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MONTHLY REVIEW CREDIT, B U S I N E S S AND A G R I C U L T U R A L CONDI TI ONS WILLIAM W. HOXTON, C h a ir m a n and F ederal R e s e r v e A gent FEDERAL RESERVE BANK OF RICHMOND JU N E 30, 1930 RICHMOND, VIRG IN IA M A Y business was irregular in the Fifth Federal reserve district; there was no marked change from other recent months in any special line. Between the middle of May and the middle of June there was some increase in rediscount holdings at the Federal Reserve Bank of Richmond, a later expansion of credit than usually develops in the spring. Member bank loans on securities showed an increase during the past month, but all other loans by reporting member banks declined by approximately the same amount. Debits to individual accounts figures, con sidered a fairly good indicator of business activity, were materially lower during the four weeks ended June 1 1 th than in the preceding four weeks this year and the corresponding four weeks in 1929, the decline being uniformly distributed over the entire district. In com paring this year’s figure with these of last year, how ever, some allowance should be made for lower prices. Business failures in the Fifth district in May were 6 per cent more numerous than failures in May last year, and liabilities involved in insolvencies last month showed an increase of approximately 50 per cent over the May 1929 liabilities. Employment conditions did not improve as much as seasonal activities might have implied, and it cannot be said that prospects for early improvement are at present any better than they were a month or six weeks ago. Coal production in the district was smaller in May than in either April this year or May last year. Conditions show no improve ment in the textile field in the Fifth district, except that the mills have put into effect a schedule of curtailment and are thus keeping down the accumulation of manu factured goods in their warehouses. Cotton prices de clined further between the middle of May and the mid dle of June, making the accumulation of finished pro ducts at textile mills more undesirable than usual. Cot ton consumption in the district last month totaled only 199,858 bales, compared with 283,623 bales used in May 1929. The district used a smaller percentage of the country's total consumption in May than in any other month for a considerable period. Conditions for this year's crops were on the whole quite unfavorable in May in the Fifth district, due to cool weather and frosts, and a marked deficiency in rainfall. All crops were retarded in growth, and some of them quite seri ously damaged by the cold and dryness. Construction work provided for in permits issued in cities and con tracts actually awarded for both urban and rural con struction was in considerably lower volume last month than in May 1929, and May last year was itself a rather poor month in this respect. Wholesale trade in five leading lines was in less volume last month than in the same month last year, and collections were also slower in nearly all lines. Last month was not without favorable signs. De posits have recently increased considerably in report ing member banks and at the middle of June totaled more than aggregate deposits a year earlier, which would seem to indicate that aggregate purchasing power of the banking public is increasing in spite of much unemployment and losses in last fall's decline in stock prices. Another favorable sign at present is the com fortable position in which both member banks and the reserve bank find themselves, with their funds in a rela tively liquid condition and with ample resources to care for legitimate needs as they arise. Business failures, whie more numerous than a year ago, were fewer in May than in April, and last month’s liabilities were only about half the exceptionally high figures of the preced ing month. Retail trade as reflected in department store sales in May was on the whole better in most of the district than in May last year, and the stores are oper ating with smaller stocks than last year, thus increasing their rate of stock turnover. Finally, copious rains in nearly all sections of the district at the end of May and in the first three weeks of June distinctly improved ag ricultural prospects since the official June 1 condition reports were issued. Reserve Bank Statement. The fluctuations in the principal items of condition in the statement of the Federal Reserve Bank of Rich mond were slight between the middle of May and the middle of June. Contrary to seasonal trend, rediscounts for member banks rose by $2,625,000, or approximately 16 per cent, during the month. Holdings of Govern ment securities also increased, by $3,404,000, or 27 per cent, but the Bank’s holdings of open market paper de MONTHLY REVIEW 2 dined by $2,657,000, or 29 per cent. These changes resulted in a net increase of $3,372,000, or 8.7 per cent, in total earning assets during the month under review. Federal reserve note circulation declined only about one-half of 1 per cent between May 15th and June 15th, 000 omitted 000 omitted ITEMS ITEMS May 15 1930 June 15 1929 Rediscounts held .......................... $ 19,476 $ 16,851 Open market paper ..................... 6,448 9,105 Government securities ................ 16,044 12,640 Total earning assets ............... 38,596 41,968 Circulation of Fed. Res. notes.... 67,288 67,643 Members’ reserve deposits ...v..... 64,138 63,229 Cash reserves ................................ 106,216 102,693 Reserve ratio ................................ 76.60 77.20 $ 54,753 3,890 4,809 63,452 66,679 70,693 82,721 59.83 June 15 1930 a smaller decrease than usually occurs at this season. Member banks increased their reserve deposits by 1.4 per cent last month, partly to meet the higher require ments resulting from some increase in deposits in mem ber banks. The several changes in the items mentioned, with others of less importance, raised the cash reserves of the Federal Reserve Bank of Richmond by $3,523.000, or 3.4 per cent, but the ratio of reserves to note and deposit liabilities combined dropped from 77.20 per cent on May 15th to 76.60 per cent on June 15th. A comparison of the figures reported for June 15, 1930, with those reported a year earlier, June 15, 1929, shows important changes in the Bank's earning assets and cash reserves. Rediscounts for member banks de clined by $35,277,000, or 64.4 per cent, during the year, but this was partly offset by increases of $2,558,000 in holdings of open market paper and $11,235,000 in in vestments in Government securities. The net decrease in total earning assets during the year was $21,484,000, or 51.2 per cent. The circulation of Federal reserve notes was practically the same at the middle of June in both 1930 and 1929, being less than 1 per cent higher this year. Member bank reserve deposits declined $6,555.000, or 9.3 per cent, during the year, but probably almost half of this decrease is due to withdrawals from the Reserve System during the; year by reason of con solidations. The material reduction in funds invested in earning assets this year, with small changes in de posit and note liabilities, naturally results in an increase in cash reserves, which were $23,495,000, or 28.4 per cent, higher on June 15, 1930, than on June 15, 1929. The ratio of cash reserves to note and deposit liabilities combined rose 16.77 points during the year, approxi mately the same percentage increase as that shown by cash reserves. Member Bank Statement. The accompanying table shows the principal items of condition reported by fifty-eight member banks in thir teen leading cities in the Fifth reserve district on three dates, June 11th and May 14th, 1930, and June 12, 1929, thus affording opportunity for comparison of the latest available figures with those for the preceding month this year and the corresponding date a year ago. The banks which reported for the 1930 dates are iden tical, but the lists used this year and in 1929 vary slight ly, although in total resources the reporting institutions were substantially the same in both years. June 11 1930 May 14 1930 June 12 1929 Loans on stocks and bonds (in cluding Governments) .......... $201,929 $197,028 All other loans ............................ 281,129 285,238 Total loans and discounts........ 483,058 482,266 Total inv. in bonds and stocks 160,595 162,156 Reserve bal. with F. R. Bank 41,028 40,010 Cash in vaults .............................. 13,942 11,398 Net demand deposits . ................ 347,890 346,538 Time deposits .............................. 253,285 247,302 Borrowed from Fed. Res. Bank.... 3,899 3,797 $186,836 321,312 508,148 158,249 39,554 11,075 348,635 239,215 24,858 During the past month, the fifty-eight reporting banks increased their loans on stocks and bonds by $4,901,000, but decreased all other loans by $4,109,000, a net in crease in total loans and discounts of only $792,000, although deposits increased about $7,000,000. Total investments in bonds and stocks rose $1,561,000 be tween May 14th and June 11th, and cash in vaults rose $2,544,000 during the same period. Aggregate reserve balances of the reporting banks at the Federal Reserve Bank of Richmond declined $1,018,000 between May 14th and June 11th, little more than a daily fluctuation. Total deposits rose $7,344,000 last month, net demand deposits increasing $1,361,000 and time deposits rising $5,983,000. Little change occurred in the borrowing by the reporting banks at the reserve bank, the total rising by $102,000. A comparison of the June 11, 1930, figures with those for June 12, 1929, shows some interesting changes, chief among them being the marked decline in bor rowing at the reserve bank, which dropped from $24,858,000 last year to only $3,899,000 on June 11th this year. At the same time the reporting banks decreased total loans to their customers by $25,090,000, a drop of $40,183,000 in all other loans much more than off setting a rise of $15,093,000 in loans on securities. It is undoubtedly true that loans on securities do not rep resent stock exchange or speculative loans to as great a degree as was once the case, since business firms and corporations as well as individuals borrow for ordinary commercial purposes on such collateral to a considable extent. The reporting banks increased their invest ments in bonds and stocks by $3,907,000 during the past year, and their cash in vaults rose $2,867,000. Demand deposits declined a fraction of 1 per cent during the year, due to a change in the list of reporting banks, but in spite of this change which took out slightly larger deposits than were substituted to replace them an in crease of $14,070,000 is shown in time deposits. Debits to Individual Accounts. Aggregate payments by check in the clearing house banks in twenty-four leading Fifth district cities are shown in the accompanying table for three equal pe riods of four weeks, ended June 11th and May 14th, MONTHLY REVIEW this year, and June 12th last year. These figures in clude all checks drawn against depositors’ accounts in the reporting banks, irrespective of whether or not the checks go through the clearing house, and are generally considered to be a good barometer of banking trans actions. 000 omitted Total debits, four weeks ended May 14 June 12 June 11 1929 1930 1930 Asheville, N. C............. Baltimore, Md................ Charleston, S. C........... Charleston, W. Va....... Charlotte, N. C............. Columbia, S. C.... .......... Cumberland, Md........... Danville, Va.................. Durham, N. C............... Greensboro, N. C......... Greenville, S. C............. Hagerstown, Md........... Huntington, W. Va..... Lynchburg, Va.............. Newport News, Va..... Norfolk, Va.................. Portsmouth, Va............. Raleigh, N. C................ Richmond, Va............... Roanoke, Va.................. Spartanburg, S. C....... Washington, D. C..... Wilmington, N. C........ Winston-Salem, N. C... $ 25,699 380,026 25,750 39,472 45,799 25,859 8,282 5,944 21,521 20,674 15,494 8,633 19,421 16,619 11,045 53,238 4,477 19,673 113,790 27,240 11,466 216,177 11,893 28,396 $ 21,633 411,481 28,090 42,387 47,229 31,149 8,457 6,584 22,587 19,925 16,428 9,448 19,312 16,270 10,309 54,696 4,648 26,134 120,416 27,931 11,684 217,780 14,845 32,233 $ 31,131 364,083 24,800 37,780 51,362 20,057 8,723 7,560 30,508 20,982 18,701 9,527 20,513 17,017 9,592 56,932 5,058 22,385 118,768 29,211 13,229 242,098 15,336 38,409 District T otals.......... $1,156,588 $1,221,656 $1,213,762 Aggregate debits in the four weeks ended June 1 1 th were $65,068,000, or 5.3 per cent, less than debits in the preceding four weeks, ended May 14th, and were $57,174,000, or 4.7 per cent, less than in the corre sponding four weeks last year, ended June 12, 1929. The decrease in the latest period in comparison with the preceding one this year was largely seasonal, due to after-Easter payments for merchandise and also to the occurrence of holidays in some parts of the district on May 30th and June 3rd. Only five cities, Asheville, Greensboro, Huntington, Lynchburg and Newport News, reported larger figures for the four weeks ended June 11th than for the four weeks ended May 14th. As previously intimated, the decrease in debits this year in comparison with the corresponding four weeks in 1929 is probably accounted for in large part by price changes, the general level of prices being lower at present than in June a year ago. Five cities reported higher totals for the latest 1930 period than for the same period last year, Baltimore, Charleston, S. C., Charleston, W. V., Columbia and Newport News. Newport News was the only city which showed gains for both the monthly and yearly comparison. The increases in Charleston, S. C., and Columbia were due to State government transactions, and probably the same statement applies to Charleston, W. Va. 3 Savings and Time Deposits. Total deposits in twelve mutual savings banks in Baltimore declined from $195,174,471 on April 30, 1930, to $195,057,396 on May 31st, but on the latter date stood approximately 3 per cent above $189,402,208 on deposit in the same institutions on May 31, 1929. The decline in mutual savings bank deposits in May appears to be seasonal, a drop during that month having occurred in nine of the past eleven years. On June 11th this year, fifty-eight regularly reporting member banks had time deposits aggregating $253,285,000, a sum 2.4 per cent above $247,302,000 reported on May 14, 1930, and 5.9 per cent above $239,215,000 on June 12, 1929. The time deposit figures for member banks do not all represent savings accounts, however, as do the mutual savings bank figures. Reserve requirements being lower on time deposits than on demand deposits, there has been a considerable shift of demand to time de posits in member banks in recent years. Business Failures. Bankruptcies in the Fifth reserve district in May 1930 numbered 124, an increase of 6 per cent over 117 failures in May 1929, but a smaller number than 130 insolvencies in April this year. In number of failures, the district record for May was better than the National record, which showed an increase of 15 per cent in comparison with the number of failures in May 1929. Liabilities involved in Fifth district failures last month totaled $3,067,805, an increase of approximately 50 per cent over $2,052,505 reported for May 1929 but a large decrease under $7,244,020 for April 1930. The National liabilities showed an increase this year of only 35 per cent in comparison with the Fifth district rise of 50 per cent. Eight of the twelve Federal reserve districts reported a larger number of insolvencies in May this year than in May 1929, and eight districts also reported higher liabilities this year, but only five dis tricts, of which the Fifth district was one, reported in creases last month in both number of failures and total of liabilities involved. Employment. Employment conditions in the Fifth reserve district have not improved as much this spring as many people expected they would. There is no very large number of people out of work at any particular place, but throughout the entire district there are workers in near ly every community who cannot find employment. The industries of the district, with the exception of tobacco factories, and some of the ship yards, are operating below capacity, and construction work on the whole is below what might be called normal for this season of the year. In some cities and at least one state in the district plans for additional building and road work are shaping up, distinctly improving prospects for addi tional employment in the next few months. 4 MONTHLY REVIEW Coal Production. The movement to curtail operating time, which began to be noticed in April, continued in the textile mills of the Fifth district through May and June, and cotton consumption by the mills of the district in May totaled only 199,858 bales, compared with 230,968 bales in April 1930 and 283,623 bales in May 1929. Mills in all three of the cotton manufacturing states in this dis trict are operating on restricted schedules, but the de cline in production appears to be greatest in South Carolina where most of the mills make cloth. The yarn mills, most numerous in North Carolina, and specialty mills making towels, hosiery, underwear, etc., are doing somewhat better than the regular cloth mills. North Carolina mills used 108,204 bales of cotton in May, a decrease of 11,271 bales under the April consumption figure, South Carolina mills used 80,934 bales in May, a drop of 19,652 bales under the April figure, and Vir ginia mills used 10,720 bales in May, 187 bales below the April figure. Practically all of the business the mills are doing is from hand to mouth, as is natural in the face of a steadily declining cotton market, and there is much complaint about narrow profit margins from mill executives. and a drop of $10 in the past six weeks. The farmers of the district sell very little cotton at this season, but the price fluctuations are important to textile mills and also afford a clue to what cotton merchants and specu lators think of new crop prospects, the probable future demand for cotton textiles both at home and abroad, and the world supply of available cotton. Consumption of cotton in the United States in May 1930 totaled 473,917 bales, compared with 532,382 bales used in the shorter month of April this year and 668,650 bales in May 1929. Total consumption for the ten months of the present season—August 1st to May 31st—amounted to 5,329,916 bales, compared with 5,974,486 bales consumed in the corresponding period of the 1928-1929 season. Manufacturing establishments held 1,531,346 bales on May 31st, compared with 1,667,394 bales held on April 30th and 1,475,837 bales on May 31, 1929. Public warehouses and compresses held 3,337,360 bales in storage at the end of May this year, compared with 3,636,296 bales so held a month earlier and 1,845,771 bales on May 31st last year. May exports totaled 208,796 bales, compared with 349,762 bales sent abroad in April 1930 and 313,003 bales ex ported in May 1929. Exports during the ten months of this cotton year totaled 6,329,322 bales, compared with 7,506,945 bales shipped over seas during the cor responding ten months ended May 31, 1929. Spindles active at some time during May numbered 23,374,434, compared with 28,860,382 in April this year and 30,937,182 in May 1929. Cotton consumption in the cotton growing states to taled 370,676 bales in May, compared with 413,039 bales used in April and 504,513 bales in May 1929. Last month's consumption in the cotton growing states amounted to 78.22 per cent of National consumption, a higher percentage than either 77.58 per cent in April this year or 75.45 per cent in May 1929. Of the 370,676 bales of cotton consumed in the cotton growing states in May, the Fifth district mills used 199,858 bales,, or 53.91 per cent, a lower percentage than this district usually attains. Although this year’s cotton crop was planted promptly and on the whole came up to good stands, the weather has been unfavorable for proper development and pros pects for this year’s probable yield have declined since the latter part of April. Cotton is a hot weather plant, but the spring was unusually .cool and growth was re tarded. In addition to this factor, insufficient rain has fallen in most of the district, and growers have been unable to cultivate the fields properly. However, there is no plant which can endure more unfavorable condi tions and then make a quicker recovery than cotton, and it is yet too early in the season to form any opin ion as to probable yield. Cotton Statistics. Agricultural Notes. The average price for spot cotton on ten Southern markets continued to decline steadily in May and the first half of June, and on June 13th, the latest date for which statistics are available, was 13.28 cents per pound, the lowest average since February 12, 1927. This price represents a decline of $20 per bale since last September MARYLAND crops were retarded in May by dry weather. Wheat developed earlier than usual, hay crops made little growth, and pastures were much below the average for this time of year. The strawberry crop was also hurt by lack of rain, and potatoes show a rather poor stand. Apples show a better set of fruit The total production of bituminous coal in the United States in May 1930 amounted to 35,954,000 net tons, compared with 35,860,000 tons during the shorter month of April and 40,706,000 tons mined in May last year. Daily average production in May this year of 1.376.000 tons compared with an average of 1,390,000 tons in April 1930 and 1,542,000 tons in May 1929. Total production of soft coal during the present calen dar year to June 7 (approximately 135 working days) amounted to 205,073,000 net tons, the lowest figure for the corresponding period of recent years. Tidewater shipment of coal in May through Fifth district ports totaled 2,033,265 tons, and total shipments since Janu ary 1, 1930, totaled 11,283,278 tons. The May 24th report of the Bureau of Mines, De partment of Commerce, gave coal production figures for the month of April. West Virginia continued in second place with 9,662,000 net tons., The states of West Virginia, Virginia and Maryland mined a total of 10,765.000 tons in April, slightly more than 30 per cent of the National production. In retail yards, summer prices were put into effect in May, and in Richmond are at substantially the same levels as in 1929. Yards are adequately stocked with all prepared sizes of coal to fill orders promptly, and some home owners are filling their bins for next winter. Textiles. MONTHLY REVIEW than orchardists had expected, while peaches indicate about 50 per cent of a full yield. VIRGINIA suffered from cool weather during the entire spring and a severe drought from the middle of April until well into June further damaged nearly all farm crops. Spring planting was delayed and in many cases seed germinated poorly, coming up to irregular stands. Corn is up to a poor stand, and this, with con siderable damage from wire and cut worms, made a considerable amount of replanting necessary. Local rains around the middle of May enabled some of the tobacco growers to transplant to the fields at the proper time, but in other sections artificial watering was neces sary. Tobacco plants were plentiful, seed beds having done well. Cotton and peanuts were late in coming up, and stands were irregular. Many fields of peanuts were planted a second time. Farm gardens are later than usual. Wheat headed out rather close to the ground, but the heads were of fair length and the straw was unusually healthy, and a crop of exceptional qual ity is expected. Fall sown oats stood the dry weather very well, but spring oats, comprising about 75 per cent of the total oat crop, was severely damaged by the drought. Hay crops are very short, and pastures are far below normal growth. Fruit prospects in Virginia this season are for a yield of apples somewhat less than in 1929, and the peach and pear crops are unusually short. Spring frosts and freezes did more damage than was thought earlier in the season, and the young fruit suffered further from lack of moisture. WEST VIRGINIA reports serious damage to all fruit crops, hays, potatoes, wheat and beans from a frost on May 26th, and crops were further damaged by lack of sufficient rain during April and May. On June 1 st corn had made little growth, pastures were very brown and short, and prospects were for not more than half a normal hay crop. Oats were very short on June 1st and the condition was the poorest for this season in 30 years. The condition figure for wheat declined 11 per cent during May, and apples showed a condition of only 40 per cent, while the peach crop at 15 per cent seems to be practically a failure. NORTH CAROLINA experienced the same dry weather already mentioned in other states, and crops were generally held back in growth. Much replanting was necessary. Good rains at the end of May and in early June distinctly improved the general outlook, how ever, and it appears likely that a considerable part of the damage done by the dry weather in April and May can be overcome if favorable seasons prevail during the next few weeks. Wheat plants were small, but the heads filled well and a fairly good yield is indicated on a smaller acreage than was planted last year. The early Irish potato crop was held back by the dry weather, but good rains at the end of May helped the crop materially. On June 1st pastures in North Caro lina were very poor and hay crops were also much below normal, but the rains in late May and early June brought immediate improvement and there are pros pects for a good hay yield. SOUTH CAROLINA had more rain in May than the balance of the Fifth district, and on June 1st the 5 crop situation was officially reported as satisfactory for the state as a whole. In Piedmont counties the spring weather was too dry for the best development of grain, but in the lower half of the state these crops were good'. The weather was favorable for harvesting and the grain crops were gathered in excellent condition. In Eastern Carolina some tobacco is buttoning out and prepara tions to begin curing at an early date are being made. Cotton in Eastern South Carolina is doing well, but considerable deterioration is reported in cotton in Pied mont counties since the middle of May, at which time prospects were quite promising. Building Permits. A table showing building permits issued in May in thirty-two cities of the Fifth reserve district appears elsewhere in this Review. Permits issued in May for new construction numbered 1,217, compared with 1,539 permits for similar work issued in May 1929, a decrease this year of 21 per cent. Valuation figures for new work totaled $7,338,786 last month and $8,943,991 in May last year, a decrease of 18 per cent. Alteration and repair permits also showed lower figures this year for both number and estimated valuation. Total valu ation in May for all classes of work amounted to $9,099,297, compared with $10,790,914 in May 1929, a decrease of $1,691,617, or 15.7 per cent, for the 1930 month. Twelve of the thirty-two cities reported higher valuation figures last month than in the same month of the preceding year, but twenty cities reported lower figures. Among the larger cities Baltimore, Charleston, W. Va., and Washington reported larger valuation fig ures this year, but in all three instances the gains were due chiefly to comparatively low figures in May 1929 rather than to an unusual amount of work this vear. Norfolk, Richmond, Charlotte and Winston-Salem re ported lower figures than a year earlier, Richmond showing especially small figures for the past month. Contract Awards. Contracts actually awarded for construction work in the Fifth district in May 1930 totaled $29,942,510, ac cording to figures collected by the F. W. Dodge Cor poration. This figure shows a decrease of approxi mately 19 per cent under $37,071,793 reported for May 1929. Most of the decline was in contracts for resi dential types of construction, which dropped from $1 1 ,294,633 in May 1929 to $6,579,780 in May 1930. It appears that a considerable number of cities are some what over-built in residences and apartment houses, and a larger proportion of current construction work than usual is going into industrial and business build ings. MONTHLY REVIEW 6 Retail Trade, 35 Department Stores* Baltimore Washington Other Cities District May 1930 sales, compared with sales in May 1929: 6.9 2.9 — 1.4 3.6 Jan.-May 1930 sales, compared with Jan.-May 1929: 4.5 — .2 — 7.0 .3 May 31, 1930, stock, compared with May 31, 1929: _ 4.6 _ 5.2 — 5.5 — 5.0 May 31. 1930, stocks, compared with April 30, 1930: — 3.3 — 4.1 — 1.7 — 3.7 Number of times stock turned in May 1930: .319 .327 .245 .304 Number of times stock turned since January 1, 1930: 1.465 1.420 1.081 1.358 Percentage of May 1, 1930, receivables collected in May: 25.3 30.8 32.2 28.2 — Denotes decreased percentage. Department store sales in the Fifth reserve district in May 1930 averaged 3.6 per cent higher than sales in May 1929, according to confidential reports from thirty-five stores. Baltimore stores with a gain of 6.9 per cent made the best record. Cumulative sales in the thirty-five stores since January 1st now show an in crease of three-tenths of 1 per cent over sales in the first five months of 1929, this increase being due en tirely to an increase of 4.5 per cent in Baltimore. In Washington total sales since the first of the year lack two-tenths of 1 per cent of equalling sales in the cor responding period last year, and the stores in the Other Cities group are 7.0 per cent behind their 1929 sales to the end of May. Most of these decreases were due to the unfavorable comparison of March 1930 sales with those of March 1929, the other four months this year comparing quite favorably in a majority of the report ing stores with last year’s business. There was a seasonal decline in stocks carried by the reporting stores during May, and at the end of the month stocks on hand averaged 5.0 per cent less than stocks on hand on May 31, 1929. Smaller stocks and larger sales last month resulted in a better turnover rate than in May last year, stocks being turned .304 times in comparison with .284 times a year ago. Since Janu ary 1, 1930, the reporting stores have turned their stock 1.358 times, compared with 1.329 times in the first five months of 1929. Collections in the reporting stores averaged 28.2 per cent of receivables outstanding on May 1st, a slightly lower rate than 28.7 per cent of outstanding receivables collected in May 1929. Washington and the Other Cities collections were slightly better last month than a year ago, but Baltimore stores reported an average decrease. Wholesale Trade, 67 Firms. 26 Groceries 9 Dry Goods 5 Shoes 15 Hardware 12 Drugs May 1930 sales, compared with May 1929 sales: — 7.2 — .5 — 2.6 4.6 - 5.5 May 1930 sales, compared with April 1930 sales: — 2.6 - 2.5 - 2.4 —11.0 1.9 Jan.-May 1930 sales, compared with Jan.-May 1929 sales —10.8 — 3.1 - 8.5 1.2 - 1.5 May 31, 1930, stocks, compared with May 31, 1929, stocks: — 3.7 (9*) —18.0 (4*) 12.4(5*) —12.9(8*) May 31, 1930, stocks, compared with April 30, 1930, stocks: — 5.2(9*) — 4.6(4*) 3.8(5*) — 7.0(8*) Percentage of May 1, 1930, receivables collected in May: 63.1(16*) 35.5(7*) 41.5(5*) 33.8(12*) 60.0(9*) — Denotes decreased percentage. * Number of reporting firms. Sixty-seven wholesale firms, representing five im portant lines of trade in the Fifth reserve district, re ported to the Federal Reserve Bank of Richmond on their May business. Sales last month were lower in every line than sales in May 1929, drugs showing the smallest decline and hardware the largest. In com parison with sales during April this year, May sales gained in groceries, but declined in dry goods, shoes, hardware and drugs. In total sales since January 1st, all lines for which figures are available except shoes show smaller sales than in the first five months of 1929. Stocks of shoes on the shelves of the reporting firms at the end of May were larger than stocks on May 31st last year, but grocery, dry goods and hardware stocks were smaller. Shoe stocks increased in May over the April 30th figures, but the other three lines declined. Collections in May were better than in April in all lines, chiefly a seasonal development, but were some what slower in all lines except shoes than in May last I year. (Compiled June 20, 1930) MONTHLY REVIEW 7 BUILDING OPERATIONS FOR THE MONTHS OF M A Y 1930 AND 1929. Permits Issued o fc CITIES New Repairs 1930 1929 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 30 31 32 1930 1929 1930 1929 Baltimore, Md......— Cumberland, Md-----Frederick, Md........... Hagerstown, Md....... Salisbury, Md......— Danville, Va............... Lynchburg, Va.......... Norfolk, Va.......... — Petersburg, Va.....— Portsmouth, Va......... Richmond, Va...... — Roanoke, Va.............. Bluefield, W. Va........ Charleston, W. Va...... Clarksburg, W. Va...... Huntington, W.Va...... Asheville, N.C...... — Charlotte, N. C.... — Durham, N. C............ Greensboro, N. C...... High Point, N. C.... Raleigh, N. C....... — Rocky Mount, N.C...... Salisbury, N. C.......... Wilmington, N.C-----Winston-Salem, N. C._..... Charleston, S. C......... Columbia, S. C........... Greenville, S. C......... Rock Hill, S. C. Spartanburg, S. C. Washington, D. C----- 532 18 7 16 16 10 7 67 8 14 74 32 9 52 22 13 8 45 13 9 13 11 22 5 8 28 13 17 6 4 11 107 496 1,444 1,549 $ 2,928,080 $ 1,894,320 32 10 36,580 46,680 13 10 7 5 13,668 37,380 23 5 9 26,515 26,590 12 23 12 18,630 102,750 13 9 17,600 7 69,305 20 22 17 65,225 162,390 34 90 80 146,696 175,460 4 5 4 42,100 11,218 22 31 21 12,515 15,200 106 64 72 193,148 1,544,348 52 27 40 176,684 90,519 4 7 5 6,150 6,190 43 16 28 133,245 89,631 22 18 21 34,480 91,010 5 12 31 771,586 45,405 9 35 46 24,430 118,851 58 71 38 355,861 399,310 21 18 8 42,050 106,375 35 42 34 19,816 105,340 25 3 6 45,115 129,600 28 5 13 15,145 119,152 14 8 3 31,838 101,880 5 1 3 15,600 16,700 14 12 45,6b0 7 22,800 31 64 74 103,535 171,180 22 52 24,072 26 65,350 25 62 35 70,200 65,925 14 20 23 76,200 38,450 13 14 9 11,750 684,345 17 23 23 59,200 45,309 204 426 726 2,519,825 1,600,675 Totals................... 1,217 1,539 2,496 3,032 $ 7,338,786 $ 8,943,991 1929 Increase or Decrease of Total Valuation 743,040 9,053 10,250 2,745 3,700 5,050 22,161 44,985 1,100 10,346 100,825 12,963 670 29,010 7,655 2,000 17,550 89,333 8,740 178,054 7,200 8,700 690 7,000 7,650 43,935 9,843 23,170 6,500 4,040 8,395 420,570 $ 943,840 — 463 — 31,395 4,578 — 78,570 — 53,475 — 113,846 — 63,570 37,522 5,399 —1,307,875 121,641 4,145 32,054 — 57,635 — 727,181 — 97,446 — 86,827 — 64,223 — 220,504 — 83,345 — 99,407 — 57,282 — 5,600 — 26,250 — 90,773 45,253 7,880 21,275 — 671,070 10,366 1,011,167 $1,846,923 $—1,691,617 Alterations New Construction 1930 $ 653,120 $ 18,690 2,567 7,398 9,250 3,280 5,480 10,179 7,740 18,430 144,150 48,439 4,855 17,450 6,550 1,000 14,525 45,955 8,842 43,074 8,340 13,300 13,450 300 4,200 20,807 13,818 26,775 65,525 5,565 4,870 512,587 $1,760,511 o fc T 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 30 31 32 — Denotes decrease. NOTE;—The figures in the above table reflect the amount of work provided for in the corporation limits of the sev eral cities, but take no account of suburban developments. Business Conditions in the United States will be found on next page. MONTHLY REVIEW 8 BUSINESS CONDITIONS IN THE UNITED STATES (Compiled by the Federal Reserve Board) The volume of industrial production declined in May by about the same amount as it increased in April. Factory employment decreased more than is usual at this season and the downward movement of prices con tinued. Money rates eased further, to the lowest level in more than five years. Industrial Production and Employment. The Board’s index of industrial production, adjusted for usual seasonal variations, declined about 2 per cent in, May. In 1930 industrial production has fluctuated between 4 and 7 per cent above the 1923-1925 average, and the preliminary estimate for May is 4 per cent above the average for those years. Production at steel and automobile plants declined, cotton mills curtailed output, and activity at woolen and silk mills continued at low levels. Cement production increased sharply, while output of petroleum and of copper showed little change. In the first half of June, output at steel plants declined further. The decrease in factory employment in May was larger than usual and there was also a decline in fac tory payrolls. The number employed in the cotton and silk goods industries decreased further, while in the woolen goods industry there was an increase from the extreme low point of April. Employment in the agri cultural implement and electrical machinery industries decreased from April but remained large relative to earlier years. Employment in the cement industry in creased, but in the lumber industry continued at an unusually low level. Building contract awards in May, as reported by the F. W. Dodge Corporation, continued to be in substan tially smaller volume than in any other year since 1924. Distribution. Freight carloadings increased by less than the usual seasonal amount during May and continued to be in somewhat smaller volume than in the corresponding period of 1928 and substantially below the unusually active period of 1929. Department store sales in May were approximately the same as those of a year ago. Wholesale Prices. A further decline in the wholesale prices of com modities occurred in May and the first half of June. The downward movement was interrupted in the last half of May by substantial increases in the prices of grains, meats, and livestock, but became pronounced about the middle of June when the prices of cotton, silk, rubber, copper, and silver reached exceptionally low levels. Wheat, meats, livestock and cotton tex tiles also declined in price at that time, while prices of wool and woolen goods, pig iron, and steel showed little change. Bank Credit. Loans and investments of reporting member banks increased further by $265,000,000 in the four weeks ending June 11, to a level considerably higher than a year ago. The increase was entirely in investments and in loans on securities, of which a large part rep resented loans made by New York City banks to brokers and dealers in securities in replacement of loans withdrawn by other lenders. -“ All other” loans contin ued to decline and at $8,400,000,000 on June 11, were the smallest since 1926. Expansion of member bank credit during this period was reflected in larger demand deposits and an increase of $30,000,000 in member bank reserves at the reserve banks. The volume of money in circulation showed a net increase of $13,000,000. Funds for these uses were obtained largely from further additions of $24,000,000 to the stock of monetary gold and from an increase of $22,000,000 in the volume of reserve bank credit outstanding. Reserve bank holdings of U. S. securities increased by about $50,000,000, and their holdings of acceptances declined by about half this amount. For the week ending June 18, the total volume of reserve bank credit declined somewhat and there was a decline in the volume of money in circulation. Money rates in the open market continued to decline during the latter half of May and the first half of June, and at the middle of the month commercial paper at 3^-324 per cent and acceptances at per cent were at the lowest levels since 1924 and early 1925. Bond yields moved slightly lower in June. In the first week of June the rediscount rate at Cleveland was reduced from 4 to 3^4 per cent; in the third week the rate at New York was reduced from 3 to 2y 2 per cent and the rate at Chicago from 4 to 3% per cent.
@FedFRASER