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MONTHLY

REVI EW

of Financial and Business Conditions

■a

_____

Fifth
Federal

i

*• ic n n a
K h io id

« x _ :" " va.

3

R eserve
D istric t

Federal Reserve Bank, Richmond, Va.

July 31, 1942

Buy
W ar
B onds




in v est

Buy
S a v in g s
St a m p s

for

v ic t o r y

now

2

MONTHLY REVIEW

Summary of June Business Conditions
ITH plants working to capacity on the war pro­
gram, and workers having higher incomes than ever
before, business activity has shown less than the usual
seasonal recession in recent weeks, and continues much
above the rate of activity a year ago in those lines which
are not artificially restricted in the interest of public de­
fense.
The Federal Reserve Bank of Richmond increased its
holdings of Government securities between the middle of
June and the middle of July, and there was a further in­
crease in the volume of Federal Reserve notes in circu­
lation. The bank’s cash reserves also rose during the
month, but member bank reserve deposits showed a mod­
erate decline. In 41 regularly reporting member banks
loans decreased slightly between June 17 and July 15,
but there was a substantial increase in investments, chiefly
Government securities. During the same period demand
deposits rose sharply, and there was also a slight increase
in time deposits. At mutual savings banks in Baltimore,
aggregate deposits rose during June, reversing a down­
ward trend which had been noted in earlier months this
year. Debits to deposit accounts in 25 Fifth District
cities rose 3 per cent in June over debits in May, re­
flecting an increased volume of checks passing through
the banks.
Commercial failures in the Fifth District in June were
less numerous than in either May this year or June last
year, and the total number of failures in the first half
of this year was 23 per cent below the number in the
first half of 1941.
Industry continues to concentrate on war work. In
the Fifth District the cotton textile industry is working
at capacity, and practically all mills which could do so
have converted their machinery to the manufacture of
the types of textiles required by the armed forces and for
essential civilian needs. In the rayon field, manufacturers
are working 24 hours a day and are producing all of the
yarn which can be turned out by available plant facilities.
Bituminous coal production in June exceeded production
in either May 1942 or June 1941, and in the first half of
this year coal mined in the United States exceeded by 24
per cent the amount of coal produced in the correspond­

W

ing period last year. In tobacco manufacturing, a new
monthly record was set in the production of cigarettes in
June, output reaching twenty billion for the first time.
Eighty-seven per cent of these cigarettes were manufac­
tured in Virginia and North Carolina.
The distribution of merchandise to consumers con­
tinues at high levels, in spite of the fact that numerous
commodities are frozen or are no longer manufactured.
Sales in 78 department stores in the Fifth District in June
were 12 per cent above sales in June 1941, and total sales
for the first half of this year were 2 1 per cent above sales
in the first half of last year. Retail furniture sales in 117
stores showed a decrease of 23 per cent in June 1942 sales
in comparison with sales in June 1941, but this decline was
at least partly due to restrictions on instalment selling
laid down in Regulation W. Wholesale trade by 207
firms in a number of leading lines rose 15 per cent in
June over sales a year ago.
■ Agricultural statistics issued by the Department of
Agriculture indicate better than average prospects for
most 1942 crops in the Fifth District. A. slight decrease
in the expected yield of wheat in the district is forecast
on the basis of July 1 conditions, and the yield of peaches
is also expected to be less than in 1941. On the other
hand increases in yields are forecast for oats, corn, hay,
Irish potatoes, sweet potatoes, and tobacco. In tobacco,
which is the leading cash crop in the Fifth District, the
increase in acreage planted was 10 per cent this year, and
the prospective yield of 734,267,000 pounds is 13 per
cent above the 1941 yield of 650,557,000 pounds. In­
creased acreage figures are shown this year for oats, hay,
Irish potatoes and tobacco while reductions of 1 per cent
were made in the acreage planted in wheat, corn, and sweet
potatoes. No production figures are released on cotton
until August, but on July 8 the Department of Agricul­
ture announced that the cotton acreage is 3.8 per cent
larger this year than last, and unofficial reports indicate
that the development of the crop has been satisfactory
throughout most of the belt. In view of the prices pre­
vailing this year for agricultural products, and favorable
prospects for final yields, the farmers of the Fifth District
appear to occupy a strong position.

FINANCIAL AND BUSINESS CONDITIONS IN THE FIFTH FEDERAL RESERVE DISTRICT

Debits to individual accounts (25 cities).................... ..........
Sales, 78 department stores, 5th district......................
Sales, 117 furniture stores, 5th district.............. ....................
Sales, 207 wholesale firms, 5th district...................................

June 1942
$2,098,939,000
'$ 16,563,972
$
2,353,855
$ 17,853,000

May 1942
$2,038,925,000
$ 17,187,817
$
2,785,324
$ 17,758,000

Number of business failures, 5th district....................
Liabilities in failures, 5th district..........................................
Value of building permits, 29 cities..............................
Value of contracts awarded, 5th district.................... ...........

19
$
882,000
$
8,373,433
$ 160,508,000

$
$
$

Cotton consumption, 5th district (Bales).................... ...........
Cotton price, cents per lb., end of month.................... ..........
Rayon yarn shipments, U. S. (Pounds)...................... ..........
Rayon yarn stocks, U. S. (Pounds)...........................
Bituminous coal mined, U. S. (Tons)............... ...... ..........

458,572
19.88
39,000,000
5,800,000
48,410,000




35
485,000
5,476,957
68,914,000
452,996
19.66
37,600,000
6,900,000
48,250,000

June 1941
$1,807,218,000
$ 14,802,900
3,054,167
$
$ 15,582,000
$
$
$

% Change
Month Year
+
—
—
+

3
4
15
1

+
+
—
+

16
12
23
15

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

— 46
+ 82
4- 53
+133

— 30
+480
— 38
+ 74

392,479
14.82
38,300,000
4,600,000
43,319,000

+ 1
+ 1
+ 4
— 16
0

+
+
+
+
+

17
34
2
26
12

MONTHLY REVIEW
BANKING STATISTICS
RESERVE BANK STATEMENT ITEMS
Fifth District
July 15
1942
50

Discounts held .............................
Foreign loans on gold...............
Industrial advances.....................
Government securities . . ..........
Total earning assets .............
Circulation of Fed. Res. notes.
Members’ reserve deposits........
Cash reserves ...............................
Reserve ratio .............................

000 omitted
June 15
1942
$
50

July 15
1941
$
0

22

ITEMS

0

619
818
153 114_____ 119,663
120,481
153,805
321,434
501,602
414,644
483,992
713,046
876,016
85.60
85.12

767
186,441
187,324
522,452
466,784
910,332
82.80

SELECTED ITEMS— 41 REPORTING MEMBER BANKS
Fifth District
000 omitted
July 16
ITEMS
July 15
June 17
1941
1942
1942
$150,691
$147,234
$141,624
Loans to business & agriculture.
167.624
161,756
162,324
All other loans...............................
628,623
459,037
690,632
Investments in securities................
284,896
299,906
Reserve bal. with F. R. bank... .
304,775
26,141
Cash in vaults...............................
29,579
29,486
860,351
711,959
888,578
Demand deposits ...........................
199,892
208.624
201,615
Time deposits .................................
0
0
Money borrowed ............................
0
MUTUAL SAVINGS BANK DEPOSITS
9 Baltimore Banks
Total deposits

June 30, 1942
$221,023,216

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

May 31, 1942
$219,575,973

June 30, 1941
$224,593,340

DEBITS TO INDIVIDUAL ACCOUNTS
Fifth District
June
1942

CITIES
Dist. of Col.
Washington

$ 419,803

000 omitted
May
June
1942
1941
$ 422,584

Month

Year

$ 359,738

■1

+ 17

+ 1
+ 8
+ 11
— 2

+ 7
— 5

+ 10
— 2
+ 18
+ 24
— 7
+ 5
+ 4
+ 21
+ 5

+
+
+
+

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

599,477
10,511
9,795*
14,409

593,473
9,755
8,853*
14,651

559,072
11,035

North Carolina
Asheville ............
Charlotte ............
Durham ................
Greensboro ..........
Kinston ................
Raleigh ..................
Wilmington..........
Wilson .................
Winstom-Salem ..

19,371
120,297
61,560
29,629
4,183*
46,181
26,994
5,308*
54,718

17,576
122,287
52,052
23,969
4,477*
44,051
25,946
4,370*
52,122

17,169
96,732
37,862
26,877

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

35,380
42,755
32,982
17,584

32,374
41,577
33,059
18,213

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

Virginia
Charlottesville .. .
Danville .............
Lynchburg ..........
Newport News ..
Norfolk ...............
Portsmouth ..........
Richmond ............
Roanoke ..............

10,519*
11,918
19,532
19,564
115,313
13,758
241,653
35,969

10,104*
10,313
17,706
17,668
109,497
12,343
232,704
34,496

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

West Virginia
Bluefield ..............
18,688*
21,668*
Charleston ..........
71,675
65,080
Clarksburg ..........
13,732*
12,590*
Huntington ..........
24,729
23,059
Parkersburg
13,177
12,370
District Totals . .
2,098,939
$2,038,925
K
Figures not included in District Total.

</o of Change

Vl,82i

’60,094
19,369
48,783

62,293
20,465
11,692
$1,807,218

+
+

9
3
0
- 3

+
+
+
+
+
+
+
+

4
16
10
11
5
11
4
4

-1 4
+ 10
+ 9
+ 7
+ 7
+ 3

+ 22
13
24
63
10

— 23
+ 39
+ 12
+ 16
+ 8
+ 23
+ 20

are having in securing sufficient goods to meet the needs
of their customers. However, the failure statistics do not
tell the whole story of the effects of rationing, freezing,
etc., since many firms have liquidated before reaching the
bankruptcy point. Figures on insolvencies in the dis­
trict and the United States, as compiled by Dun & Bradstreet for several recent periods, are as follows:
PERIODS
June
1942............ .......
May
1942............ ........
June
1941............ ........
6 Months, 1942............ ........
6 Months, 1941............ ........

Number of Failures
District U. S.
19
804
35
955
27
970
180
233

5,623
6,702

Total Liabilities
District
U. S.
$ 882,000
$ 9,906,000
485,000
9,839,000
152,000
9,449,000
2,373,000
2,533,000

60,585,000
72,156,000

EMPLOYMENT

As workers continue to be absorbed into the armed
forces of the Nation it is becoming harder to secure effi­
cient labor in numerous fields, especially those not directly
connected with some phase of war work. Many young
men entering the army or navy are being replaced by
older men and to some extent by women. At the same
time dislocations in business due to priority regulations,
rationing, freezing orders, etc., are causing unemploy­
ment. Some of these workers are readily absorbed by
industries doing war work, but others are specialists or
are too old to make the shift to new lines, and these are
forced into the ranks of the unemployed. Increasing
economic pressure on family groups resulting from
greatly increased taxes, rising costs of living and bond
buying is making it necessary for additional people to
obtain remunerative employment, particularly in the large
white collar group which has had little or no increase in
income in recent months. The following figures, com­
piled for the most port by the Bureau of Labor Statistics,
show the trends of employment and payrolls in the Fifth
District from May to June:
STATES
.....................
Dist. of Col.................................. .....................
.....................
West Virginia ........................... .....................
North Carolina ........................... .....................
South Carolina ........................... .....................
District Average ................... .....................

Percentage change from
May 1942 to June 1942
in number
in amount
on payroll
of payroll
+ 2.0
+ 5.4
— 1.3
— 0.1
+0.3
— 1.7
+ 0.5
+ 1.8
—0.4
- 0 .5
+ 0.4
+1.1
+ 0.7
+ 1.6

BITUMINOUS COAL PRODUCTION
+ 18
+ 12
+ 27
+ 56
+ 101
+ 25
+ 3

+ is
+ 21
+ 13'
+ 16

COMMERCIAL FAILURES

Commercial failures in both the Fifth district and the
United States were less numerous in June this year than
in June 1941, notwithstanding the difficulty many firms




3

Production of bituminous coal in the United States in
June 1942 totaling 48,410,000 net tons exceeded the May
1942 output of 48,250,000 tons and was 12 per cent above
43,319,000 tons mined in June 1941. Total production
this calendar year through July 11 was 300,658,000 net
tons, an increase of 24 per cent above 243,111,000 tons
produced to the corresponding date last year. The de­
mand for bituminous coal is much greater this year than
last, due chiefly to the greatly expanded production pro­
gram in industry as a result of the war effort, and to build
up supplies for heating to supplement sharply diminished
supplies of fuel oil. It is feared that if householders do
not stock their bins with coal before winter comes, trans­
portation facilities may be so severely strained that they
will not be able to move sufficient coal to meet all needs
for both industry and heating.

MONTHLY REVIEW

4
SOFT COAL PRODUCTION IN TONS
REGIONS
West Virginia .....................
Virginia .................................
Maryland ...............................
5th District .....................
United States .................
c in District.....................
/o

June 1942
13,750,000
1,787,000
181,000
15,718,000
48,410,000
32

May 1942
13,29i6,000
1,755,000
175,000
15,226,000
48,250,000
32

June 1941
13,035,000
1,642,000
155,000
14,832,000
43,319,000
34

CONSTRUCTION

Building permits issued in leading Fifth District cities
in June 1942 totaled $8,373,433, an increase of 53 per
cent over permits totaling $5,476,957 issued in May this
year but 38 per cent less than the total of $13,533,100 for
June last year. Building permit figures reflect civilian
construction for the most part, and are showing the effects
of restrictions on the use of building materials for work
not connected with the war effort. Most of the con­
struction for war purposes is in rural communities or
comparatively small cities and is not reflected in city
permits.
Contracts actually awarded for construction work in
the Fifth District in June 1942, including rural as well as
urban projects, reached the unprecedented total of $160,508,000, according to figures compiled by the F. W. Dodge
Corporation. This total includes all additions to plant
facilities in industry, road and bridge work. Federal and
private housing projects, Government building of all
kinds, and port facilities such as docks and piers. Pub­
licly financed projects account for most of the amount, as
has been the case for a year or more. Contracts awarded
in the Fifth District in the first half of 1942 totaling
$583,990,000 exceed the value of contracts awarded in
the first half of 1941, totaling $373,513,000, by 56 per
cent.
Figures by states for contracts awarded in May 1942,
which were not available when the June 30 Review went
to press, were reported by the F. W. Dodge Corporationt
as follows:
CONSTRUCTION CONTRACTS AWARDED
STATES
May 1942
May 1941 % Change
Maryland .............................
$ 15,021,000
$ 15,974,000
— 6
Dist. of Col.............................
8,693,000
4,934,000
+76
Virginia .................................
24,341,000
13,151,000
+85
West Virginia ...................
3,629,000
4,669,000
—22
North Carolina.....................
10,130,000
42,686,000
— 76
South Carolina ..................... ................7,100,000_______ 18,591,000______ — 62
Fifth District ...... ...........
$ 68,914,000
$100,005,000
— 31

COTTON TEXTILES

The cotton textile industry continued operations at
approximate capacity during June, working for the most
part on war orders. Nearly all mills which have machin­
ery suitable for weaving medium and heavy goods have
converted to ducks, osnaburgs, sheetings, and other types
of material needed in the prosecution of the war, and
comparatively little cloth is being manufactured for civil­
ian use. However, jobbers and retailers bought large
stocks of textiles when they were available, and have con­
sequently been able to meet most of the needs of their
customers to this time. Stocks of many kinds of textiles
are being depleted steadily in stores, and the number of
items which can no longer be purchased is increasing.
With army and navy needs steadily increasing, textiles
available for civilian use are correspondingly decreasing.
Ceiling price regulations have, prevented any substantial
price rise in the face of shrinking supplies.
Cotton consumption figures by states in the Fifth Dis­




trict for June 1942 and the first six months of this year
are compared in the accompanying table with correspond­
ing figures for 1941.
COTTON CONSUMPTION— FIFTH DISTRICT
In bales
MONTHS
June
1942..............
May
1942..............
June
1941..............
6 Months, 1942.............
6 Months, 1941.............
% Increase in 1942

No. Carolina So. Carolina
247,142
189,444
241,904
188,998
215,790
157,443
1,453,021
1,115,268
1,279,304
965,444
14
16

Virginia District
21,986
458,572
22,094
452,996
19,246
392,479
132,316 2,700,605
107,576 2,352,324
23
15

RAYON

Rayon Organon for July states that deliveries of rayon
filament yarn to domestic consumers in June 1942 amount­
ed to 39,000,000 pounds, compared with 37,600,000 pounds
in May this year and 38,300,000 pounds in June 1941.
Production of yarn last month was less than total ship­
ments, and reserve stocks in manufacturers’ hands there­
fore declined from 6,900,000 pounds at the end of May to
5.800.000 pounds at the end of June. On June 30, 1941,
reserve stocks of yarn totaled 4,600,000 pounds. In the
first half of this year rayon yarn shipments totaled 231,400.000 pounds, an increase of 6 per cent over shipments
totaling 219,200,000 pounds in the corresponding period
last year.
Deliveries of rayon staple fiber during June totaled
13.600.000 pounds, compared with 12,600,000 pounds de­
livered in May and 12,400,000 pounds in June 1941, and
in the first half of this year deliveries of staple fiber total­
ing 75,600,000 pounds exceeded shipments of 64,300,000
pounds in the first six months of 1941 by 18 per cent.
American textile manufacturers are turning more and
more to rayon in staple fiber form, since it blends with
other materials more readily than filament yarn.
No official announcements on prices of dissolving pulp
for the third quarter of the year have been made, but it is
understood in the trade that prices will remain unchanged
for the period at $85 per 2 ,000-pound ton for base-grade
pulp and $10 0 per ton for the special grade pulp used by
the acetate division of the industry.
On June 22, the OPA issued Maximum Price Regula­
tion No. 167 establishing maximum prices for rayon yarn
and staple fiber, and simultaneously issued a companion
order, No. 168, setting ceiling prices for converted rayon
yarns and converting charges, both regulations to become
effective June 27. Regulation 167 is, in effect, only a
formalization of the prices which producers of rayon yarn
and staple fiber have observed at the request of the OPA
since October 1941.
COTTON STATISTICS

Spot cotton prices on 10 Southern markets rose during
the second half of June by more than $5.00 per bale, but
lost about half of the increase in the first half of July.
From an average of 18.62 cents per pound for middling
grade upland cotton on June 1 2 , the average rose to 19.88
cents on July 3, but by July 17, the latest date for which
official figures are available, the average dropped to 19.30
cents. On July 18, 1941, the average price on the 10
markets was 15.48 cents.
On July 8 the Department of Agriculture issued a
report on cotton acreage for 1942, in comparison with
acreage figures in 1941 and during the period 1931-1940.

MONTHLY REVIEW

The United States as a whole showed an increase in 1942
acreage over 1941 acreage amounting to 3.8 per cent. In
the Fifth District, Virginia with 44,000 acres is 22 per cent
above last year, North Carolina with 861,000 acres in­
creased 6 per cent this year, and South Carolina with
1,247,000 acres rose 1 per cent. No official report on the
condition of the growing crop has been released, but un­
official reports indicate that the prospects are good for at
least average yields throughout most of the belt, and
some sections are expecting considerably better than aver­
age yields if the weather is favorable during the balance
of the growing season.
COTTON CONSUMPTION AND
June
1942
Fifth district states:
458,572
Cotton consumed ..................
Cotton growing states:
831,550
Cotton consumed ..................
Cotton on hand June 30 in
1,934,113
Consuming establishments
8,100,603
Storage & compresses
United States:
966,940
Cotton consumed .................
Cotton on hand June 30 in
2,441,130
Consuming establishments
8,458,912
Storage & compresses........
Spindles active ............................. 23,090,560

ON HAND—BALES
Aug. l.to June 30
June
1941 This Year Last Year
392,479

4,778,411

4,004,613

743,295

8,660,982

7,496,493

875,812 10,169,448

8,791,921

1,524,593
10,175,849

1,920,197
10,574,730
22,994,980

..

...

TOBACCO MANUFACTURING

Cigarette production in June 1942 established a new
record and reached the twenty billion mark for the first
time. Output of all other tobacco products except smok­
ing and chewing tobacco also exceeded output in June last
year. Production figures released by the Bureau of In­
ternal Revenue are as follows:
June 1942
Smoking & chewing
tobacco, pounds ..............
Cigarettes, number ................
Cigars, number .....................
Snuff, pounds ..........................

24,579,958
20,003,674,760
532,390,210
3,226,884

May 1942

June 1941

21,956,402
18,455,318,320
457,767,155
3,224,368

24,729,260
18,522,764,920
478,802,003
2,930,255

RETAIL AND WHOLESALE TRADE

Richmond (5) .............
Baltimore (10).................
W ashington (7) .............
Other Cities (12).............

Department Store Trade
Percentage increase or decrease in sales, stocks,
outstanding orders and outstanding receivables in
June 1942 in comparison with June 1941 :
Receivables
Orders
Sales
Stocks
+ 60
— 8
+ 11 ( + 15) + 46
— 16
+ 14 (+ 2 2 ) + 68
+ 13
— 6
+ 16 ( + 27) + 78
0
— 16
+ 6 ( + 18) + 43
+
9
— 10
+ 12 (+ 2 1 ) + 66
+ 11

Same stores by states,
including stores reporting
sales only:
Maryland (13)...............
Virginia (16) ...............
West Virginia ( 1 5 ) ....
North Carolina (16) ___
South Carolina (11) ..

+ 14
11

+
—

10

( + 22)

( + 18)
( + 3)
( + 4)
20

+ 22 ( + )
—

2

* Includes stores reporting sales only.
Note: Second figure in parentheses under Sales compares combined sales
in 6 months of 1942 with sales in the first 6 months of 1941.
WHOLESALE TRADE, 207 FIRMS
Net Sales
Stocks
Ratio June
collections
June 1942
June 30, 1942
compared with
compared with
to accounts
June
May
June 30 May 31 outstanding
LINES
1941
1942
1941
1942
June 1
— 37
— 19
85
Auto supplies (8 )..........
+ 22
— 8
+ 46
65
Shoes (4) .......................
+ io
+ 22
— 4
106
Drugs & sundries (13)..
+ 5
+ 19
50
— 9
+ 50
Dry goods (7) ..............
+ 19
+ 5
— 8
57
Electrical goods (12) ..
+ 2
+ 18
+ 1
— 7
113
Groceries (66) ..............
+ 9
+ 2
+ 19
— 14
— 13
— 3
62
Hardware (12) ..............
+ 3
Industrial supplies (10).
— 3
— 17
0
- 3
92
- 3
+ 25
Paper & products (10).
77
+
6
+ 4
+ 12
+ 35
Tobacco & products (6)
— *4
81
Miscellaneous (59) . . . .
+ ‘5
+ 13
+ 4
District Average (207)
0
77
+ 15
+ 11
+ 1
Source: Department of Commerce




5
RETAIL FURNITURE SALES
% Changes in June 1942 Sales
Compared with Compared with
June 1941
May 1942

INDIVIDUAL CITIES
Baltimore, Md. (10)*...........
Washington, D. C. ( 8 ) * ...
Richmond, Va. (9)*..............
Danville, Va. (3)*..............
Norfolk, Va. (3)*................
Roanoke, Va. (3)*...............
Charleston, W. Va. (4 )*..
Charlotte, N. C. (5)*...........
Winston-Salem, N. C. (3)*.
Columbia, S. C. (4)*..........
Greenville, S. C. (4)*........
Other Cities (61)*..............
Fifth District (117)*.__

—

12

—

+ 5
— 28
— 55
—
2
— 40
— 37
— 47
— 40
— 37
—

—

—

22

0
— 26
— 5
— 12
— 13
— 33
20
— 25
-1 5

+

22

— 34
— 23

Same Stores, Grouped
By States:
Maryland (10)* ..................
Dist. of Col. ( 8 ) * .................
Virginia (39)* ...................
West Virginia (15)*.........
North Carolina (25)*.........
South Carolina (20)* .........
Fifth District (117)*
*Number of reporting stores.

11

— 9
— 7

12

—

+ 5

11

— 9

— 23
— 42
— 37

—

11

— 18
— 34
— 17
— 15

CROP FORECASTS

The following figures, issued by the Department of
Agriculture, show forecasts of production in 1942 based
on July 1 conditions, compared with final yields in 1941
and in the 10-year period 1930-39, and percentage changes
in acreage this year over or under 1941 acreage:
Wheat (Bushels)
% Change

Yield
1930-39
8.342.000
8.643.000
2.154.000
4.807.000
1.364.000
25,310,000

Yield
1941
7,245,000
7,665,000
1,628,000
7,110,000
3,146,000
26,794,000

Yield
1942
6,600,000
7,568,000
1,552,000
7,410,000
3,335,000
26,465,000

Oats (Bushels)
1.325.000
9
10
2.116.000
1.931.000
+ 4
4.460.000
+ 8
9.238.000
+ 6
19,070,000
+ 7

1,024,000
2,625,000
1,776,000
6,300,000
12,100,000
23,825,000

1,120,000
3,248,000
1,848,000
6,800,000
12,534,000
25,550,000

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

15,164,000
32,942,000
12,307,000
52,096,000
22,316,000
134,825,000

16,835,000
36,575,000
12,840,000
46,596,000
22,442,000
135,288,000

Hay (Tons)
467.000
924.000
642.000
744.000
+ 5
10
398.000
3,175,000
+ 5

472,000
1,250,000
793,000
1,071,000
470,000
4,056,000

519,000
1,364,000
875,000
1,208,000
524,000
4,490,000

Irish Potatoes (Bushels)
0
2.997.000
1,920,000
— 4
10,661,000
6,916,000
+ 9
2.844.000
3,795,000
8.182.000
+ 5
6,636,000
2,475,000
+ 8
2,548,000
27,159,000
+ 3
21,815,000

2,200,000
8,030,000
4,140,000
8,632,000
3,108,000
26,110,000

Acreage
Maryland ........
Virginia ............
West Virginia .
North Carolina
South Carolina
District Total
Maryland ........
Virginia ............
West Virginia .,
North Carolina .
South Carolina
District Total

11

—

— 7
—

8

+

4

+ 20
—1
+

+

Com
2
5
6
4
3
1

Maryland ...............
Virginia ...............
West Virginia . . .
North Carolina . . .
South Carolina . ..
District Total . ..
Maryland ..........
Virginia ...........
West Virginia . . .
North Carolina .
South Carolina .
District Total
Maryland ........
Virginia ............
West Virginia
North Carolina
South Carolina
District Total

1

—

+ 5
+ 3

+

)
Maryland ........
Virginia ..........
North Carolina
South Carolina
District Total

- 10
+ 13
—
1

1.071.000
4.061.000
8.354.000
5.401.000
18.887.000

1,040,000
2,970,000
6,880,000
4,400,000
15,290,000

1,530,000
4,000,000
7,848,000
5,890,000
19,268,000

Maryland ........
Virginia ..........
West Virginia
North Carolina
South Carolina
District Total

Tobacco (Pounds)
26.901.000
3
10
99.861.000
2,985,000
+ 14
529.366.000
11
85.656.000
11
10 744.759.000

30,225,000
88,572,000
2,610,000
459,490,000
69,660,000
650,557,000

31,125,000
96,180,000
3,052,000
513,910,000
90,000,000
734,267,000

Peaches (Bushels)
372.000
899.000
285.000
1.938.000
1.424.000
4.918.000

563,000
1,860,000
590,000
3,167,000
4,095,000
10,275,000

544,000
1,840,000
560,000
2,320,000
3,800,000
9,064,000

Maryland ........
Virginia ..........
West Virginia
North Carolina
South Carolina
District Total

(Compiled July 21, 1942)

+ 13
- 3

+

+
+
+
+

6

MONTHLY REVIEW

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

I N D U S T R IA L

P R O D U C T IO N

Industrial activity continued to advance during June and the first half of
July. Volume of goods distributed to consumers continued substantially below
a year ago and commodity prices generally showed little change.
PRODUCTION

Federal Reserve monthly index of physical vol­
ume of production, adjusted for seasonal varia­
tion, 1935-39 average = 100. Latest figures shown
are for June 1942.
COST

O F L IV IN G

Industrial output increased further in June and the Board’s seasonally ad­
justed index rose from 174 to 177 per cent o f the 1935-39 average. Production in
the machinery, transportation equipment, and other armament industries con­
tinued to advance, reflecting further progress toward meeting the requirements of
the war production program. Steel production declined somewhat in June but
increased to earlier high levels in the first three weeks of July. Lumber produc­
tion increased seasonally in June, while in the furniture industry, where activity
usually rises at this time of year, there was a decline, reflecting in part the fact
that a number of plants in the industry are being converted to the manufacture of
war products.
In industries manufacturing nondurable goods, output as a whole showed
little change from May to June. Textile production declined somewhat, reflecting
a reduction in activity at cotton mills from earlier peak levels. Paperboard pro­
duction decreased sharply further and there was also a decline in activity in the
printing industry. On the other hand, output of manufactured food products in­
creased and shoe production showed less than the customary seasonal decline.
Mineral production continued large in June. Coal production was main­
tained at peak levels; output of crude petroleum showed little change, following
the sharp decline that occurred during March and April. Lake shipments of iron
ore in June amounted to 12,600,000 gross tons and at the month end stocks at lower
Lake ports totaled 31,000,000 tons as compared with 26,600,000 tons a year ago.
Value of construction contracts awarded, as reported by the F. W. Dodge Cor­
poration, continued to increase in June and was 57 per cent above the previous
record high month of August 1941. The sharp rise in June reflected a continued
increase in awards for public projects, which accounted for about 93 per cent of
all contracts let during the month.
DISTRIBUTION

Bureau of Labor Statistics’ indexes, 1935-39
average = 100. Fifteenth of month figures. Last
month in each calendar quarter through Sept.
1940, monthly thereafter. Latest figures shown
are for June 1942.
M E M B E R B A N K S IN 101 L EAD IN G C IT IE S
WLUdlt O* DOLLARS

Distribution of commodities to consumers declined somewhat further in June.
Smaller sales were reported by both department stores and mail-order houses,
while sales at variety stores were maintained at about the May rate. In the first
half of July department store sales showed less than the customary sharp sea­
sonal decline.
Volume of railroad freight traffic was maintained in large volume during
June and the first half of July. The number of cars loaded was below the level
that prevailed a year ago, however, reflecting a sharp reduction in carloadings in
less-than-carload lots as a result of orders by the Coordinator of Transportation
which raised the minimum permissible weights for such loadings and thereby
effected a fuller utilization of existing equipment.
COMMODITY PRICES

1936

1937

1938

1939

1940

194!

1942

Wednesday figures. Commercial loans, which
include industrial and agricultural loans, repre­
sent prior to May 19, 1937 so-called “ Other loans”
as then reported. Latest figures shown are for
July 15, 1942.
EXCESS

1936

1937

RESERVES

1938

OF M EM B E R

1939

1940

BANKS

1941

Wednesday figures, partly estimated.
figures shown are for July 15, 1942.




1942

Latest

Prices of most commodities both at wholesale and retail continued to show
little change from the middle of June to the middle of July. Prices of cotton,
wool, and some other agricultural commodities, which had declined in the early
part of June, advanced in this period.
About twenty additional maximum price schedules were announced covering
a wide variety of products and in some cases requiring price reductions. On the
other hand, Federal approval was given for higher prices on various processed
fruits and vegetables, textile products, petroleum products sold on the East Coast,
and services supplied to consumers.
Retail prices of uncontrolled foods advanced sharply from May to June and
the Bureau of Labor Statistics price index for all foods rose 1 1/2 points to 123
per cent of the 1935-39 average— an increase of one-fourth since the beginning
of the current advance in March 1941.
BANK CREDIT

Member banks in leading cities increased their holdings of Government secu­
rities sharply during the first half of July. Purchases included portions of in­
creased Treasury bill issues and of the new 2 per cent 7- to 9-year bond. This
followed a substantial growth in the second quarter of the year when member
banks absorbed about 3.3 billion dollars, or more than half of the increase in
Treasury open-market issues. All classes of banks showed large increases, the
largest percentage increases being in Chicago and at reserve city banks.
Excess reserves of member banks have been at a lower level in July than in
June, because of increased need for reserves arising out of deposit growth, the
continued currency drain, and a large temporary increase in Treasury deposits
at Reserve Banks. Substantial System open-market operations partially offset
the loss of reserves from these sources. The decrease in excess reserves was
concentrated in New York and Chicago, reducing excess funds in those cities to
low levels. Adjusted demand deposits continued to rise at reporting banks in
leading cities except in New York.
Yields on United States Government securities and other money rates have
shown little change in recent weeks.