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MONTHLY REVIEW
CREDIT, BUSINESS AND AGRICULTURAL CONDITIONS

WILLIAM W.

H O X T O N , CHAIRMAN AND FEDERAL RESERVE AGENT

FEDERAL RESERVE BANK OF RICHMOND

RICHMOND, VIRGINIA________________________________________ JUNE 30, 1935
May exceeded production in April this
USINESS in the Fifth Federal
year, but was less than that of May
reserve district in May and the
last year. Textile mills in the Fifth
first half of June showed some con­
district increased the rate of opera­
flicting trends, but averaged about up
tions slightly in May in comparison
to seasonal levels. In banking, redis­
counts at the Federal Reserve Bank of
with April, but continued below the
level of last year. South Carolina led
Richmond rose moderately, and there
all states in hours of operation per
was also an increase in loans to in­
dustry for working capital, while mem­
spindle in place during April, the latest
ber bank reserve deposits declined, due
month for which figures are available.
Spot cotton prices declined materially
chiefly to purchase of Government se­
during the latter half of May, but re­
curities by member banks. A seasonal
gained part of the loss in early June.
decline in Federal reserve notes in cir­
culation occurred between the middle
Tobacco maufacturing as indicated by
of May and the middle of June. Reg­
revenue stamp taxes continued at a
very high level in May, and materially
ularly reporting member banks showed
exceeded the output of May 1934.
practically no change in loans during
the past month, but they added to their holdings of i Building permits issued in May 1935 were more than
securities and increased cash in vault. The reporting i double in estimated value those issued in May last
banks also reduced their reserve deposits, while their year, the increase being chiefly in residential construc­
demand deposits rose moderately. Time deposits de­ tion of the better class. Retail trade in May in de­
clined slightly, as frequently happens at vacation time. partment stores was rather disappointing except in
None of the regularly reporting member banks were Washington, at least partly due to unseasonally cool
rediscounting paper at the reserve bank during the weather and frequent rains. Wholesale trade in gro­
month under review. Debits to individual accounts ceries, hardware and drugs last month exceeded the
figures in twenty-three trade centers of the Fifth dis­ volume of trade in either April 1935 or May 1934,
trict in five weeks ended June 12 were 1.1 per cent but dry goods and shoe sales were less than in either
less than debits in the preceding five weeks, ended May of the earlier periods. Spring weather, which was
8, but exceeded debits in five weeks ended June 13, cool and wet, was unfavorable for planting and crop
1934, by 11.5 per cent. The decrease in the most recent development, but fall planted grains made good yields,
period in comparison with the preceding period this and hays and pastures are better than average through­
year was due to some quarterly payments in the earlier out the entire Fifth district. Although most spring
five weeks. The commercial failure record for May planted crops are getting a late start, present conditions
in the Fifth district was the best record made by any point to probabilities of good per acre yields if weather
of the twelve reserve districts, bankruptcies in the dis­ during the growing season is moderately favorable.
trict last month numbering only 27 in comparison with
64 in May 1934, and last month’s aggregate liabilities Reserve Bank Statement
of $507,813 comparing with $1,706,753 in May last
year. Employment showed some increase in the con­
Rediscounts at the Federal Reserve Bank of Richstruction field last month, but on the other hand there mod rose by $475,000 between May 15 and June 15,
was apparently no decrease in persons on relief rolls. this year, while the portfolio of open market paper
It appears that there was in reality little or no net remained unchanged. Loans to industry for working
change in employment conditions. Coal production in capital made under authority of Section 13 (b) of the

B




MONTHLY REVIEW

2

000 omitted

ITEMS

June 15
1935

May 15
1935

June 15
1934

Rediscounts held __________.. $ 650 $ 175 $ 888
193
174
174
Open market paper__ _________
4,392
4,035
0
Industrial advances_________
Government Securities---------- 116,716 113,563 103,563
Total earning assets----------- 121,932 117,947 104,644
Circulation of Fed. Res. notes.. 149,470 149,650 142,769
Members’ reserve deposits........ 141,584 147,003 123,088
Cash reserves ........................... 181,845 191,028 189,025
63.06
65.51
Reserve ratio ...........................
60.95

Federal Reserve Act increased by $357,000, and own­
ership of Government securities rose by $3,153,000.
These changes during the month resulted in a net in­
crease of $3,985,000 in the Bank’s total earning assets.
Federal reserve notes showed little change between the
middle of May and the middle of June, decreasing
$180,000, but member bank reserve deposits registered
a drop of $5,419,000. As a result of the several changes
mentioned, with others of less importance, cash re­
serves of the Richmond reserve bank declined $9,183,000 during the past month, and the ratio of cash
reserves to note and deposit liabilities combined de­
creased by 2.11 points.
In comparison with condition figures of the Federal
Reserve Bank of Richmond as of June 15, 1934, cor­
responding figures for June 15, 1935, show decreases
of $238,C O and $19,000, respectively, in rediscounts
O
for member banks and in the portfolio of open market
paper. On the other hand, working capital loans to
industry, of which there were none last year, totaled
$4,392,000 on the 1935 date, and holdings of Govern­
ment securities increased by $13,153,000 during the
year. The net change in total earning assets was an
increase of $17,288,000 between June 15 last year and
this. Circulation of Federal reserve notes at the mid­
dle of June this year was higher by $6,701,000 than a
year earlier, and member bank reserve deposits rose
by $18,496,000. These changes in the statement re­
sulted in a decrease of $7,180,000 in cash reserves at
the Federal Reserve Bank of Richmond in the year,
and lowered the ratio of cash reserves to note and
deposit liabilities combined by 4.56 points.

Statement of 28 Member Banks
ITEMS

June 12
1935

)00 omitted
May 8 June 13

1935

1934

Loans on stocks and bonds (in­
cluding Governments) ------- $ 50,147 $ 50,209 $ 60,285
92,786
192,950 108,837
All other loans.........................
Total loans and discounts...... 142,933 143,159 169,122
Investments in securities.......... 203,366 198,225 169,097
Reserve bal. with F. R. Bank....
57,766
69,767
47,466
12,954
11,324
11,770
Cash in vaults...........................
Demand deposits ...................... 247,110 243,524 213,916
Time deposits ........................... 137,318 138,022 134,537
Borrowed from F. R. Bank....
0
? 0
0

Twenty-eight member banks in leading cities of the
Fifth Federal reserve district send weekly condition




reports to the Federal Reserve Bank of Richmond and
the accompanying table shows totals of the principal
items as of three dates. June 12, 1935, figures are
compared with those for (May 8, 1935, and June 13,
1934, thus affording opportunity for comparison of
the latest available figures with those of the preceding
month and the preceding year.
Between May 8 and June 12, both this year, the
reporting banks reduced aggregate loans by $226,000,
of which $62,000 was in loans on securities and $164,000 was in all other loans. Investments in securities,
chiefly Government issues, increased $5,141,000 during
the month. The reporting banks reduced their reserve
balance at the Federal reserve bank by $12,001,000
between May 8 and June 12, while they increased cash
in vaults by $1,184,000. Total deposits in the twentyeight banks rose during the past month, a rise of $3,5&),000 in demand deposits more than offsetting a
decline of $704,000 in time deposits. A decrease in
time deposits usually occurs at the vacation season.
Between June 13, 1934, and June 12, 1935, loans
on stocks and bonds decreased $10,138,000 and all
other loans dropped $16,051,000, a total decline of
$26,189,000. All other items in the statement increased
during the year. Investments in securities rose by
$34,269,000, and reserve balance at the Federal reserve
bank increased by $10,300,000. Cash in vaults totaled
$1,630,000 more on the 1935 date than a year earlier.
Deposits rose $35,975,000 during the year, demand de­
posits with an increase of $33,194,000 accounting for
over 90 per cent of the gain. None of the twentyeight reporting banks were borrowing at the Federal
Reserve Bank of Richmond on the three dates used
in the table.

Time and Savings Deposits
Time deposits in twenty-eight regularly reporting
member banks and aggregate deposits in eleven mu­
tual savings banks in Baltimore totaled $338,335,063
at the end of May 1935, a lower figure than $338,825,410 at the end of April 1935, but a higher figure
than $326,631,808 at the end of May 1934. Reporting
member banks showed a decline in time deposits during
the past month but gained during the past year, while
the mutual savings banks gained deposits during both
the past month and the past year.

| Debits to Individual Accounts
Debits to individual, firm and corporation accounts
\ in the banks in twenty-three trade centers in the Fifth
! Federal reserve district are shown in the accompany! ing table for three equal periods of five weeks, ended
i June 12 and May 8 this year and June 13 last year.
; These figures reflect the volume of business which
| passed through the banks in the several cities during
i the periods under review.
In the five weeks ended June 12, 1935, aggregate
i debits in the reporting cities amounted to $1,110,130,000, a decrease of $12,904,000, or 1.1 per cent, in
! comparison with debits totaling $1,123,034,000 during
! the preceding like period, ended May 8. However, a

MONTHLY REVIEW
000 omitted
Total debits, five weeks ended
May 8,
June 12,
June 13,
1935
1935
1934

CITIES
Asheville, iN. C-----Baltimore, Md. -----Charleston, S. C-----Charleston, W. Va—
Charlotte, N. C.-----Columbia, S. C ------Cumberland, Md.........
Danville, V a..............
Durham, N. 1 -------C
Greensboro, N. C.---Greenville, S. C.-----Hagerstown, ;M d.---Huntington, W. Va...
Lynchburg, Va...........
Newport JNews, Va.....
Norfolk, Va...............
Portsmouth, Va.........
Raleigh, N. C.-------Richmond, Va. •,-----Roanoke, Va..............
Washington, D. C---Wilmington, N. C..—
Winston-Salem, N. G
District Totals ......

$

10,617
021,042
16,412
156,582
51,286
29,175
8,120

6,599
26,173
15,685
15,548
(8,163
>14,372
14,614
8,477
50,925
4,282
24,590
131,562
23,359
230,479
10,421
31,647
$1,110,130

$

10,884
323,527
15,631
51,543
54,991
26,504
7,945
6,545
23,623
14,797
14,893
8,104
14,290
15,297
8,087
53,004
4,454
25,740
136,023
21,595
241,525
9,966
34,066
$1,123,034

3

volved in the insolvencies that occurred in the month
just closed reached a total of $15,669,627. In April
this year the amount was $18,063,923, and for May
1934 it was $22,560,835. The high point for May
was in 1932, when the total involved for that month
was $83,763,521.” In the Fifth Federal reserve dis­
trict, failures in May 1935 totaled only 27, compared
with 45 in April this year and 64 in May last year.
Liabilities involved in May 1935 insolvencies in the
district totaled $507,813, a higher figure than $295,432
reported for April this year, but far less than $1,706,753 for May 1934. Only four of the twelve Fed­
eral reserve districts reported fewer failures in May
1935 than in May 1934, Richmond, Chicago, Minne­
apolis and San Francisco, and of these the Richmond
district recorded the greatest improvement this year.
In total liabilities involved, seven of the twelve dis­
tricts reported lower figures for the 1935 month, the
Richmond district again leading with the largest per­
centage decline from the figures of May 1934.

$

9,381
299,020
12,397
52,660
49,792
19,567
7,045
5,440
22,355
12,055
14,606
6,841
13,126
15,041
7,540
46,351
3,607
19,132
123,755
21,420
196,330
)8,559
29,334
$ 995,354

Employment
Data on employment conditions are conflicting this
month, some indicators pointing to increased opportun­
ities for work while relief agencies report increased
calls for help. Probably the most favorable sign of
the past month was a material increase in construction
in most of the cities of the district, especially in resi­
dential building of the better class. It is too early to
say whether the cancellation of NRA codes will result
in adding appreciably to unemployment, but apparently
there is a strong sentiment in the Fifth district toward
maintenance of code rules insofar as number of work­
ers and hours are concerned. Postponement of a
threatened strike in bituminous coal fields assures
steady employment for miners for at least a few ad­
ditional weeks. Tobacco factories continue full time
operations, and textile mills are running slightly in­
creased hours in comparison with April and early May.
In view of contemplated projects under the Federal
relief program, the outlook for labor is probably better
than it has been for a year or more.

majority of the cities reported higher figures for the
more recent period, thirteen cities increasing and ten
decreasing. Is the ten cities which failed to gain this
year, the five largest cities are included. At least part
of the decline in debits during the five weeks ended
June 12 was due to inclusion of some quarterly pay­
ments in the earlier period, ended May 8, especially
in the larger cities in which dividend payments are an
important factor in debits figures.
In comparison with debits reported for the five
weeks ended June 13, 1934, those for the correspond­
ing five weeks this year showed an increase of $114,776,000, or 11.5 per cent, part of which is probably
accounted for by higher price levels this year in some
lines. All of the reporting cities showed higher figures
for the 1935 period except Lynchburg, in which a de­
crease of 2.8 per cent was registered.

Commercial Failures

!

The Dun & Bradstreet Monthly Review for June, in
commenting on the business failure record for May,
says, “For more than a year commercial failures in
the United States have been reduced in number, dropping sharply below the peak levels of 1932 and for
many months falling under all comparative figures
since 1920. Liabilities involved in these defaults also
have been relatively small in amount. Some variation
has occurred in the monthly reports of failures, but
the change has not been great. For May this year
1,027 commercial failures were reported. These fig­
ures compared with 1,115 similar defaults in April
and 977 in May 1934. For May in the earlier years
of this decade and back to 1920, the number was
higher, reaching the high point in 1932, when there
were 2,788 failures reported for May. Liabilities in­

Production of bituminous coal in the United States
during the month of May 1935 amounted to 26,790,000
! net tons, an increase over 21,920,000 tons mined in
j April this year but less than 27,385,000 tons dug in
! May last year. Total production of soft coal during
i the present calendar year to June 8 amounted to 164,j 629,000 net tons, compared with 162,668,000 tons
mined in the same period last year, an increase this
year of 1.2 per cent. Coal shipped through Hampton
Roads ports during the present calendar year to June
1 totaled 8,115,899 tons compared with 8,350,686 tons
shipped through the same ports prior to June last year.
Retail coal prices in the Fifth reserve district are in
most instances lower than at this time last year, the
reduction being about twenty-five cents per ton.




Coal Production

4

MONTHLY REVIEW

Textiles
Fifth district textile mills operated at a slightly
higher rate in May than in April this year, but at a
lower rate than in May 1934. Cotton consumption
in the district last month totaling 211,412 bales was
2.9 per cent above consumption of 205,516 bales in
April, but 9.4 per cent below consumption of 233,324
bales in May last year. North Carolina mills used
108,722 bales of cotton in May, South Carolina mills
used 90,418 bales, and Virginia mills 12,272 bales, all
lower figures than those for May 1934. Consumption
of cotton in the Fifth district in May amounted to
45.1 per cent of National consumption, compared with
44.9 per cent of National consumution for the district
in May last year. Textile mills are trying to retain
code provisions by private agreement insofar as is pos­
sible.
The Bureau of the Census issued a report on May
21 on activity in the cotton spinning industry for
April. On April 30 there were 30,770,400 spindles in
place in the United States, of which 23,853,816, or
77.5 per cent, were active a total of 6,057,601,513
spindle hours during the month, an average of 197
hours per spindle in place. In the Fifth reserve dis­
trict there were 12,630,034 spindles in place on April
30, of which 11,168,754, or 88.4 per cent, operated a
total of 3,017,084,458 spindle hours in April, an aver­
age of 239 hours per spindle in place. South Carolina
with an average of 264 hours per spindle led all states,
Virginia with 250 hours ranked fourth, and North
Carolina with 214 hours ranked sixth, all being above
the United States average of 197 hours. With 41 per
cent of all spindles in place in the United States lo­
cated in the Fifth reserve district, the district mills
operated 49.8 per cent of total spindle hours in the
United States during April.

7,201,695 bales so held a month earlier and 6,560,165
bales on May 31 last year. May exports totaled 278,977 bales, compared with 284,764 bales sent abroad in
May 1934. Exports during the ten months of this cot! ton year totaled only 4,174,762 bales, compared with
| 6,769,369 bales shipped overseas during the correspond| ing ten months ended May 31, 1934, all foreign coun! tries having taken less American cotton this year.
I Spindles active at some time during May numbered
23,027,780, compared with 23,853,816 in April this
year and 25,895,778 in May 1934.
Cotton growing states consumed 378,909 bales in
May, compared with 374,013 bales used in April and
416,440 bales in May 1934. Last month’s consumption
of cotton in the cotton growing states amounted to
80.75 per cent of National consumption, a lower per­
centage than 80.81 per cent in April this year but
higher than 80.19 per cent in May 1934. Of the
378,909 bales of cotton consumed in the cotton grow­
ing states in May, Fifth district mills used 211,412
bales, or 55.79 per cent, compared with 56.03 per
cent of Southern consumption attained in the district
in May last year.
No official reports on the condition of the cotton
crop are issued until very late in the season, but un­
official information indicates that cotton in the Fifth
reserve district suffered from too much rain and cold
weather until about the first of June. Since that date,
however, the weather has been favorable, with many
clear days and high temperature, and cotton has pro­
gressed materially.

Tobacco Manufacturing

The Commissioner of Internal Revenue issued a
report on June 21 showing taxes collected on the man­
ufacture of tobacco in May. The figures show that
output of all types of manufactured tobacco except
snuff continued to run ahead of 1934 figures. May
Cotton Statistics
production of cigarettes in the United States numbered
Spot cotton prices fluctuated considerably during the 11,708,756,460, compared with 11,174,076,147 cigar­
past month, moving through a range of more than a ettes manufactured in May 1934. The number of cigars
cent a pound. On May 10 spot prices on ten South­ made last month also rose from 380,449,937 in May
ern markets averaged 12.44 cents per pound for mid­ 1934 to 407,731,360 in May 1935. Production of
dling grade. The week ended May 17 witnessed a smoking and chewing tobacco rose from 25,756,129
rise to 12.55 cents, but there was then a recession to pounds in May 1934 to 27,417,915 pounds in May this
12.38 cents on May 24. In the last week in May year, but snuff production declined from 3,299,653
the average price dropped to 11.47 cents, but in the pounds to 3,184,969 pounds. In actual amount of taxes
first week in June the price rose to 11.90 cents, and paid in May, cigarettes led with $35,134,986 this year
one June 14 reached an average of 12.03 cents. On and $33,553,593 last year; smoking and chewing to­
June 15, 1934, the average price was 11.97 cents.
bacco taxes totaled $4,935,691 in May 1935 and $4,Consumption of cotton in the United States in May 636,604 in May 1934; cigar taxes yielded $1,016,088
1935 totaled 469,250 bales, compared with 462,844 last month and $993,999 in May last year; and snuff
bales used in April this year and 519,299 bales in May taxes amounted to $573,295 and $593,938 in May 1935
1934. Total consumption for the ten months of the and 1934, respectively.
present cotton season—August 1 to May 31—amounted
to 4,566,121 bales, compared with 4,977,040 bales con­ Agricultural Notes
sumed in the corresponding period of the 1933-1934
Maryland weather in May was favorable for wheat,
season. Manufacturing establishments held 979,130
bales on May 31, compared with 1,060,946 bales held and prospective yield for 1935 rose nearly 600,000
on April 30 and 1,422,165 bales on May 31, 1934. bushels during the month. The June 1 forecast of
Public warehouses and compresses held 6,560,247 bales 7,505,000 bushels is over a million bushels below the
in storage at the end of May this year, compared with average production for the five years 1928-1932, and




MONTHLY REVIEW
about 400,000 bushels below the 1934 yield, but the
reduction in yield this year is entirely due to less acre­
age, the condition of the crop being above both last
year’s and the ten-year average. The final outturn of
wheat will depend upon weather in June, which ex­
perience has shown to be the critical period for attacks
of fungous diseases. The oat crop is also above aver­
age in condition, but the June 1 forecast of 232,000
bushels is less than the five-year average of 264,000
bushels, due to reduced acreage. A condition of 81
per cent for hay this year is about the same as 82 per
cent a year ago, weather conditions having been splen­
did for both hay and pastures. The apple crop is much
superior to the 1934 crop, a June 1 condition of 67
per cent comparing with last year’s condition of 36
per cent. The peach crop is also relatively good, the
reported condition on June 1 being 46 per cent com­
pared with the five-year average of 64 per cent and
last year’s condition of only 15 per cent. About 322,000
bushels are expected this year, against 82,000 bushels
last year and a five-year average yield of 509,000
bushels.
Virginia crop prospects on June 1 were generally
more favorable than usual, although cool weather in
May retarded the planting and growth of corn, cotton
and peanuts. Crop conditions were rather uniform
throughout the state as rainfall during the spring was
quite general. Prospects for fall grains are about aver­
age, while pastures, hay crops and fruits are better
than average. Truck crops made favorable progress
during May and the yield and quality of the straw­
berry and green pea crops have been especially good.
The production of early commercial potatoes will be
about 20 per cent less than last year, due to the smaller
acreage planted. The season has been favorable for
potatoes and the yield per acre will be above average.
The wheat yield will be reduced by rust which usually
causes considerable loss in a wet season. The esti­
mated production is 8,046,000 bushels which is practi­
cally the same as last year’s crop of 8,092,000 bushels
but is below the ten-year average production of 9,220.000 bushels. The condition of oats, rye and bar­
ley is better than last year and about the same as the
ten-year average. There is generally a heavy growth
of straw but heads are not well filled, the usual result
of a wet spring. Hay prospects are very good through­
out the state. The early hay crops made heavy yields,
but there was some loss in harvesting the crop due to
the frequent rains. The condition is reported at 84
per cent of normal, compared with 70 per cent on
June 1 last year and 75 per cent the ten-year average.
Pastures were unusually good in all sections of the
state and the condition on June 1 was 90 per cent of
normal compared with 72 per cent last year and 80
per cent the ten-year average. Production of early
commercial potatoes is estimated to be 7,692,000 bush­
els, compared with 10,012,000 bushels in 1934 and 5,831.000 bushels in 1933. The season has been favor­
able for potatoes and yields are expected to be above
the average. The smaller production this year is a
result of a considerable reduction in acreage following
the low prices received for the 1934 crop. Digging




5

has commenced but shipments will not be heavy until
near the end of June. The apple crop is not as heavy
as had been expected at blooming time, but prospects
are much better than last year, and probably the best
since 1931. Growers report 60 per cent of a full crop
on June 1, compared with 32 per cent last year and
54 per cent the ten-year average. Orchards are re­
ported to be in splendid condition, there is an abun­
dance of moisture and the fruit has been growing
rapidly, but there is considerable scab infestation as a
result of wet weather. Prospects are fairly uniform
throughout the state. The peach crop is considerably
larger than last year and the crop is especially good
in commercial orchards in Albemarle County. Grow­
ers report 45 per cent of a full crop, indicating a pro­
duction of 756,000 bushels compared with the 1934
crop of 414,000 bushels.
West Virginia field work was delayed over much of
the state during May as a result of backward spring
weather, and frosts were reported in the northern sec­
tions. The weather was characterized by intermittent
cold and warm days, and there was more than the
usual amount of rain. Winter wheat is now expected
to yield 2,226,000 bushels, compared with 1,974,000
bushels harvested last year, and this year’s rye crop
of 126,000 bushels compares with last year’s crop of
120,000 bushels. Oats planting has been delayed by
excessive rainfall, but the condition of the crop which
was up on June 1 was much better than a year ago.
Pasture conditions improved during May, and the con­
dition of 85 on June 1 compared with 79 on May 1
and 60 on June 1, 1934. Hay also improved in May,
and the condition of 82 per cent was far above 54 a
year ago. Fruit prospects on June 1 were about the
same as on May 1, although apples are not doing as
well as was expected. Considerable fruit is dropping
from the trees in farm orchards, but commercial or­
chards, in the main, are in better condition. The con­
dition of 66 per cent for the farm apple crop on June
1 was far above 29 a year ago.
The Carolinas experienced quite variable weather in
April and May, with more than average rain and cold,
but on the whole early crop conditions compare favor­
ably with those of average years. Wheat production
in North Carolina this year is forecast at 5,544,000
bushels, a higher figure than 4,340,000 bushels har­
vested in 1934 and a five-year average of 3,653,000
bushels. South Carolina with a forecast of 979,000
bushels this year exceeds 765,000 bushels last year
and 575,000 bushels the five-year average. The con­
dition of oats on June 1 was 84 per cent in both North
and South Carolina, a higher figure than the condi­
tions a year ago, and also above the five-year averages.
Hay condition on June 1 was better in both states than
the ten-year average, and pastures were also better
this year. Prospects for apples in North Carolina are
55 per cent of normal, compared with 45 per cent last
year, and South Carolina’s June 1 condition of 57 per
cent is a little better than the condition on June 1 last
year. The Carolinas have good prospects for peaches,
a crop of 2,450,000 bushels in North Carolina exceed­
ing the five-year average yield of 1,980,000 bushels

MONTHLY REVIEW
and South Carolina’s crop of 1,734,000 bushels also
bettering the five-year average production of 1,205,000
bushels. North Carolina early potatoes are better than
a year ago, but the South Carolina crop is lower than
the June 1934 condition.

Construction
Building Permits Issued in May
1935 and 1934
CITIES

Permits Issued
1935
1934

Total Valuation
1934
1935

75
71
51
39
24
47
701

837 $ 979,680 $1,003,800
5,642
625,083
9
31,505
13,045
11
2,220
40,307
8
10,825
16,175
15
13,453
24
71,623
25.125
21
34,747
91
66,133
94,450
7
18.125
1,965
27
17,711
23,920
106
149,237
174,942
31
10,556
37,009
8
4,850
12,625
56
8,317
71,767
52
19,856
44,593
22
10,395
24,000
62
62,761
87,750
42,383
27
79,923
22
45,945
201,963
45
27,281
120,346
23
15,075
45,269
6
8,345
30,770
6
3,760
39,005
4
6,975
4,332
57
24,022
67,387
22
1U50
67,170
22
35,970
123,049
36
26,500
25,230
11,540
16
65,508
34
15,815
16,639
516 2,611,585
871,595

District T otals___ 2,892

2,223 $5,851,857 $2,606,967

Baltimore, M d.-------Cumberland, Md.........
Frederick, Md. -----Hagerstown, Md........
Salisbury, Md............
Danville, Va.............Lynchburg, .V a.-----Norfolk, Va...............
Petersburg, Va...........
Portsmouth, Va. -----Richmond, ;V a.------Roanoke, iVa............ .
Bluefield, W. Va----Charleston, W. ,Va....
Clarksburg, W. Va.....
Huntington, W. Va.....
Asheville, N. C.-----Charlotte, N. C-----Durham, N. C.------Greensboro, IN. C.—
High Point, N. C.—
Raleigh, N. C............
Rocky Mount, N. C.—
Salisbury, 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.—

930
10

16
30
12

29
42
122

3
24
130
46

8
120

40
27
42
74
56
53
30
19
15

6

Building permits issued in 31 leading Fifth district
cities in May 1935 numbered 2,892, compared with
2,223 permits issued in May 1934, an increase of 30.1
per cent. Estimated valuation figures for all classes




of permits issued last month totaled $5,851,857, com­
pared with $2,606,967 valuation for permits issued in
May 1934, an increase this year of 124.5 per cent.
Twenty-six of the thirty-one cities showed higher val­
uation figures for May 1935 than for May 1934, and
most of the improvement appears to be in residential
construction.

Retail Trade, 31 Department Stores___________
Richmond Baltimore Washington Other Cities District

May 1935 sales, compared with sales in May 1934:
— 1.7
— 6.6
+ 8.7
— .7
+ .9
Jan.-May 1935 sales, compared with sales in Jan.-May 1934:
+ 3.0
+ .8
+ 12.6
+32
+ 6.1
May 31, 1935, stocks, compared with stocks on May 31, 1934:
+ 4.8
— 4.8
— .3
+ 1.1
— 1.4
May 31, 1935, stocks, compared with stocks on April 30, 1935:
+ 6.8 .
4 2
— 1.7
— 2.5
— .2
Number of times stock was turned in May 1935:
.336
.318
.398
.302
.35
Number of times stock was turned since January 1, 1935:
1.551
1.486
1.743
1.402
1.587
Percentage of May 1, 1935, receivables collected in May:
33.3_______301_______ 294_______309_______30.2
Note: Sales and stock changes are percentages.

W holesale Trade, 58 Firms
21
Groceries Dry Goods

6

Shoes

13
Hardware

11

Drugs

May 1935 sales, compared with sales in May 1934:
+ 3.0
—16.5
—26.8
+17.1
+ 1.9
May 1935 sales, compared with sales in April 1935:
+ 3.3
—11.4
—28.5
+ 71
+ 4.1
Jan.-May 1935 sales, compared with sales in Jan.-May 1934:
+ 6.8
—16.3
— 8.4
+10.5
+ .9
May 31, 1935, stocks, compared with May 31, 1934, stocks:
+ 5.2(8*) —27.9(3*) —16.8(4*) + 9.9(7*)
May 31, 1935, stocks, compared with April 30, 1935, stocks:
-7 .2 (8 * ) — 4.3(3*) — 8.3(4*) — 5.0(7*)
Percentage of May 1, 1935, receivables collected in May:
84.5(12*) 40.1(4*)
71.6(5*)
48.6(11*) 68.3(7*)
♦Number of reporting firms, All other figures in the table
are percentages.

(Compiled June 21, 1935)

MONTHLY REVIEW

7

BUSINESS CONDITIONS IN THE UNITED STATES

(Compiled by the Federal Reserve Board)

There was a further slight decline in industrial pro­
duction in May and factory employment and payrolls
also showed a decrease. Activity in residential con­
struction continued to be above the level of a year ago.

Production and Employment

Volume of industrial production, as measured by
the Board’s seasonally adjusted index, declined from
86 per cent of the 1923-25 average in April to 85 per
cent in May, which was the fourth consecutive month
of gradual decline from the recent high level of 90
in January. At steel mills output declined somewhat
in May and the first three weeks of June, as is usual
at this season. In the automobile industry, where out­
put this spring has been at a level substantially higher
than in other recent years, production showed a marked
decline in May, reflecting in part the effects of a strike.
At cotton mills there was little change in activity, while
at woolen mills production increased further, contrary
to seasonal tendency. Production of shoes declined
seasonally. Output of coal, which has fluctuated wide­
ly in recent months, reflecting partly developments in
the labor situation, showed a marked increase during
May and the early part of June.
Factory employment and payrolls declined between
the middle of April and the middle of May. Decreases
in employment were reported for the automobile, radio,
lumber, clothing, cotton, silk and shoe industries, while
at woolen mills employment increased and in many
other lines little change was reported.
Value of construction contracts awarded, as reported
by the F. W. Dodge Corporation, was about the same
in May as in April. Residential work continued in
excess of a year ago, while the volume of contracts
for public projects was smaller than in the correspond­
ing month of 1934.
Department of Agriculture estimates based on June
1 reports indicate that conditions for wheat, oats, bar­
ley, rye, hay, and pastures were at the ten-year average
for 1923-32, in contrast with conditions a year ago,
which were unusually poor as a consequence of a pro­
longed drought. The winter wheat crop this year is
estimated to be somewhat larger than last year and,
with a considerable increase indicated for spring wheat,
present conditions, according to the Department of
Agriculture, suggest a total crop of about 670,000,000
bushels as compared with 496,000,000 bushels last sea­
son and a ten-year average of 828,000,000 bushels. Do­
mestic stocks of wheat have been materially reduced
this season.




Distribution
Total volume of freight-car loadings increased in
May by about the usual seasonal amount. Coal ship­
ments showed a marked increase, while loadings of
miscellaneous freight declined. Department store sales,
as measured by the Board’s seasonally adjusted index,
increased from 73 per cent of the 1923-25 average in
April to 76 per cent in May and were at approximately
the same level as a year ago.

Commodity Prices
The general level of wholesale prices, which was
80.3 per cent of the 1926 average at the end of April
and also in the week ending May 25, had declined to
79.8 per cent by the week ending June 15, according
to the index of the Bureau of Labor Statistics. Grain
prices decreased considerably during May and the first
half of June. Cotton prices, after a sharp decline at
the end of May and a subsequent increase, also were
lower in the middle of June than at the beginning of
May. Prices of commodities other than farm products
and foods as a group advanced slightly during this
period.

Bank Credit
During the five weeks ending June 19 reserve bal­
ances of member banks increased by $175,000,000 as a
result of gold imports, offset in part by an increase in
Treasury cash and deposits with the Reserve banks.
Excess reserves of member banks on June 12 were
above $2,500,000,000 for the first time, but declined
somewhat in the following week.
At reporting member banks in leading cities there
was an increase of $540,000,000 in net demand depos­
its in the four weeks ending June 12, due in part to
gold imports. Time deposits declined by $150,000,000,
of which $70,000,000 represented a decline at New
York City banks consequent upon a ruling of the New
York Clearing House in May prohibiting the payment
of interest on new time deposits maturing in less than
six months. Total loans and investments of reporting
banks showed no important changes.
Short-term open-market interest rates continued at
low levels in May and the first Tialf of June.

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