in July. Prices of several leading commodities, including livestock and meats, cotton, and sugar, increased con siderably during June and the first half of July, but later showed some recession. Prices of wheat declined to unusually low levels and markets for copper and lead continued weak. Bank Credit Volume of reserve bank credit continued to increase between the middle of June and the middle of July, reflecting principally further purchases of United States Government securities by the reserve banks. In addition, member banks obtained reserve bank funds through an increase in the monetary stock of gold and a decline in deposits held with the reserve banks by At manufacturing establishments there was a fur foreign central banks. Funds released from these ther reduction of 3.6 per cent in number of employees sources were absorbed by an increase in the demand and of 7.8 per cent in earnings between the middle of for currency which also caused the member banks to May and the middle of June. Decreases in employ draw on their balances with the reserve banks and to ment were general, with the exception of the automo increase their discounts somewhat. The demand for bile and tobacco industries and of seasonally active in currency which for the period amounted to $270,000,dustries, such as vegetable and fruit canning and the 000, was caused by banking disturbances, largely in the manufacture of ice cream. The largest decreases were Chicago district, by seasonal requirements at the turn in the steel, textile, chemical and machinery industries of the month and the Fourth of July holiday, and by increased use of cash to avoid the tax on checks. and at railway repair shops. Loans and investments of reporting member Daily average value of building contracts awarded, after fluctuating widely during June, declined banks, in the as reported by the F. W. Corporation, declined in June first two weeks of July, and on July 13 totaled $18,but increased in the first half of July. 475,000,000, about $540,000,000 less than on June 1. Department of Agriculture estimates as of July 1 There was a further decline in loans, while the banks’ indicate a corn crop of 3,000,000,000 bushels, the larg investments in United States Government securities, est since 1923; a winter wheat crop of 432,000,000 after increasing substantially during the period of bushels, 45 per cent smaller than last year and 21 per Treasury financing in mid-June, declined gradually, but cent less than the five-year average; a spring wheat on July 13 were still $90,000,000 larger than six weeks crop of 305,000,000 bushels, three times as large as earlier. last year and slightly larger than the average; and a Money rates in the open-market declined further dur tobacco crop one-fifth smaller than usual. ing June and the first half of July. At the Federal Reserve Bank of New York buying rates for bankers’ Distribution acceptances maturing within 90 days were reduced from 2y2 to 1 per cent on June 24. On the same day the Volume of railroad freight traffic declined somewhat bank lowered its discount rate from 3 per cent to 2J4 further in June and value of merchandise sold by de per cent, and on the following day the rate at the Chi partment stores decreased by more than the usual sea cago bank was reduced from ZV2 per cent to 2y2 per cent. sonal amount.