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MONTHLY

REVIEW

o f Financial and Business Conditions

F ifth
Federal

Richmond *

If

yA. ^

nc.

^

_

Reserve
D is tr ic t

Federal Reserve Bank, Richmond, Va.

July 31, 1941

Summary of June Business Conditions
S O M E seasonal recession in business occurs in June

cent. In the textile field, cotton consumption by Fifth
district mills in June exceeded June 1940 consumption by
45 per cent, and shipments o f rayon yarn to domestic
consumers rose 24 per cent in the same period. Bitu­
minous coal production in the United States last month
was 33 per cent above June 1940 production. Business
failures declined in both number and liabilities from June
1940 figures. A ll o f this increased activity raised employ­
ment levels to the highest point over a period o f years,
and reduced relief rolls substantially.
Agricultural prospects are fair to good in the Fifth
district. The weather early in the season was very dry in
most o f the district, and early crops such as hay, Irish
potatoes and truck suffered severely, but general rains fell
in June and the first half o f July, and if weather is favor­
able the balance o f the season most o f the backwardness
in corn, tobacco and cotton, the three leading crops, can
be made up. W ith higher Government payments to far­
mers in prospect, and advancing price tendencies evident
for many farm products and live stock, cash returns from
farming should be relatively good in the fall, and farmers
should be in position to continue in the market for con­
sumer goods. Available estimates o f production in the
Fifth district for 1941 appear on page 4.

in most years, but on account o f forward orders in
industry and higher consumer purchasing power result­
ing chiefly from the defense program the recessions were
less than usual this year. In comparison with business a
year ago, activity in June continued far higher in all lines
of trade and industry.
Department store sales in 79 Fifth district stores in
June were 15 per cent above June 1940 sales, although
the 1941 month contained one less business day, and re­
tail sales in 41 furniture stores last month were 31 per
cent above sales in June last year. Registrations o f new
passenger automobiles also ran far ahead o f last year’s
June registrations. Wholesale trade in 195 firms in many
lines and debits to individual accounts in 25 cities, both
reflecting consumer purchasing power indirectly, rose 45
per cent and 32 per cent, respectively, in June 1941 in
comparison with June 1940.
Construction work provided for in permits issued and
contracts awarded in June 1941 was in very large volume.
Permits in 29 Fifth district cities last month rose 27 per
cent in valuation over June 1940 permits, and construc­
tion contracts awarded in the district increased 217 per

BUSINESS STATISTICS—FIFTH FEDERAL RESERVE DISTRICT

% Change
Y ear
Month

June 1941

May 1941

June 1940

Debits to individual accounts (25 cities)..
Sales, 79 department stores, 5th district....
Sales, 41 furniture stores, 5th district.........
Sales, 195 wholesale firms, 5th district.......
Registrations, new autos, 5th district.........

$1,807,218,000
$ 14,464,943
1,498,545
$
$ 14,423,000
35,804

$1,717,276,000
$ 16,590,561
$
1,630,641
$ 14,364,000
38,966

$1,367,716,000
$ 12,590,200
1,143,807
$
9,962,000
$
24,135

+ 5
— 13
— 8
+ o
— 8

+
+
+
+
+

Number of business failures, 5th district..
Liabilities in failures, 5th district................
Value of building permits, 29 cities.............
Value of contracts awarded, 5th district....
Cotton consumption, 5th district (Bales)..

$
$
$

27
152,000
13,533,100
92,503,000
391,979

37
$
281,000
$ 14,579,982
$ 100,005,000
413,387

$
$
$

47
801,000
10,664,464
29,161,000
271,127

— 27
— 46
— 7
— 8
— 5

— 43
— 81
+ 27
+217
+ 45

14.82
11.25
38,800,000
4,300,000
43,090,000

12.89
10.50
40,200,000
5,800,000
43,400,000

10.64
6.50
31,400,000
12,800,000
32,400,000

+ 15
+ 7
— 3
— 26
— 1

+
+
+
—
+

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




32
15
31
45
48

39
73
24
66
33

MONTHLY REVIEW

2
BANK ING STATISTICS

E M PLO Y M E N T

RESERVE BAN K STATEMENT ITEMS
Fifth District
000 omitted
July 15
June 15
ITEMS
1941
1941
$
0
$
108
Discounts held ........................................
852
Industrial advances .............................
818
121,486
119,663
Government securities .......................
Total earning assets .....................
$122,446
$120,481
Circulation of Fed. Res. notes .........
321,434
309,206
Member’s reserve deposits ..................
394,524
414,644
Cash reserves ........................................
713,046
678,548
Reserve ratio ..........................................
85.60
84.04

July 15
1940
158
871
122,624
$123,653
230,463
319,933
481,759
80.13

$

SELECTED ITEMS— 41 REPORTING MEMBER BANKS
Fifth District
000 omitted
ITEMS
July 9
June 11
1941
1941
$148,400
Loans to business & agriculture........
$144,502
161,278
All other loans ..........................................
167,030
453,076
458,814
Investments in securities .....................
269,162
288,614
Reserve bal. with F. R. b a n k ...............
27,929
Cash in vaults ...........................................
27,877
696,815
Demand deposits .....................................
703,305
207,584
Time deposits ...........................................
208,558
Money borrowed ..........................................
0
0

July 10
1940
$121,200
149,917
407,515
218,375
23,103
574,902
202,182
0

M UTUAL SAVINGS BAN K DEPOSITS
10 Baltimore Banks
June 30
1941
Total deposits

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

CITIES

$224,593,340

May 31
1941

Dist. of Col.
Washington . . . .
Maryland
Baltimore
...........
Cumberland .........
Hagerstown .........
North Carolina
Asheville .............
Charlotte ...............
Durham ...............
Greensboro ...........
Raleigh .................
Wilmington ........
Winston-Salem . ..
South Carolina
Charleston ...........
Columbia .............
Greenville .............
Spartanburg ----Virginia
Danville ...............
Lynchburg ...........
Newport News . .
Norfolk
...............
Portsmouth .........
Richmond ...........
Roanoke ...............
West Virtginia
Charleston ...........
H u ntin gton ...........
Parkersburg
District Totals

..

$ 359,738

$ 358,663

$ 297,719

559,072
11,035
11,821

■493,412
9,352
11,056

17,169
96,732
317,862
26,877
60,094
19,369
48,783

SALES OF NEW AU TOM O BILES

of Change
Month Year

%

+ 21

389,042
9,253
9,802

+ 13
+ 18
+ 7

+ 44
+ 19
+ 21

16,774
96,343
33,975
27,309
51,214
17,425
47,254

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

+ 2
+ o
+ 11
— 2
+ 17
+ 11
+ 3

b33
-50
-20
-27
-25
-70
-14

30,603
39,748
26,890
14,654

30,494
42,753
28,629
16,859

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

+ 0
— 7
— 6
— 13

+
+
+
+

41
44
50
41

10,093
17,493
15,364
73,862
6,848
193,695
34,966

9,838
16,959
16,466
75,720
6,833
181,474
36,044

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

+
+
—
—
+
+
—

+
+
+
+
+
+
+

22
20
25
39
42
29
22

62,293
20,465
11,692

60,093
19,732
12,605

51,572
18,136
10,701

$1,807,218

$1,717,276

$1,367,716

+

3
3
7
2
o
7
3

+ 4
+ 4
— 7

+ 21
+ 13
+ 9

+




234
294

6,702
7,119

Total Liabilities
District
U. S.
$ 152,000
$ 9,449,000
281,000
10,065,000
801,000
13,734,000
2,533,000
3,416,000

REGISTRATION OF N EW PASSENGER CARS— NUMBER
STATES
Maryland ...........
Dist. of Col. . . .

Business failures in the Fifth district in June 1941
were fewer in number and lower in aggregate liabilities
involved than in either May 1941 or June 1940, accord­
ing to figures reported by Dun & Bradstreet. Statistics
for several periods were as follows :

6 Months, 1941.......................
6 Months, 1940.......................

Sales of new automobiles in the Fifth district dropped
substantially in June from sales in May, but continued
far ahead o f June 1940 sales. Last month’s decrease was
partly seasonal and partly due to inability o f dealers to
secure all models in sufficient quantity. Aggregate sales
in the first six months o f 1941 were larger than in any
other corresponding period on record. Higher purchas­
ing power as a result o f increased employment in defense
work, anticipation of higher prices for 1942 models, and
fear of inability to secure prompt deliveries in the fall or
next spring, all stimulated new car buying in recent
months. The demand for better cars overflowed into the
used car market, and many people who do not buy new
cars traded their old ones in on later model used cars.
Dealers have been able to obtain enough cars to meet
their needs until quite recently, but shortages are begin­
ning to develop in some models, and occasional dealers,
chiefly in middle and higher priced cars, report advanced
sales sufficient to take all the new cars they expect to
obtain the balance o f this model years.
The following registration figures for new passenger
cars were furnished by R. L. Polk & Co., of Detroit:

+ 32

5

C O M M E R C IA L FAILURES

Number of Failures
District U. S.
27
970
37
1,119
47
1,114

...........
Dist. of Columbia .............................. ...........
...........
West Virginia .................................... ...........
North Carolina ...............^................ ...........
South C arolina.................................... ...........
District Average ......................... ...........

Percentage change from
May 1941 to June 1941
in number
in amount
on payroll
of payroll
+ 3 .0
+ 5.6
— 1.0
+ 0.8
+ 3.8
+ 1 .5
+ 1.2
+ 1 .6
+ 0.5
+ 1 .1
+ 0 .9
+ 0.9
+ 1 .5
+ 2.4

$223,515,446

o

PERIODS
June
1941.......................
May
1941.......................
June
1940.......................

STATES

June 30
1940

$224,836,673

DEBITS TO IN D IVID UAL ACCOUNTS
Fifth District
000 omitted
June
May
June
1941
1941
1939

There were no outstanding developments in employ­
ment in June and the first half of July in the Fifth R e­
serve district. Skilled industrial workers and trained me­
chanics o f practically all types are fully employed, and
there is relatively little unemployment among unskilled
laborers. There continues to be a surplus o f clerical help,
however, partly due to students desiring vacation work.
Seasonal lay-offs have been few this summer, and shut­
downs to. overhaul machinery are being made as short as
possible. The following figures, compiled for the most
part by the Bureau o f Labor Statistics, reflect the trends
of employment and payrolls in the Fifth district from
May to Jun e:

72,156,000
83,481,000

West Virginia . .
No. Carolina . ..
So. Carolina .. .
District ...........

June
1941
6,767
3,612
8,954
5,615
7,121
3,735
35,804

June
1940
5,015
2,996
5,507
4,391
3,907
2,319
24,135

%
Change
+ 35
+ 21
+ 63
+ 28
+ 82
+ 61
+ 48

6 Months 6 Months
1941
1940
37,148
26,844
20,262
15,104
43,377
28,605
21,767
17,310
41,863
26,656
22,954
15,195
187,371
129,714

%
Change
+ 38
+ 34
+ 52
+ 26
+ 57
+ 51
+ 44

CO N STRU CTION PERMITS AN D CO N TRACTS

Construction work provided for in permits issued and
contracts awarded in June in the Fifth district continued
at a very high level. Building permits issued in 29 cities
last month totaled $13,533,100 in estimated valuation, an
increase o f 27 per cent above $10,664,464 in permits in

3

MONTHLY REVIEW
June 1940. Permits in the first half of 1941 totaling
$73,789,147 exceeded those issued in the first half o f
1940, valued at $57,002,309, by 29 per cent. In June
1941 Washington led in permits with $4,982,670, Balti­
more was second with $2,388,186, Charleston, S. C., third
with $1,076,090, Richmond fourth with $712,044, and
N orfolk fifth with $588,585. Washington permits in­
clude no Government work, for which city permits are
not required.
Contracts awarded for construction work in the dis­
trict in June 1941 totaling $92,503,000 were the third
highest in valuation on record for a single month, and
exceeded contracts totaling $29,161,000 in June 1940 by
217 per cent. In the first half of 1941, contracts award­
ed in the district totaling $373,513,000 not only exceeded
awards in any other half year, but also exceeded awards
for the entire year in 13 of the past 20 years. Much o f
the construction work for which contracts were awarded
in the past year was a part o f the defense program, but
non-defense work has also been at a relatively high level
in recent months.
Figures on contract awards by states for May 1941,
which were not available when the June 30 R eview went
to press, were reported by the F. W . Dodge Corporation
as fo llo w s:
CONSTRUCTION CONTRACTS AW ARDED
STATES

May 1941

May 1940

% Change

$ 15,974,000
$ 9,746,000
+ 64
Maryland .............................
Dist. of Col. •......................
4,934,000
10,374,000
— 52
Virginia ...............................
13,151,000
7,262,000
+ 81
West Virginia ...................
4,669,000
3,681,000
+ 27
North Carolina .................
42,686,000
5,785,000
+ 63<8
South Carolina ................. ................. 18,591,000_________ 2,491,000_______ + 6 4 6
Fifth District .................
$100,005,000
$39,339,000
+154

C O A L PRO D U CTIO N

T o meet expanding needs o f industries, and in an e f­
fort to rebuild reserves which were depleted during the
April shut-down o f bituminous mines, soft coal mines
increased daily production further in June, although total
tonnage for the month was slightly less than in the longer
month of May. Production o f 43,090,000 net tons in
the United States in June exceeded June 1940 production
of 32,400,000 tons by 33 per cent, and brought tonnage
for the first half of this year to 226,226,000 tons against
219,583,000 tons mined in the first half of 1940, an in­
crease of 3 per cent this year in spite of the fact that
production in April 1941 was merely nominal. Coal
loaded at Hampton Roads ports from January 1 to July
12 totaled 11,455,794 tons this year against 12,645,284
tons in 1940 when there was no strike in coal fields. In
the Fifth district, bituminous coal mined in June 1941,
May 1941 and June 1940, was as follow s:
SOFT COAL PRODUCTION IN TONS
REGIONS
West Virginia .......................
Virginia
..................................
Maryland ..................................
5th District ...................
United States ...............
% in District .................

June 1941
May 1941
June 1940
12,965,000
13,429,000
9,961,000
1,635,000
1,660,000
1,110,000
151,000__________ 135,000___________ 91,000
14,751,000
15,224,000
11,162,000
43,090,000
43,400,000
32,400,000
34.2
35.1
34.5

CO TTO N TEXTILES

In the first half of June print cloths and sheetings were
very active and sales by manufacturers totaled about eight
weeks’ production, and twills, drills, osnaburgs and ducks




also sold freely. Arm y buying continued large and the
Government invited bids for the first time in line with
the provisions o f the Lend-lease Bill. However, the im­
position o f price ceilings by the O P A C S on print cloths,
carded broadcloths, tobacco cloths, combed broadcloths,
sheetings and osnaburgs caused a cessation o f selling or
buying toward the end o f the month, and quoted prices
were nominal on goods affected by the ceiling prices.
W ith mills sold up from five to six months in many in­
stances, the Journal o f Commerce states that mills are
faced with the necessity o f paying rebates on contracts
probably amounting to about 700,000,000 yards. The ceil­
ing prices set were substantially lower than market quo­
tations, but some adjustments o f the differences were
made shortly after the middle o f July, ceiling prices being
raised to bring them more nearly in line with advanced
costs o f production. Mill margins, the difference be­
tween the price o f a pound o f cotton and its approximate
cloth equivalent, averaged 21.84 cents in June 1941
against 20.85 cents in May and 10.68 cents in June 1940.
The 10-year (1930-39) average margin for June was
11.82 cents.
COTTON CONSUMPTION— FIFTH DISTRICT
In bales
MONTHS
No. Carolina So. Carolina Virginia
June
1941...................
215,790
156,943
19,246
May
1941...................
223,743
169,452
20,192
144,430
116,248
10,440
June
1940...................
6 Months,
6 Months,

1941...................
1940...................

1,279,532
1,004,860

RAYON YARN

964,944
783,394

107,576
78,471

District
391,979
413,387
271,127
2,352,052
1,866,725

PRO D U CTIO N

Shipments o f rayon filament yarn to domestic con­
sumers totaled 38,600,000 pounds in June 1941, a slightly
lower figure than the record o f 40,200,000 pounds shipped
in the longer month o f May but 23 per cent above 31,400.000 pounds shipped in June last year. For the third
consecutive month shipments exceeded production, and
reserve stocks o f yarn dropped from 5,800,000 pounds to
4.300.000 pounds during June. Rayon Organon states
that shipments totaled 219,500,000 pounds in the first
half o f 1941, an increase of 18 per cent above shipments
o f 186,100,000 pounds in the corresponding period last
year. On June 16, one large rayon producer changed
selling terms from 2 % thirty days, net 31, to net 30 days,
and the change was generally followed in the market.
The elimination o f the cash discount increased rayon
prices slightly, o f course, but the increase was nominal
in comparison with recent upward trends o f cotton, wool
and silk. In contrast with these rising prices, nylon
yarns were reduced on June 16 by amounts rangii^g from
10 cents to 30 cents per pound, according to deniers.
C O TTO N

STATISTICS

Spot cotton prices on 10 Southern markets, which had
been advancing steadily since the middle o f May, dropped
sharply in the first week o f July as a result o f the ceilings
set for certain textiles by the O P A C S , but the decline
was temporary and on July 18 the average for middling
cotton on the 10 markets was 15.48 cents, the highest
price reached since April 11, 1930. On July 19, 1940,
the average price was 10.31 cents, the current price show­
ing an advance o f $25.85 per bale within the year.

MONTHLY REVIEW

4

On July 8, the Department o f Agriculture reported the
1941 cotton acreage at 23,519,(XX) acres, 94.6 per cent of
the area in cultivation on July 1 last year, and the small­
est acreage in almost half a century. In the Fifth dis­
trict, Virginia’s 35,000 acres are 105 per cent o f last
year’s acreage, but South Carolina’s planting o f 1,243,000
acres is only 98 per cent and North Carolina’s planting
of 807,000 acres is only 96 per cent o f 1940 acreage. No
official data on the condition of this year’s crop will be
available until August.
COTTON CONSUMPTION AND ON H AND— BALES
June
1941
fifth district states:
Cotton consumed .......................

June
1940

Aug. 1 to June 30
This Year Last Year

W HOLESALE TRADE, 195 FIRMS

391,979

United States:
875,137
Cotton consumed .......................
Cotton on hand June 30 in
Consuming establishments . . 1,918,335
Storage & compresses ........... 10,570,235

271,127

4,002,796

Automotive supplies (9 ).
Shoes (4) .........................
Drugs & sundries (12) . .
Dry goods (8) .................
Electrical goods (10) . . .
Groceries (63) .................
Hardware (13) ...............
Industrial supplies (9) .
Paper & products (9)
Tobacco & products (8 ).
Miscellaneous (50) .........
District Average (195)

■489,191

7,488,516

6,111,530

903,285
9,516,166
565,416

8,789,277

1,160,912
9,576,683

7,161,051

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

June 1941

May 1941

June 1940

24,729,260
25,621,949
24,763,334
18,498,764,92017,858,111,310 17,565,041,013
478,802,003
475,067,340
435,029,473
2,930,255
3,609,796
2,896,537

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

% Change
Acreage
Wheat

West V ir g in ia .........
North Carolina . . .
South Carolina , . .
District Av...........

West V ir g in ia .........
North Carolina . . .
South Carolina . . . . . .
District

West V ir g in ia .........
North Carolina . . .
South Carolina . . .
District ...............

DEPARTMENT STORE TRADE
Percentage increase or decrease in sales, stocks,
outstanding orders and outstanding receivables in
June 1941 in comparison with June 1940 figures:
Sales

+ 8
+
+
+
+

+
+
+
+
+

14
15
17
15

14
16
16
14
23

( + 15)
( + 19)
( + 20 )
( + 15)
( + 19)
(+
(+
(+
(+
(+

Stocks
+22
+ 16
+ 15
+ 12
+ 16

Orders Receivables
+ 78
+ 11
+12
+ 136
+ 13
+ 119
+ 131
+1
0
+12
+ 116

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

18)
21)
16)
17)
21)

RETAIL FURNITURE

Individual Cities:
Baltimore (9) ........
Richmond (5) ..........
Washington (7) -----




+ 22
— 2
— 12
+ 6
— 5
— 10
+ 2

+ o

15
13
26
41
48
15
11
23
11
9
30
24

— 4
+ 17
+ 3
+ 8
— 5
+ 0
+ 6
— 2

+ 4
— 3
1
3

+
+

77
61
113
44
73
94
50
75
78
86
72
72

—
—
—
+
+

2
3
6
8
8

+

Yield
1941
(Bushels)

Yield
1940

Yield
1930-1939

7,220,000
7,155,000
1,768,000
6,830,000
2,900,000
25,873,000'

7,566,000
8,463,000
2,016,000
6,132,000
2,688,000
26,865,000

8,342,000
8,643,000
2,154,000
4,807,000
1,364,000
25,310,000

1,120,000
1,932,000
1,462,000
5,952,000
10,890,000
21,356,000

1,325,000
2,116,000
1,931,000
4,460,000
9,238,000
19,070,000

+

1
Oats (Bushels)
11
1,209,000
25
1,942,000
1,491,000
4
5
6,110,000
5
11,700,000
22,452,000
7

—
—
—
—
—
-

Com (Bushels)
8
16,13*5,000
4
32,389,000
7
12,182,000
2
46,215,000
2
23,814,000
3
130,735,000

17,535,000
36,490,000
12,852,000
44,733,000
24,304,000
135,914,000

16,173,000
32,418,000
12,610,000
43,507,000
22,831,000
127,539,000

+
+
+

1
0
2

Hay (Tons)
470,000
874,000
701,000
870,000
8
550,000
3,465,000
2

550,000
1,252,000
833,000
975,000
539,000
4,149,000

467,000
924,000
642,000
744,000
398,000
3,175,000

+
+
+
+
+

+
+

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

Note: Second figure, in parentheses, under Sales compares combined
in 6 months of 1941 with sales in first 6 months of 1940.

Maryland (9) ..........
Dist. of Col. (7)
Virginia (13) ...........
North Carolina (5)
South Carolina (7)
District (41) ........

+ 4

+
+
+
+
+
+
+
+
+
+
+
+

Irish Potatoes (Bushels)
— 3
2,586,000
+ 1
6,237,000
0
3,300,000
6,642,000
+ 7
2,670,000
+ 1
21,435,000

2,898,000
10,412,000
3,630,000
8,720,000
3,192,000
28,852,000

2,997,000
10,661,000
2,844,000
8,182,000
2,475,000
27,159,000

North Carolina . . .
South Carolina . ..
District - .............

Sweet Potatoes (Bushels)
+ 11
1,700,000
1,485,000
+ 3
3,875,000
3,680,000
+ 8
8,400,000
7,104,000
+ 3
5,525,000
5,040,000
+ 6
19,305,000
17,504,000

1,071,000
4,061,000
8,354,000
5,401,000
18,887,000

* Includes stores reporting sales only.

STATES

+ 2
— 17
— 4

May 31 outstanding
1941
June 1

The following figures, issued by the Department of
Agriculture, show forecasts of production based on July
1 conditions, compared with yields in 1940 and in the
10-year period 1930-39, and percentage changes in acre­
age this year over or under 1940 acreage:

1,050,776 6,054,961
................................

Production figures on tobacco products manufactured
in the United States in June 1941, released by the Bureau
o f Internal Revenue, compare as follows with figures for
May 1941 and June 1940:

%

b 67
-104
- 27
- 54
-109
- 13
- 40
- 57
- 3‘8
- 11
- 50
- 45

June 30
1940

CROP FORECASTS

TO BAC CO M A N U FA C TU R IN G

Same stores by States:
Maryland (13) .................
Virginia (16) .................
West Virginia (15) ----North Carolina (16) . . . .
South Carolina (12) ------

May
1941

3,433,200

133,530
Exports of cotton .........................
75,236
Spindles active, U. S....................... 22,991,546 21,954,616

Richmond (5) .........
Baltimore (10) ----Washington (7) . . .
Other Cities (12) .
Fifth District (79)*

June
1940

LINES

Ratio June
collections
to accounts

Source: Bureau of the Cenpus.

Cotton growing states:
Cotton consumed .......................
742,792
Cotton on hand June 30 in
Consuming establishments . . 1,522,775
Storage & compresses ........... 10,171,354

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

Stocks
June 30., 1941
compared with

Net Sales
June 1941
compared with

SALES

Changes in Sales, June and 6 Months of 1941
Compared with Compared with
June 1940
6 Months
+ 27
+ 22
+ 45
+ 38
+ 26
+ 28
+ 27
+ 23
+ 36
+ 20
+ 31
+ 29
+ 27
+ 2
+ ■5
4

+ 22
+ 10
+ 38

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

Tobacco (Pounds)
+ 3
33,235,000
— 2
90,950,000
— 10
2,170,000
+ 1
504,380,000
+ 5
80,750,000
+ 1
711,485,000

31,920,000
100,509,000
2,790,000
526,505,000
82,215,000
743,939,000

26,901,000
99,861,000
2,985,000
529,356,000
85,656,000
744,759,000

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

Peaches (Bushels)
440,000
1,993,000
490,000
2,484.000
3,120,000
8,527,000

470,000
1,392,000
446,000
1,344,000
2,158,000
5,810,000

348,000
902,000
267,000
1,920,000
1,236,000
4,673,000

(Compiled July 21, 1941)

MONTHLY REVIEW, July 31, 1941

FEDERAL RESERVE BANK OF RICHMOND

SUMMARY OF NATIONAL BUSINESS CONDITIONS
(Compiled by the Board of Governors of the Federal Reserve System)
INDUSTRIAL PRODUCTION

Federal Reserve index o f physical volume of pro­
duction, adjusted for seasonal variation, 1935-39
average=100.
Subgroups shown are expressed in
terms of points in the total index.
By months,
January 1935 to June 1941.

WHOLESALE PRICES

Bureau of Labor Statistics’ indexes, 1926 =10 0.
“ Other” includes commodities other than farm
products and foods.
By weeks, January 5, 1935
to week ending July 12, 1941.

MEMBER BANK RESERVES AND RELATED

ITEMS

W ednesday figures, January 4, 1939 to July
1941.

MEMBER BANK RESERVES
B L N O D LA S
IL IO S P OL R

W ednesday figures, January 2, 1935 to July 9,
1941.
Required and excess reserves, but not the
total, are partly estimated.




Industrial production increased fu rth er in June, continuing the rapid ad­
vance that began about a year ago. C om m odity prices, both in retail and in
wholesale m arkets, rose considerably betw een the early part o f June and the
third w eek o f July.
P R O D U C TIO N
R eflecting the continued advance in industrial activity at a tim e w hen ou t­
put ordinarily declines, the B oa rd’ s adjusted index advanced fr o m 150 p er cen t
o f the 1935-1939 average in M ay to 156 in June and prelim inary estimates
indicate a fu rth er rise in July. The curren t level com pares w ith 104 b e fo re
the start o f the European w ar and 111 in the spring o f 1940, w hen the curren t
advance in industrial activity began.
Further increases in output w ere reported in June f o r a considerable num ­
ber o f industries, particularly those associated closely w ith the defen se program ,
and there w ere no im portant declines. A s in oth er recen t months, activity in
the aircra ft, shipbuilding, m achinery, and railroad equipm ent industries rose
sharply. A u tom obile production was m aintained at the high level o f May,
ow in g m ostly to unusually large retail sales.
O utput o f iron and steel and
n on ferrou s metals, already close to capacity, did n ot show an increase to c o r ­
respond w ith the rise in output o f finished m etal products and official statem ents
indicated g row in g con cern over shortages o f num erous m aterials. Steel in got
produ ction rem ained close to 99 per cent o f capa city during June, bu t the rate
in the m iddle o f July w as slightly low er. F or the year to date output o f steel
has averaged 98 per cent o f the rated capacity as o f D ecem ber 1940.
O utput o f textiles and m ost other n ondurable m a nu factu res in June con ­
tinued at recent advanced levels, w hich in some instances represent capacity
production.
O utput o f chem icals continued to increase rapidly.
A lso, there
was a sharp rise in rubber consum ption, reflectin g continued heavy dem and fo r
ru bber products and the fa c t that June w as the last m onth b e fo r e curtailm ent
o f ru b ber consum ption by industry was to go into effect and was the m onth to
be used in apportion ing July consum ption am ong various m anufacturers.
M ineral production increased in June, w ith a m arked rise in output o f
anthracite, som e fu rther increase in output o f bitum inous coal, and a continued
advance in crude petroleum production to a new high level.
V alue o f construction con tra ct awards in June continued at the high level
reached in M ay and was n early tw o-thirds above a year ago, a ccord in g to figures
o f the F. W . D odge C orporation. A w ards fo r pu blic construction again increased
sharply, reflectin g continued expansion in the volum e o f defen se construction
projects. Private residential building contracts declined som ew hat m ore than
seasonally, follow in g an increase in May.
D IST R IB U T IO N
Sales o f general m erchandise show ed little change fro m M ay to June.
D epartm ent store sales decreased m ore than seasonally, w hile rural retail and
v ariety store sales remained at the M ay level, although a decline is usual at
this tim e o f the year. In the early part o f July sales at departm ent stores rose
som ewhat and w ere 24 per cent higher than a year ago.
Loadings o f revenue freig h t increased fu rth er in June, reflecting continued
expansion in shipments o f coal and m iscellaneous m erchandise, and by the end
o f the m onth w ere in larger volum e than at any tim e during the seasonal peak
last autumn.
C O M M O D ITY P R IC E S
W holesale prices o f m ost grou ps o f com m odities continued to advance
from the early part o f June to the m iddle o f July. Prices o f food stu ffs showed
large increases and there w ere substantial advances in prices o f a num ber o f
industrial raw materials and finished products. F ollow in g earlier marked ad­
vances, prices o f hides and cotton gray g oods w ere redu ced b y G overnm ental
action. Retail prices fo r foods and m any other com m odities have been rising
and in June the cost o f living was abou t 4 per cent higher than 4 m onths earlier.
P relim inary figures indicate fu rth er advances in July.
B A N K C R E D IT
H oldings o f United States G overnm ent securities b y m em ber banks in 101
leadin g cities increased fu rth er during June and early July, reflectin g in part
new offerings by the Treasury.
Com m ercial loans continued to rise sharply.
N otw ithstanding the grea ter volum e o f bank loans and investm ents, d e­
posits o f city banks declined som ewhat over the period, reflecting m ainly a
grow in g dem and fo r cu rren cy and a bu ildin g up o f Treasu ry deposits at the
R eserve Banks. These developm ents also resulted in a decrease in the volum e
o f excess reserves, which am ounted to about $5,300,000,000 on Ju ly 16, com ­
pared with $6,900,000,000 a year earlier.
UNITED S T A T E S G O V E R N M E N T SE C U R IT Y PR IC E S
United States G overnm ent securities advanced fu rth er du ring the latter
part o f June. Partially tax-exem pt 1960-65 bonds on June 26 w ere at an alltim e peak, on a 2.02 yield basis. Since that tim e th ey have declined slightly.
T axable bon ds generally continued to advance to successive new high levels.
Y ields on T reasury notes show ed little change during the latter pa rt o f June
and the first h a lf o f July.

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