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MONTHLY

REVIEW

BUSINESS AND AGRICULTURAL CONDITIONS

WILLIAM W. H O X T O N . CHAIRMAN AND FEDERAL RESERVE AGENT

R IC H M O N D , V IR G IN IA
DISTRICT SUMMARY. U nseasonably cool
w eather in most of the fifth reserve district dur­
ing M ay and the first half of June so delayed
crop developm ent and so retarded retail trade
that at the middle of June it is difficult to an­
alyze the current business situation. Elem ents
of strength and w eakness are both present, but
on the whole the general outlook appears to be
som ewhat less favorable than at the same time
a year ago. Credit demands declined seasonally
during the period betw een the middle of M ay
and the middle of ’June, and bank deposits rose
at reporting member banks. Debits to individ­
ual accounts figures in fourteen of tw enty-th ree
leading cities of the fifth district w ere higher
during the four w eeks ended June 8th than dur­
ing the corresponding four w eeks in 1926, but
the district total w as low er during the 1927
period, due to a large decrease in Baltim ore.
The strike in union bituminous coal fields has
increased demand for W est V irgin ia coal, and
the textile situation in the district is much b et­
ter than it w as a year ago, but at the same time
business failures are running ahead of 1926 in
both number of defaults and in liabilities in­
volved, and during each of the past eight months
the volum e of building construction provided for
in permits issued in tw enty-nine leading cities
was considerably below that provided for in per­
mits issued during the corresponding months of
the preceding year. Labor is not as w ell em ­
ployed as a year ago, and this is being reflected
in retail trade, w hich in M ay w as in smaller
volum e than in M ay 1926. T o tal sales during
the first five months of 1927 w ere also less than
those of the first five months in 1926. W holesale
trade is not better than fair. A gricultural pros­
pects are highly uncertain at this time. The
w eather has been too dry in some sections and
too w et in others, and throughout the entire dis­
trict tem peratures have been so unseasonably
low that plant g ro w th has been seriously re­
tarded. Conditions up to the present time have
been favorable for the cotton crop in the fifth
district, and on the whole the small grain crops
are good, but fruit prospects are probably not
better than 50 per cent of last year's, corn is late
and much replanting has been necessary, and to ­
bacco is too young to allow conclusions to be

drawn
http://fraser.stlouisfed.org/ in reference to its prospects.
Federal Reserve Bank of St. Louis

JU N E 30, 1927
RESERVE BANK OPERATIONS. The peak
of credit demand for crop planting and fertilizer
purchasing having passed, credit needs eased b e­
tw een M ay 15th and June 15th, in keeping w ith
the seasonal trend. Rediscounts held by the F ed ­
eral Reserve Bank of Richmond declined from
$27,977,000 on M ay 15th to $19,590,000 on June
15th, and the volum e of Federal reserve notes
in actual circulation dropped from $66,571,000 to
$61,880,000 during the same period. T otal bill
holdings of the Federal R eserve B ank of R ich ­
mond declined from $38,173,000 on M ay 15th to
$27,919,000 on June 15th, the decrease being
made up of reductions of approxim ately $8,250,000 in rediscounts held and $2,000,000 in bills
purchased in the open m arket and from member
banks. M ember bank reserve deposits at the re­
serve bank rose from $67,878,000 to $70,888,000
betw een the middle of M ay and the middle of
June. The several changes in the statement,
w ith others of less importance, increased the to ­
tal cash reserves held by the Federal R eserve
Bank of Richmond from $97,010,000 on M ay 15th
to $98,738,000 on June 15th, and raised the ratio
of reserves to note and deposit liabilities com ­
bined from 70.76 per cent to 74.11 per cent.
On June 15, 1927, reserve bank credit w as in
relatively little demand. A year earlier, member
banks w ere borrow ing $45,576,000 from the F ed ­
eral R eserve Bank of Richmond, but on June
15th this year this amount had declined to $19,590,000, a decrease of 57 per cent. T otal bill
holdings of the Richmond bank declined during
the year from $57,590,000 to $27,919,000, a de­
crease of 51.5 per cent. Federal reserve notes in
actual circulation, which totaled $71,989,000 on
June 15th last year, declined to $61,880,000 on
June 15th this year, a drop of 14 per cent. On
the other hand, member banks increased their
reserve deposits from $65,045,000 on June 15,
1926, to $70,888,000 on June 15, 1927, a rise of
approxim ately 9 per cent. A s a result of the
low er credit needs of member banks this year,
the cash reserves of the Federal R eserve Bank of
Richmond rose from $76,709,000 at the middle of
June last year to $98,738,000 on the correspond­
ing date this year, an increase of 28.7 per cent.
The ratio of cash reserves to note and deposit
liabilities combined, which stood at 55.58 per
cent on June 15, 1926, rose to 74.11 per cent on
June 15, 1927.

CONDITION OF SIXTY-SEVEN REPORTING MEMBER BANKS IN SELECTED CITIES
ITEMS

June 15, 1927

1. Total Loans and Discounts (including
all rediscounts) ......................................
2. Total Investments in Bonds and Secu­
rities ...........................................................
3. Reserve Balance with Federal Reserve
Bank ...........................................................
4. Cash in Vaults..............................................
5. Demand Deposits ........................................
6. Time Deposits..............................................
7. Borrowed from Federal Reserve Bank...

May 11, 1927

June 16, 1926

$520,040,000

$513,136,000

$516,144,000

146.033.000

145.920.000

132.815.000

42,520,000
13*038,000
385.965.000
225.567.000
4,774,000

40.821.000
13.958.000
381.159.000
221.992.000
6,993,000

39.742.000
13.547.000
365.036.000
207.321.000
15.346.000

The accom panying table shows the principal items of condition reported by sixty-seven iden­
tical member banks, located in thirteen leading fifth district cities, on three dates, June 15th
and M ay n th , this year, and June 16th last year, thus affording an opportunity for comparison
of the latest available figures w ith those of the preceding month and the preceding year.
B etw een the middle of M ay and the middle of June, credit needs in agricultural sections of
the fifth district usually lessen to some extent, crops being previously planted, fertilizer purchased,
and sales of truck putting some money into the hands of the farm ers. This enables the country
banks to reduce their borrow ing from the reserve bank or from their city correspondents. A ll of
these developments occurred betw een M ay n t h and June 15th this year. Outstanding loans to
custom ers of the reporting member banks increased slightly during the month, rising by $6,904,000,
but investm ents in bonds and securities rose $113,000, aggregate reserve balances of the reporting
banks at the reserve bank increased $1,699,000, and total deposits gained $8,381,000, of. which $4,806.000 was in demand and $3,575,000 in time deposits. Cash in vaults declined $920,000 during
the month under review , and the sixty-seven banks reduced their rediscounts at the reserve b ark
by $2,219,000.
Comparing the figures for June 15, 1927, w ith those reported on June 16, 1926, total loans ana
discounts to custom ers of the reporting banks show an increase during the year of $3,896,000. In ­
vestm ents in bonds and securities rose $13,218,000 during the year, and reserve balances at the re­
serve bank gained $2,778,000. Cash in vaults declined $509,000, but demand deposits increased $20,929.000 and time deposits rose $18,346,000, a total deposit gain of $39,175,000. The reporting banks
reduced their rediscounts at the reserve bank from $15,346,000 on June 16th last year to $4,774,000
on June 15th this year, a decline of $10,572,00, or 68.9 per cent during the year.

DEBITS TO INDIVIDUAL ACCOUNTS
TOTAL DEBITS DURING THE FOUR WEEKS ENDED
CITIES

June 8, 1927

May 11, 1927

June 9, 1926

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..........................................................
Raleigh, N. C......................................................
Richmond, Va......................................................
Roanoke, Va........................................................
Spartanburg, S. C.............................................
Washington, D. C...............................................
Wilmington, N. C..............................................
Winston-Salem, N. C.........................................

$

$

$

District Totals ..................................................

$1,203,160,000

37,567,000
353.269.000
24.255.000
34.322.000
49.063.000
23.914.000
8.505.000
7.595.000
25.898.000
23.187.000
20.113.000
9.976.000
21.633.000
18.036.000
8.596.000
68.956.000
19.188.000
118.446.000
26.685.000
13.012.000
237.480.000
17.953.000
35.511.000

31,680,000
375.385.000
26.765.000
31.759.000
50.031.000
24.930.000
8.848.000
7.972.000
28.424.000
26.346.000
22.193.000
10.244.000
22.278.000
18.087.000
9.150.000
68.667.000
19.685.000
123.454.000
25.853.000
12.460.000
236.205.000
19.540.000
41.526.000

$1,241,482,000

36,653,000
393.350.000
25.117.000
33.094.000
45.227.000
18.414.000
7.941.000
7.570.000
24.408.000
23.536.000
16.803.000
9.153.000
22.939.000
19.025.000
9.475.000
68.626.000
18.907.000
115.358.000
27.359.000
13.493.000
231.961.000
18.729.000
33.390.000

$1,220,528,000

Debits to individual, firm and corporation accounts in the clearing house banks of tw enty-three
leading fifth district cities totaled $1,203,160,000 for the four w eeks ended June 8, 1927, a decline of



2

3-i per cent under the total of $1,241,482,000 reported by the same banks for the preceding four w eeks,
ended M ay n th . This decrease w as chiefly seasonal and was due to the occurrence of holidays dur­
ing the period ended June 8th. Seventeen cities reported low er figures for the later period, but larger
totals w ere reported by Asheville, Charleston, W . Va., N orfolk, Roanoke, Spartansburg and W ash ing­
ton.
A comparison of $1,203,160,000 reported for the four w eeks ended June 8th this year w ith $1,220,528,000 reported for the corresponding period a year ago shows a district decline of 1.4 per cent,
but a m ajority of the reporting cities show higher figures this year, the average decline being due
chiefly to a decrease of 10.1 per cent in Baltim ore's debits. Fourteen cities reported higher figures
for the 1927 period, while nine cities reported low er totals. A s previously mentioned, B altim ore’s
figures this year w ere below those of the 1926 period, but the next three cities, W ashington, R ich ­
mond and N orfolk, reported higher figures this year.

SAVINGS DEPOSITS— Savings deposits in the fifth district increased during the past month.
Thirteen mutual savings banks in Baltim ore had deposits a g g rega tin g $165,558,711 at the close of busi­
ness M ay 31, 1927, compared w ith $165,482,800 at the end of April this year and $154,228,991 at the
end of M ay 1926. S ixty-seven regu larly reporting member banks had a g g reg a te time deposits
am ounting to $225,267,000 on June 15th this year, compared w ith $221,992,000 on M ay n , 1927, and
$207,321,000 on June 16, 1926.
BUSINESS FAILURES— Dun's Review for June 4, 1927, says, “ The reduction in the number of
commercial failures in the United States which has been in progress since the end of last January,
follow ing the usual trend, continued during M ay. W ith 1,852 defaults, last m onth’s total is 6 per cent
below that for A pril, and is approxim ately 25 per cent under the number for January, which, as previ­
ously indicated, m arked the high point for this year. W hen comparison is made w ith the returns
for M ay of the tw o im m ediately preceding years, how ever, increases are shown. The rise over the
I,730 insolvencies of a year ago is a little more than 7 per cent, while there is an increase of 4.8 per
cent over the 1,767 failures of M ay 1925. The falling off from A pril to M ay last year w as about
II.5 per cent, and tw o years ago it w as approxim ately 9 per cent. Hence, the present record is less
favorable, both actually and relatively, than that for M ay 1926 and 1925. Y e t it is not strik in gly ad­
verse, considering recent factors which m ight conceivably have brought about a distinctly higher
comm ercial m ortality, such as floods and inclem ent w eather, and it also is to be remem bered that
the larger number of firms and individuals in business enhances the possibilities of failure.
“ The liabilities of the M ay defaults— $37,784,773— show decided im provem ent over the large
amounts of recent months. The decrease from the A pril total is some 29 per cent, while there is an
even greater contraction from the indebtedness for March. O11 the other hand, last m onth’s liabil­
ities exceed by about 12.5 per cent the $33,543,318 of M ay 1926. A n interesting feature of the statis­
tics is the fact that approxim ately 46 per cent of last m onth’s indebtedness w as supplied by defaults
for $100,000 or more in each instance, which is a low er ratio than the 49 per cent provided by the
similar class of failures in M ay 1926.”
In the fifth reserve district, M ay failures totaled 125, compared w ith 123 in A pril this year and
118 in M ay last year, while liabilities last month a ggregated $5,707,404, compared w ith $3,800,752 in
A pril 1927 and only $1,963,570 in M ay 1926. L ast m onth’s liabilities w ere the largest for any month
since M ay 1925, and in fact have been exceeded only four months since the W orld W ar.
LABOR— No changes of importance w ere noted in labor circles during the past month. A re­
duced building program this year in comparison w ith the tw o or three m ost recent years has resulted
in some unemployment in the building trades and allied lines, but other em ployers are using their full
quotas of w orkers. Tobacco factories in the fifth district are expanding operations in m any cases,
the coal strike in union bituminous fields has increased demand for W est V irgin ia coal and has given
miners in that state steadier w ork than is usual at this season of the year, road and street w ork is
using a large number of both skilled and unskilled laborers, and shipyards are busy. T ex tile mills are
operating full time, and em ploying full quotas of employees. The volum e of construction w ork under
w ay, while less than a year ago, is still large, and is givin g em ployment to the bulk of skilled trades­
men. In the cities there is some unemployment, but the situation is not general nor serious.
COAL— In spite of the strike of union miners in bituminous coal fields, production of soft coal in
M ay totaled approxim ately 35,393,000 net tons, according to the June n t h report of the Bureau of
Mines, D epartm ent of Commerce. This output exceeded that of A pril by approxim ately 2 per cent,
and w as only 9.4 per cent under the production of M ay 1926, when there w ere no men out on strike.
W est V irgin ia mines are producing close to 3,000,000 tons per w eek at present. Retailers have coal
in their yards in sufficient quantities to fill all orders promptly, and retail prices are down to w ithin
about 50 cents per ton of prices a year ago. A nth racite coal is now available at all yards, the short­
age of last year having been made up by the mines. H ow ever, relatively little anthracite is used in
the fifth district.



3

TEXTILES— Cotton consumed in fifth district mills in M ay totaled 264,507 bales, of which N orth
Carolina mills used 144,736 bales, South Carolina m ills 107,912 bales, and V irgin ia mills 11,859 bales.
M ay consumption in the district exceeded 259,754 bales used in A pril 1927 and 209,204 bales used in
M ay 1926. F ifth district mills are running full tim e on forw ard orders, and are accum ulating little
stock in their w arehouses. Orders are more easily obtained than for m any months, but textile
executives state that the business is being done on a very narrow m argin and that profits are small.
The general situation in the industry is very much better than it w as at this time last year, when
mills w ere forced to curtail operations m aterially to prevent the accum ulation of m anufactured goods.
BUILDING OPERATIONS FOR THE MONTHS OF MAY 1927 AND 1926.
Permits Issued

0

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29

New

CITIES

2

Winston-Salem, N. C.

Charleston, S. C ...
Columbia, S. C.....
Greenville, S. C.....
Spartanburg, S. C.
Washington, D. C.

478
28
5
28
16
32
80
5
103
70
18
35
45
40
34
28
67
29
58
60
34
23
17
123
16
18
11
33
187

Alterations

Repairs

1927 1926
Baltimore, Md......
Cumberland, Md...
Frederick, Md......
Hagerstown, Md...
Danville Va..........
Lynchburg, Va....
Norfolk, Va.
...
Petersburg, Va.....
Richmond, Va......
Roanoke, V a .......
Bluefield, W. Va...
Charleston, W. Va.
Clarksburg, W. Va
Huntington, W.V a.
Parkersburg,W.V a
Asheville, N. C.....
Charlotte, N. C.....
Durham, N. C......
Greensboro, N. C.
High Point, N. C...
Raleigh, N. C.......
Salisbury, N. C.....
Wilmington, N. C.

New Construction

1927

1926

1926

1927

598 1,432 1,403 $ 2,981,040 $ 4,209,600
33
4
15
203,802
62,353
11
2
1
18,285
196,765
4
26
25
31,470
32,925
11
13
35
17,065
59,435
32
30
43
89,296
78,434
62
93
65
306,275
242,320
7
3
5
16,850
30,550
88
153
83
798,579
544,016
121
32
59
209,282
722,380
24
12
7
94,505
50,950
55
20
18
81,327
101,752
23
18
16
38,495
25,275
92
4
7
272,380
69,948
42
5
4
148,850
147,750
102
78
68
577,924
275,220
76
28
i’8
760,599
256,975
40
10
26
225,915
579,150
57
44
43
139,536
290,220
83
13
15
221,050
327,720
41
15
12
637,425
114,250
23
10
7
107,500
98,745
9
10
5
28,700
17,200
89
31
53
568,945
410,190
8
24
25
87,700
18,373
12
38
30
25,500
120,450
18
32
28
107,750
48,305
26
31
30
63,460
62,750
274
508
382 3,251,610
4,323,670

Totals.......... 1,711 2,153 2,627 2,518 $10,347,903 $15,280,883

1927

1926

$ 792,840 $
4,600
900
1,225
7,230
34,782
527,880
8,760
65,173
13,307
23,525
23,475
13,005
1,150
3,500
42,718
59,685
13,190
96,531
11,975
26,225
11,950
^5,350
45,440
19,555
5,870
25,375
*(6,668
271,115
$2,162,999

674,760
13,165
1,100
129,235
17,546
32,162
31,601
6,141
72,415
10,326
3,950
7,497
11,800
11,090
1,950
15,014
10,300
37,885
128,825
9,750
18,954
15,190
6,700
38,260
107,510
11,795
48,285
16,105
936,585

Increase or Per Cent
Decrease
of
of
Increase
Total
or
Z
Valuation Decrease
$—1,110,480
— 150,014
— 178,680
— 129,465
— 52,686
—
8,242
560,234
— 11,081
— 261,805
— 510,117
63,130
—
4,447
14,425
— 212,372
2,650
— 275,000
— 454,239
— 377,930
118,390
— 104,445
— 515,904
5,515
10,150
165,935
— 157,282
89,025
36,535
— 10,147
—1,737,530

— 22.7%
— 69.1

— 90.3
— 79.8
— 68.4
— 6.8
204.5
— 30.2
— 30.1
— 69.6
115.0
— 4.1
38.9
— 74.9
1.8
— 46.4
— 58.9
— 61.2
44.1
— 30.9
— 78.6
4.8
42.5
37.0
— 80.6
238.7
37.8
— 12.8
— 33.0

1
2
3

4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29

$2,425,896 —$ 5,195,877 — 29.3°?o

— Denotes decrease.
NOTE— The figures in the above table reflect the amount of work provided for in the corporation limits of the
several cities, but take no account of suburban developments.

For the eighth consecutive month, the value of construction w ork provided for in perm its issued
by building inspectors in tw enty-nine fifth district cities w as low er in M ay than in the corresponding
month of the preceding year. Perm its issued for new construction in the tw enty-nine cities totaled
1,711 last month, compared w ith 2,153 permits for new w ork issued in M ay 1926. Valuation figures
also m ake an unfavorable comparison, $10,347,903 in M ay 1927 com paring w ith $15,280,883 in M ay
1926, both figures covering estim ates for new construction. In alteration and repair wrork, 2,627
perm its issued last month exceed 2,518 perm its fo r this class of w ork in M ay last year, but M ay
1927 valuation figures of $2,162,999 are below $2,425,896 reported a year ago. In combined valua­
tion for both new and repair or alteration w ork, the tw enty-nine cities totaled $12,510,902 last month
and $17,706,779 in M ay a year ago, a decrease during the 1927 month of $5,195,877, or 29.3 per cent.
Nineteen of the reporting cities showed low er valuation figures this year, w hile ten cities reported
higher figures last month. Four of the ten cities reporting gains are in N orth Carolina, three are in
W est Virginia, tw o in South Carolina, and one in V irginia. The three largest cities in the district re­
ported low er 1927 figures, but N orfolk, fourth c ity in size in the district, showed an increase over
M ay 1926 totals.
Building contracts awarded in the fifth district in M ay totaled $39,735,738, including both urban
and rural construction. O f this amount, $10,315,313 w as for residential wrork, according to statistics
collected by the F. W . D odge Corporation.



4

COTTON— The factors mentioned a month ago as tending to raise cotton prices continued to
operate during the period betw een the middle of M ay and the middle of June, and spot cotton prices
in the Carolinas rose over a cent a pound. In our M ay 31st Review, w e quoted 14.50 cents per pound
as the average price paid on Carolina m arkets during the w eek ended M ay 14th. From this price
there w as a gradual rise to 15.66 cents per pound during the w eek ended June n th . The floods along
the M ississippi, retarded developm ent of grow in g cotton by unseasonably cool w eather in eastern
states, lack of rain in some w estern and southw estern sections, and a continuation of large consump­
tion and export figures are the chief influences at w ork on cotton prices at present.
Cotton consumed in Am erican mills during M ay 1927 totaled 633,024 bales, compared w ith 619,140
bales consumed in A pril this year and 516,376 bales used in M ay 1926. The M ay consumption figure
w as the third highest on record for a single month. T otal consumption for the ten months of the sea­
son to date— A u gu st 1, 1926, to M ay 31, 1927— amounted to 5,970,844 bales, compared w ith 5,475,502
bales consumed during the corresponding period ended M ay 31, 1926. A ccording to the Bureau of the
Census report of June 14th, consum ing establishm ents held 1,794,284 bales of cotton in their w are­
houses on M ay 31st, compared w ith 1,448,739 bales so held on the corresponding date a year earlier.
Public w arehouses and com presses held 2,868,947 bales in storage on M ay 31st, compared w ith 2,965,477 bales a year ago. E xports totaled 628,132 bales in M ay this year, compared w ith 419,459 bales
shipped abroad during the same month of 1926, and total exports for the ten months ended M ay 31st
amounted to $10,312,637 bales against 7,442,315 bales exported during the ten months ended M ay 31,
1926. Im ports last month totaled 21,347 bales, compared w ith 13,625 bales brought in during M ay last
year. The cotton g ro w in g states consumed 456,285 bales in M ay this year, or 72.1 per cent of
National consumption, compared w ith 362,987 bales, or 70.3 per cent of National consumption, used
in cotton gro w in g states during M ay 1926.
A lthough it is too early to form an opinion as to this y e a r’s cotton crop, present indications point
to better prospects in the fifth district than existed a year ago or than now exist over the cotton
gro w in g belt as a whole. The floods along the Mississippi, together w ith unfavorable w eather for
planting and g ro w in g over much of the cotton belt, appear to indicate a very strong probability of
considerably reduced yields from those of 1926. In the fifth district, how ever, the cotton crop on the
whole is better than it was at this time a year ago, especially in the heavy producing Piedm ont
counties of the Carolinas. E arly in the season the w eather in the Carolinas w as dry, but general
rains fell when it w as really needed, and the crop has made splendid progress. The boll w eavil has
appeared in southern and eastern counties of South Carolina, and the cotton flea is in the fields in
the Piedmont, but tim ely w arning has been given of the danger from these pests and it is not certain
that they will do m aterial damage. The farm ers should realize that these insects are a very real
danger, how ever, and every effort should be made to control them.

AGRICULTURAL NOTES— The agricultural outlook in the fifth reserve district is rather more
difficult to estim ate at present than in most years at this season because unseasonable w eather has
retarded crop development. In the southern half of this district, em bracing the Carolinas, insufficient
rain fell during A pril and the first half of M ay, and several cool spells also checked grow th , w hile in
the northern half of the district the w eather has been entirely too cold for youn g crops. The C aro­
linas had general rains early in June, how ever, and crops are now m aking good progress. The g re a t­
est dam age from unfavorable w eather w as done to fruit crops, in w hich late frosts and cold in A pril
and early M ay lowered prospects far below those of last year. On the w hole, present indications are
for a fruit crop not more than half that of 1926, although a definite opinion cannot be form ed until
after the June drop occurs. N ational crops are also indicated to be unusually small and m ay result
in higher prices for peaches and apples next Fall than in 1926 and offset in part the reduction in yield.
In M aryland dry w eather early in June favored w heat, and a fair crop is in prospect, but corn is m ak­
ing slow grow th. W ildfire dam aged some tobacco plant beds, but the disease has been checked.
Tobacco plants in the fields need warm weather. In V irginia prospects for small grains are about
up to the average for the past five years, and the condition of hay and pastures is better than usual.
E arly truck crops made only fair yields but prices w ere good. The early w hite potato crop in V ir ­
ginia is good, and prices are also satisfactory. The corn crop is very poor at present. Considerable
replanting of corn, peanuts and tobacco has been necessary because of poor germ ination and injury
from cut worm s. N orth Carolina w heat and hay prospects are below those of a year ago, but the
oat crop is better this year. The early Irish potato yield was cut b y dry w eather, and some fields
that w ere dug late suffered from second grow th follow ing rains which fell around the first of June.
Sm all grain prospects in South Carolina are below those of last year, but are about up to average,
1926 having been an exceptionally good year for wheat, oats, etc., in that State.



5

FIGURES ON RETAIL TRADE

________________ As Indicated By Reports from Thirty Representative Department Stores for the Month of May, 1927___________
Percentage increase in May 1927 sales, over sales in May 1926:
Baltimore

Richmond

Washington

Other Cities

District

— 6.4
.3
— 3.5
2.7
— 3.7
Percentage increase in total sales since January 1st, over sales during the same five months in 1926:
— 3.2
4.4
— 1.5
— 1.4
— 1.7
Percentage increase in May 1927 sales over average May sales during the three years 1923-1925, inclusive :
— 3.0
13.8
10.5
11.4
4.5
Percentage increase in stock on hand May 31, 1927, over stock on May 31, 1926:
— 2.6
— .5
.6
4.3
— .5
Percentage increase in stock on hand May 31, 1927, over stock on April 30, 1927:
— 1.8
.3
— 3.4
— 5.0
— 2.6
Percentage of sales in May 1927 to average stock carried during that month:
25.4
26.4
28.1
23.4
26.2
Percentage of total sales since January 1st to average stock carried during each of the five elapsed months *
.
125.4
133.0
133.6
105.1
126.7
Percentage of outstanding orders on May 31st to total purchases of goods in 1926:
3.8
3.4
5.2
3.7
4.3
Percentage of collections in May 1927 to total accounts receivable on May 1st:
23.6
28.0
29.9
31.5
26.6
— Denotes decreased percentage.

Confidential reports sent to the Federal R eserve Bank of Richmond by th irty leading department
stores in the fifth reserve district show sales during M ay 1927 averagin g 3.7 per cent below the
volum e of sales in M ay 1926, tw en ty of the thirty stores reporting low er figures last month. In
total sales from January 1st through M ay 31st this year, sales in the reporting stores averaged 1.7
per cent below a gg re g a te sales during the first five months of 1926. On the other hand, M ay sales
this year averaged 4.5 per cent above average M ay sales during the three years 1923-1925, inclusive.
Unseasonably cool w eather probably reduced the volum e of trade in M ay to a considerable extent, and
partly accounted for the decline in sales in comparison w ith the corresponding month of 1926.
Stocks of merchandise on the shelves of the reporting stores w ere five-tenths of 1 per cent low er
in selling value at the end of M ay 1927 than a y ear earlier, and w ere 2.6 per cent smaller than a
month earlier. The decrease in M ay under the A p ril 30th figure w as about the seasonal average.
The perecentage of sales to average stocks carried during M ay w as 26.2 per cent for the district
as a whole, and the percentage of total sales during the first five months of this year to average
stocks carried during each of the five months w as 126.7 Per cent, indicating an annual turnover of
3.041 times. D uring the first five months of 1926 the turnover was at a rate of 3.072 times.
Collections by tw enty-nine of the th irty reporting stores during M ay totaled 26.6 per cent of out­
standing receivables as of M ay 1st, exactly the same average attained in A pril this year, but a low er
figure than the average of 29.3 per cent collected in M ay 1926. A ll cities except Richmond reported
low er percentages in M ay than in M ay a year ago, and Baltim ore and the O ther Cities group also
showed declines in collections from those of A p ril this year. Richmond and W ashington collections
improved slightly last month in comparison w ith A pril.




6

WHOLESALE TRADE, MAY 1927
Percentage increase in May 1927 sales, compared with sales in May 1926:
34 Groceries
12 D ry Goods
6 Shoes
16 Hardware
5 Furniture
13 Drugs
— 3.1
— 7.4
— 11.5
10.4
25.5
1.7
Percentage increase in May 1927 sales, compared with sales in April, 1927:
6.5
— 5.8
— 8.9
.6
53.6
— 3.8
Percentage increase in total sales since Jan. 1, 1927, compared with sales during the same five months in 1926:
— 6.5
— 3.1
.4
4.9
— 5.2
— 2.9
Percentage increase in stock on May 31, 1927, compared with stock on May 31, 1926:
4.5(11)
— 7.2(5)
15.3(4)
— 5.6(7)
Percentage increase in stock on May 31, 1927, compared with stock on April 30, 1927:
— 1.0(11)
3.2(5)
— 7.9(4)
— 3.9(8)
Percentage of collections in May to total accounts receivable on May 1, 1927:
66.8(21)
31.6(8)
33.4(5)
35.0(12)
35.6(3)
58.0(8)
—•Denotes decreased percentage.
NOTE: The number of firms reporting stock and collection data in each group is shown immediately fol­
lowing the percentages.

E ig h ty-six w holesale firms, representing six im portant lines of trade in the fifth reserve district,
reported to the Federal R eserve Bank of Richmond on their M ay business. Increased sales during
the month in comparison w ith sales during M ay 1926 w ere shown in hardware, furniture and drugs,
but sales of groceries, dry goods, and shoes w ere in smaller volume than sales during the correspond­
ing month last year. In comparison w ith sales made in A pril this year, M ay sales gained in groceries,
hardware and furniture, but declined in dry goods, shoes and drugs. T otal sales since January 1st
w ere larger in shoes and hardware than during the corresponding five months in 1926, but grocery,
dry goods, furniture and drug sales w ere smaller this year than last.
Stocks on hand at the end of M ay this year w ere larger than stocks on hand on M ay 31, 1926, in
groceries and shoes, but dry goods and hardware stocks w ere smaller on the 1927 date. D uring
M ay stocks of dry goods on the shelves of the reporting firms increased over those on hand on April
30th this year, but stocks of groceries, shoes and hardw are declined during the month.
Collections during M ay w ere better than in A pril in furniture and drugs, but w ere slow er in
groceries, dry goods, shoes and hardware. The percentage of collections during M ay to total re­
ceivables as of M ay 1, 1927, averaged 66.8 per cent in groceries, 58.0 per cent in drugs, 35.6 per
cent in furniture, 35.0 per cent in hardware, 33.4 per cent in shoes, and 31.6 per cent in dry goods.
The shoe, hardware and drug percentages w ere slightly higher than those of M ay last year, but the
M ay 1927 percentages in grocery, dry goods and furniture lines w ere low er than those of M ay 1926.




(Compiled June 20, 1027.)

7

BUSINESS CONDITIONS IN THE UNITED STATES.
(Compiled b y the Federal Reserve Board)

Industrial production increased in May and continued at a
higher lever than a year ago, while distribution o f commodities was
in smaller volume than last year. The general level o f wholesale
commodity prices has changed but little in the past two months.

192A-

1923

1926

1925

PRODUCTION. Output o f manufactures increased consider­
ably in May, while production o f minerals was maintained at the
April level. Increased activity was shown in cotton and woolen
mills, in meat packing, and in the production of lumber. The out­
put o f iron and steel, nonferrous metals, automobiles and building
materials, after allowance fo r usual seasonal variations, was main­
tained at practically the same level as in April. Since the latter
part o f May, however, production o f steel and automobiles has
declined. The total value o f building contracts awarded continued
slightly larger in May and in the first two weeks o f June than in
the corresponding period of last year. Production o f winter wheat
was estimated by the Department o f Agriculture on the basis o f
June 1st condition at 537,000,000 bushels, or 90,000,000 bushels
less than last year. The indicated rye production was placed at
48,600,000 bushels, which is 20 per cent larger than the crop in
1926.

1927

l&dex numbers of production of manufactures and minerals, adjusted
for seasonal variations (1923-25 average - 100). Latest figures,
May, manufacturers 112, minerals 107.

PERCENT

PERCEI

2001---------------

WHOLESALE PRICES

Index of United States Bureau of Labor Statistics
adopted by Bureau). Latest figure, llay 144.1.

BILLIONS OF DOLLARS

2

“ --------------------- 1

1

1

.........

R E S E I R V E B A N K C R E D IT
1
.

Total

j

Fteserve Bank I
Credit 7 '

\ J/I

TRADE. Sales of retail stores in May showed more than the
usual seasonal decline from the high April level. Compared with
May of last year, department store sales were about 4 per cent
smaller, while those o f mail order houses were slightly larger. Value
o f wholesale trade of all leading lines, except groceries and meats,
was smaller in May than in April and in the corresponding month
of 1926. Inventories of merchandise carried by department stores
showed slightly more than the usual seasonal decline in May and at
(1913 s 100, base
the end o f the month were somewhat smaller than a year ago. Stocks
o f wholesale firms were also smaller than last year. Freight car load­
BILLIONS OF DOLLARS
2
ings increased in May by less than the usual seasonal amount and
fo r the first time in over a year daily average loadings were in
smaller volume than in the corresponding month o f the preceding
year. Loadings o f all classes o f commodities except livestock, ore
and miscellaneous products were smaller than last year.
PRICES. The general level o f wholesale commodity prices
has remained practically unchanged since the middle of April.
Prices o f grains, cotton, hides and skins have advanced but these
advances have been offset in the general index by declines in the
prices o f livestock, wool, silk, metals and rubber.

l

i

Z

*

Disco untsfor
Membisr Banks

U.S.Secijrifies

'
Y

N

A

AJ

1923

1924

X
Acceptanc» s
1925

_

1..... ..
.
1926

1927

Monthly averages of daily figures for 12 Federal Reserve Banks.
Latest figures are averages of first 23 days of June.

BILLIONS OF DOLLARS

BILLIONS OF DOLLARS

10

10

1924

1927

Monthly averages of weekly figures for banks in 101 leading cities.
Latest figures are averages for first three weekly reports of June.




BANK CREDIT. Demand fo r bank credit to finance trade
and industrials remained at a constant level between the middle o f
May and the middle o f June, and the growth in the volume o f credit
extended by member banks in leading cities during the period was in
holdings of securities and in loans on stocks and bonds. Loans to
brokers and dealers in securities by reporting member banks in New
York city increased rapidly and on June 15th were in larger volume
than at any previous time covered by the reports. At the Federal re­
serve banks there was little net change in the volume o f bills and se­
curities between May 25th and June 22nd, the fluctuations during
the period reflecting largely the effects o f Treasury operations. Dis­
counts fo r member banks toward the end of June were in about
the same volume as a month earlier, whil£ there was a decline in
the reserve banks’ holdings of acceptances and an increase in their
portfolio o f United States securities.
Conditions in the money
market were fairly stable throughout the period, with slight ad­
vances in the rates on commercial paper and more recently on
bankers acceptances.

8