View original document

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.

MONTHLY

REVIEW

o f Financial and Business Conditions
w

F if t h
Federal

.

“ B ltim re*
a o

/; Richmond $

Reser v e
District

“ VA;
N.C.

..• hr tte
Calo

&c.

Federal Reserve Bank, Richmond, Va.

June 30, 1940

Summary of May Business Conditions
a continuation o f business on a high level, nearly all
indicators showing advances over April and also over
May last year. The war in Europe has increased activity
in certain industries and localities, but the Fifth district’s
trade is largely domestic and the war has influenced
business less than in some other sections o f the country.

quite small, however, being only a two weeks’ supply.
Bituminous coal mined in the district last month was
above seasonal tonnage, and was
times May 1939
production, during which month Fifth district mines were
closed two weeks by a labor dispute. Tobacco manufac­
turing in May was higher than in April, but was slightly
lower than in M ay last year for all products except
cigarettes.

R E T A IL D ISTR IBU TIO N HOLDS UP

C O N STRU C TIO N A N D E M P L O Y M E N T RISE

Department store sales in May were 4 per cent above
sales in May 1939, and a representative group o f retail
furniture stores sold 9 per cent more last month than in
the same month last year. The numlber o f new automo­
biles registered in the district in May rose 19 per cent
above registrations in M ay last year. Checks drawn
against depositors’ accounts in 25 cities increased 16 per
cent in amount last month over the same period last year.
Cotton textile mills continued operations in May at
about the same level as in March and April, but sales
were slow during the month.
However, demand for
cotton cloth and yarn rose in the first half o f June, and
prices recovered most o f the decline which had occurred
in May. Rayon yarn shipped was 22 per cent above
shipments in May 1939, but production was still larger
and consequently reserve stocks o f yarn rose 4 per cent
during the month. Reserve stocks of rayon yarn are

Construction work provided for in M ay exceeded that
o f May 1939 by a substantial volume. Building permits
issued in 31 cities rose 10 per cent in valuation over per­
mits issued last May, and contract awards rose 24 per
cent this year. This rise in construction projects pro­
vides additional employment for both skilled and un­
skilled labor in the building trades, and in nearly all
lines employment is better than a year ago.
Agricultural prospects in the Fifth district improved
during May, especially in the latter half o f the month
when warm weather and rain stimulated plant growth.
Wheat prospects improved distinctly, fruit proved to have
suffered less from late freezes than had been thought
earlier, grasses in pastures and hay fields developed rap­
idly, and the weather was favorable for potatoes. H ow ­
ever, all crops are still late, and on June 1 corn planting
had not been completed in the upper half o f the district.

I N the Fifth Federal Reserve district, May witnessed

BUSINESS STATISTICS— FIFTH FEDERAL RESERVE DISTRICT

Debits to individual accounts (25 cities)....
Sales, 31 department stores, 5th district....
Sales, 36 furniture stores, 5th district.........
Sales, 192 wholesale firms, 5th district.......
Registrations, new autos, 5th district.........

$1,362,938,000
$ 10,474,004
1,137,135
$
$ 12,617,000
23,623

Number o f business failures, 5th district..
Liabilities in failures, 5th district................
Values of building permits, 31 cities.........
Value of contracts awarded, 5th district....
Cotton consumption, 5th district (Bales)..

$
$
$

Cotton price, cents per lb., end o f month....
Print cloths, 39 in., 80x80s, end o f month....
Rayon shipments, U. S. (P ou nds)...............
Rayon yarn stocks, . US. (Pounds)..........
Bituminous coal mined, U. S. (T o n s).........




51
604,000
12,665,284
39,339,000
313,962
10.11
6.38
32,100,000
12,200,000
35,468,000

Change
Month
Year

April 1940

May 1939

$1,338,001,000
9,218,187
$
1,164,592
$
$ 12,093,000
26,726

$1,172,618,000
$ 10,101,952
1,041,016
$
$ 11,427,000
19,822

+ 2
+ 14
— 2
+ 4
— 12

4- 16
+ 4
+ 9
+ 10
+ 19

48
779,000
11,524,997
31,619,000
292,286

+ 6
+ 74
+ 21
+ 24
+
1
— 5
— 7
+ 5
+ 4
+ 8

+
6
— 22
+ 10
+ 24
+ 7

May 1940

$
$
$

48
348,000
10,501,877
31,625,000
309,622
10.60
6.88
30,700,000
11,700,000
32,962,000

$
$
$

9.40
26,300,000
41,700,000
17,927,000

+

8

+ 22
— 71
+ 98

2

MONTHLY REVIEW
BANK ING STATISTICS
RESERVE BAN K STATEMENT ITEMS
Fifth District
000 omitted
ITEMS
June 15
May 15
1940
1940

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

June 15
1939

$

110
$
190
$
365
0
43
0
0
0
24
896
907
1,169
126,217______126,155______134,227
$127,223
$127,295
$135,785
224,457
217,259
193,540
298,881
302,841
249,513
432,154
440,400
3180,127
77.62
77.98
74.39

SELECTED ITEMS— 41 REPORTING MEMBER BAN KS
Fifth District
000 omitted
ITEMS
June 12
May 15
June 14
1940
1940
1939
Loans & discounts ....................................
$270,648
$269,348
$240,659
Investments in securities .......................
429,072
422,485
436,509
Reserve bal. with F. R. b a n k ...............
200,885
198,225
158,683
Cash in vaults ............................................
23,241
20,502
20,178
Demand deposits ........................................
569,955
556,380
485,870
Time deposits ............................................
201,662
202,146
202,106
Money borrowed ........................................
M U TU AL SAVINGS BANK DEPOSITS
10 Baltimore Banks
May 31
1940

May 31
1939

$223,616,485

Total deposits

Apr. 30
1940
$224,288,123

$220,130,334

DEBITS TO IN DIVIDUAL ACCOUNTS
Fifth District
May
1940
Dist. of Col.
Washington

000 omitted
April
May
1940
1939

$ 292,486

$ 289,325

$ 253,197

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

390,437
8,625
8,946

388,646
8,402
9,313

North Carolina
Asheville ...............
Charlotte .............
Durham .................
Greensboro ...........
Raleigh .................
Wilmington .........
Winston-Salem . .

12,711
63,876
29,277
20,847
39,966
11,231
40,563

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

% of Change
Month
Year

1

+ 16

323,042
7,842
8,073

+ 0
+ 3
— 4

+ 21
+ 10
+ 11

12,581
64,816
26,453
21,352
42,300
11,375
37,979

11,905
58,051
26,837
18,769
37,352
10,560
36,234

+ 1
— 1
+ 11
— 2
— 6
— 1
+ 7

+ 7
+ 10
+ 9
+ 11
+ 7
+ 6
+ 12

20,972
34,175
20,381
11,444

19,799
27,947
19,610
11,381

16,984
31,521
17,828
9,066

+ 6
+ 22
+ 4
+ 1

+ 23
+ 8
+ 14
+26

Virginia
Danville ...............
Lynchburg ...........
Newport News . .
Norfolk .................
Portsm outh...........
Richmond .............
Roanoke ...............

8,044
14,438
12,204
52,924
4,665
154.112
28,933

8,045
15,645
11,735
53,653
4,653
147,832
28,765

6,881
12,905
8,974
46,246
4,437
133,875
25,076

—
_
+
—
+
+
+

+
+
+
+
+
+
+

West Virginia
Charleston ...........
Huntington .........
Parkersburg .........

52,062
17,696
11,923

48.598
17,303
10,495

42,273
14,951
9,739

$1,362,938

$1,338,001

$1,172,618

District Totals

..

+

0
g
4
1
o
4
1

17
12
36
14
5
15
15

+ 7
+ 2
+ 14

+ 23
+ 18
+ 22

+

+ 16

2

+ 0 or — 0 indicates change of less than y 2 of 1 % .

IN SOLVEN CIES IN CREASE

Contrary to the National record, both the number o f
business failures and the aggregate o f liabilities involved
increased in the Fifth district in May over April, and the
number was also larger than in M ay last year, but lia-




bilities last month were less than in May 1939. Cumu­
lative figures for five months this year were lower in the
district for both the number o f failures and liabilities
involved than figures for the corresponding five months
last year.
Bankruptcy statistics gathered by Dun &
Brad street are as fo llo w s:
Number of Failures
District U. S.

PERIODS

Total Liabilities
District
U. S.

May 1940
................. ...........
April 1940 ................... ...........
May 1939 ...................

51
48

1,238
1,291
1,334

$ 604,000
348,000
779,000

$13,068,000
16,247,000
15,897,000

5 Months, 1940 ........... ...........
5 Months, 1939 ......... ...........

247
295

6,006
6,756

2,615,000
2,951,000

69,747,000
87,850,000

E M P L O Y M E N T INCREASES

Employment conditions in the Fifth Reserve district
were better in M ay than in May last year, and probably
showed improvement over April, although changes in the
past two months were relatively small. Coal production
figures indicate that employment was up about 2 per cent
in coal fields over April, and pay rolls for M ay 1940
were about double those for May 1939, when the mines
in the district were closed the first half o f the month
pending settlement o f a labor dispute. Textile opera­
tives were employed about the same in May as in April,
at a level approximately 7 per cent higher than a year
ago. Ship building in the N orfolk and Baltimore areas
continues at a very high level, skilled men are in demand
at Baltimore for work on aircraft, and construction work
provided for in M ay building permits and contract awards
calls for additional labor. A strike of a few machinists
tied up a large tobacco factory in the district about four
weeks in late May and early June and threw approximate­
ly 2,000 people out o f work, but the trouble had been
settled. The following figures, compiled for the most
part by the Bureau o f Labor Statistics, reflect the trends
o f employment and payrolls in. the Fifth district from
April to M ay:
Percentage change from
April 1940 to May 1940
in number
in amount
on payroll
of payroll

STATES
...........
Dist. of Columbia .............................. ...........
........
West Virginia .................................... ...........
North C arolina....................................
South C arolina....................................

+
+
-

1.1
2.2
0.4
0.0

+
+
+
+
—
—

1.9
2.2
1.4
4.2
2.9
1.0

SALES OF AU TOS HOLD UP

Registrations of new passenger automobiles in the
Fifth district in May ran seasonally behind April regis­
trations, but were 19 per cent ahead o f those in May
1939. Cumulative sales o f new cars in the first 5 months
of 1940 exceeded sales in the corresponding period last
year by 25 per cent. Sales of automobiles slumped dur­
ing the middle third of May when the war became active
in Europe, but during the last third o f the month sales
again picked up rapidly. Factory shipments have some­
what more than kept up with retail sales o f cars, and
dealers have complete stocks o f both new and used cars
on hand. There is some evidence that a number o f
persons who have always bought used cars are now
buying new ones. The following registration figures for

3

MONTHLY REVIEW
new passenger cars were furnished by R. L. Polk & Co.,
o f Detroit:

the Fifth district, bituminous coal mined in M ay 1940,
April 1940, and May 1939, was as follow s:

REGISTRATION OF N E W PASSENGER CARS— NUMBER
STATES

May
1940

Maryland ...........
Dist. of Col. . . .
Virginia .............
West Virginia . .
No. Carolina . . .
So. Carolina . . .
District ...........

5,048
2,982
4,996
3,255
4,727
2,615
23,623

May
1939
3,959
2,567
4,457
2,167
4,302.
2,370
19,822

%

Change
+
+
+
+
+
+

28
16
12
50
10
10

+

19

5 Months 5 Months
1940
1939
21,829
12,108
23,098
12,919
22,749
12,876
105,579

SOFT COAL PRODUCTION IN TONS
%

Change

17,123
11,555
17,735
8,578
18,828
10,657
84,476

+
+
+
+
+
+
+

27
5
30
51
21
21
25

BU ILDIN G PERM ITS A N D C O N TR A C TS RISE

The aggregate value o f building permits issued in May
in 31 Fifth district cities was $12,665,284, an increase o f
10 per cent over permits totaling $11,524,997 issued in
May 1939, and 21 per cent above $10,501,877 in April
1940. Baltimore led in valuation for M ay permits with
$5,176,278, Washington was second with $2,384,838,
Richmond third with $640,467, Charlotte fourth with
$377,096, and N orfolk fifth with $370,563. Charleston,
W . Va., and Columbia, S. C., also exceeded $300,000 in
permits last month. Eighteen of the 31 reporting cities
showed increased valuation figures last month over May
1939 figures.
Contracts actually awarded for all types o f construc­
tion in the Fifth district in May totaling $39,339,000 ex­
ceeded May 1939 contracts by 24 per cent, and were also
24 per cent above April 1940 awards. F. W . Dodge
Corporation reports that a substantially larger part o f
this year’s contracts is for residential work and private
industry, with a corresponding decline in publicly financed
engineering projects. The Dodge Corporation figures for
contracts awarded in the Fifth district in May 1940 and
May 1939 are as follow s:
May 1940

May 1939

%

Change

Maryland ..........................................
$ 9,746,000
$ 7,491,000
+ 30
Dist. of Col........................................
10,374,000
6,027,000
+ 72
Virginia ............................................
7,262,000
5,824,000
+ 25
West Virginia ................................
3,681,000
2,836,000
30
North C arolina...............................
5,785,000
6,102,000
— 5
South Carolina ............................. ............. 2,491,000_______3,339,000_______ — 25
Fifth District .............................
$39,339,000
$31,619,000
+ 24

C O A L PRO D U CTIO N A B O V E SE ASON AL LE V E L

Bituminous coal production has been above seasonal
level for several weeks, due chiefly to heavy exports
through Hampton Roads and over the Lakes to Canada,
and secondarily to increased activity in some coal con­
suming industries such as steel.
Production in May
totaled 35,468,000 net tons, an average o f 1,343,000 tons
per working day, while April showed a total o f 32,962,000
tons, or 1,313,000 tons per day. In May 1939 only 682,000 tons per day were dug, due to shut-downs in Eastern
mines about half the month because of labor trouble.
Total output of United States mines this year to June
8 o f 196,633,000 tons exceeded 1939 output to the same
date by 38.5 per cent. Hampton Roads ports loaded
10,664,327 tons between January 1 and June 8, 1940, an
increase o f 36 per cent over loadings in the correspond­
ing period last year, while Lake loadings rose from 4,385,043 tons in the 1939 period to 13,713,834 tons in 1940. In




May 1940

Apr. 1940

West Virginia .......................
Virginia ....................................
Maryland ..................................
5th District . .................

10,988,000
1,278,000
104,000
12,370,000

9,758,000
3,143,000
1,115,000
379,000
110,000___________ 49,000
10,983,000
3,571,000

May 1939

United States .................
% in District . .............

35,468,000
34.9

32,962,000
33.3

17,927,000
19.9

C O TTO N T E X T IL E A C T IV IT Y CH AN G ES LITTLE

Although mill output o f textile products exceeded sales
in April and May, relatively little curtailment in opera­
tions has occurred since March, when there was a sub­
stantial decline from the January and February levels.
Cloth prices declined somewhat in M ay for practically
all constructions, and spot cotton prices also dropped dur­
ing the first half o f the month. A fter mid-May cotton
turned upward, and in June cloth prices followed the
advance, recovering most o f the May decrease. The week
ended June 15 witnessed a spurt in cloth and yarn sales,
and print cloth sales were reported as much larger than
mill output. Mill margins, or the difference between the
price o f a pound o f cotton and its approximate cloth
equivalent,, averaged 11.37 cents during May against 11.40
cents in April and 9.33 cents in May 1939. Consumption
of cotton by states in the Fifth district in May 1940,
April 1940, and May 1939, is shown below:
COTTON CONSUMPTION— FIFTH DISTRICT
In Bales
Virginia

District

May, 1940 .............................
April 1940 ...........................
May 1939 ...............................

165,046
166,746
159,984

135,288
128,493
120,746

13,628
14,383
11,556

313,962
30,9,622
292,286

5 Months, 1940 ...................
5 Months, 1939 ...................

CONSTRUCTION CONTRACTS AW ARDED
STATES

REGIONS

MONTHS

No. Carolina So. Carolina

860,155
775,360

667,105
587,598

68,024
58,264

1,595,284
1,421,222

R A Y O N Y A R N PRO D U CTIO N INCREASES

Rayon Organon says that deliveries of rayon filament
yarn to domestic consumers in May 1940 amounted to
32,100,000 pounds as compared with 30,700,000 pounds
in April and 26,300,00 pounds in May 1939. Production
was slightly aibove shipments, however, and stocks o f
yarn in primary hands rose from 11,700,000 pounds on
April 30 to 12,200,000 pounds on May 31. This surplus
is only a 'two weeks’ supply, and is but 29 per cent o f a
reserve stock o f 41,700,000 pounds held on May 31, 1939.
In the first 5 months o f 1940, shipments o f 153,100,000
pounds o f yarn set a record for the January-May period.
Rayon producers have been informed o f an increase o f
$5 per ton for rayon dissolving pulp to be delivered be­
tween July 1 and September 30, 1940, the new price
being $85. In recent years rayon pulp prices have ranged
from a low o f $72.50 to a peak o f $97.50 per ton.
CO TTO N PRICES R E G A IN RECEN T LOSS

Spot cotton prices on 10 Southern markets, which had
declined to 9.58 cents for middling grade on M ay 17,
rose thereafter each week to 10.68 cents on June 14, the
latest date for which official data are available. Surplus
stocks o f cotton in the United States are now about

MONTHLY REVIEW

4

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

2,000,000 bales less than stocks in storage a year ago,
and consumption figures continue substantially higher

DEPARTMENT STORE TRADE

than in 1939.
COTTON CONSUMPTION AN D
May
1940
Fifth district states:
Cotton consumed .

313,962

ON HAND— BALES
May
1939
2)92,286

Cotton growing states:
549,818
516,637
Cotton consumed ..............
Cotton on hand May 31 in
Consuming establishments . .
1,048,533
977,048
Storage & compresses ........... 10,022,709 12,376,643
United States:
Cotton consumed ...................
Cotton on hand May 31 in
Consuming establishments
Storage & com presses-----

636,467

2,161,759

2,769,841

5,619,728

4,878,602

6,591,195

142,577

Same stores by states,
with 26 stores added:
Virginia (13) . . .
West Va. (10) . .
No. Carolina (9).
So. Carolina (11)

4* 4.1
+ 16.5
+ 11.4
+ 13.9

+
+
+
+
+

32.6
32.6
28.9
29.9
30.4

+
+
+
+
+

5.0
6.2
5.3
8.2
5.9

8.5
5.9
5.8
0.8
5.5

—
—
—
—
—

0.7
1.5
2.8
3.9
2.2

+ 4.6
+ 13.1
+ 8.7
+ 11.6

% Change in Sales, May and 5 Months in ]

5,921,431

3,106,675

EXiPORTS OF DOMESTIC COTTON— BALES
In 10 months ending May 31,
1939
1940
COUNTRIES
383,702
1,820,778
Great Britain ................................
331,897
712,151
France ............................................
251,777
536,256
Italy ..................................................
292,061
18,992
Germany ..........................................
15,570
268,359
Spain ................................................
83,594
199,899
Belgium ..........................................
580,166
571,236
Other European ...........................
817,523
837,608
Japan ..............................................
82,545
402,464
China .................................................
190,837
352,271
Canada ..............................................
77,003
All Other ........................................ ........................ 201,417
3,106,675
5,921,431
Total ............................................

TO B A C C O M A N U F A C T U R IN G INCREASES

All tobacco products increased in May over April, while
all but cigarettes declined in comparison with May last
year. Bureau o f Internal Revenue figures show produc­
tion figures as follow s:
May 1940




5.3
2.7
2.3
8.2
3.7

RETAIL FURNITURE SALES

American cotton growers depend upon foreign markets
to take a substantial part o f their crop, but conditions in
Europe make future demands for cotton highly doubtful.
France, Italy, Belgium and Germany took nearly a mil­
lion and a half bales o f American cotton in 10 months
ended M ay 31, but their purchases will be very small as
long as Great Britain maintains her naval supremacy.
Much o f the increase in exports to England shown in
the accompanying table was due to an arrangement under
which the United States exchanged government owned
cotton with England for crude rubber.

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

+
+
+
+
+

Ratio May
collections
to accounts
outstanding
May 1

5,758,637

22,217,302 21,970,202

Spindles active, U . S.

Richmond (3) . . .
Baltimore (8) . . .
Washington (6) .
Other Cities (14)
District (31)

1,314,105 1,175,357
10,087,027 12,422,259
226,469

Exports of cotton, U. S.

606,090

Aug. 1 to May 31
This Year Last Year

Net Sales
Stocks
J an. 1 to date May 31, 1940
comp, with
comp, with
Apr.
same period May
1940
last year
1939

Net Sales
May 1940
comp, with
May
1939

April 1940

May 1939

26,457,385
16,274,867,793
469,313,069
3,466,676

25,082,562
14,819,507,680
425,140,424
3,398,017

26,973,918
15,445,195,753
470,579,558
3,525,026

STATES
Maryland, 9 stores ............... .........
Dist. of Col., 7 s to r e s ........... .........
Virginia, 9 stores ................. .........
North Carolina, 4 stores . . . .........
South Carolina, 7 stores . , .........
District, 36 stores ............. .........
Individual cities:
Baltimore, 9 stores ............. .........
Richmond, 4 stores ...............
Washington, 7 stores ........... .........

Compared with
May 1939
+15
+ 0
+
8
+15
+16
+ 9
+15
+

o

Compared with
5 Months 19319
+ 21
+
7
+
7
+ 13
+ 19
+ H
+ 21
— 0
+
7

W HOLESALE TRADE, 192 FIRMS

LINES
Auto Supplies (5) .........
Shoes (5) ...........................
Drugs (13) .......................
Dry goods (8) ...................
Electrical goods (16) . . .
Groceries (58) .................
Hardware (16) ...............
Industrial supplies (11)
Plumbing & heating (4)
Paper & products (6)
Tobacco & products (7 ).
Miscellaneous (43) .........
District Average (192)

Net Sales
May 1940
compared with
May
April
1939
1940
+ 4
— 10
— 10
— 13
+ 0
+ 6
+ 11
+ 11
+ 27
+ 6
+ 9
+ 4
+ 5
+ 3
+ 32
— 2
— 8
+ 1
+ 15
— 3
+ 9
+ 9
+ 14
+ 11
+ 10
+ 4

Stocks
Ratio May
May 31, 1940
collections
compared with
to accounts
May 31 Apr. 30 outstanding
1939
1940
May 1
60
+ ii
— *8
57
— 1
87
+ 3
+22
— 4
43
+ 11
+ 0
69
+ 5
— 0
94
+ 11
— 2
45
+ 13
66
+ 1
56
+ '4
— 5
101
— 6
— 8
86
— 3
77
+ 3
+ 8
— 3
619

A G R IC U L T U R A L NOTES

Wheat and peaches are the only crops for which 1940
prospective yield figures have been issued Total wheat
yield this year for the Fifth district is forecast at 24,440,000 bushels, approximately the same as 24,480,000
bushels in 1939 but less than the ten-year average pro­
duction o f 25,169,000 bushels. Maryland and Virginia
are expected to excell last year’s wheat crops, but W est
Virginia and the two Carolinas apparently have smaller
crops this year. Peaches are turning out better than was
expected, and the district's prospective crop o f 4,793,000 bushels is higher than either the 1939 yield o f 4,708,000 bushels or the ten-year average crop o f 4,624,000
bushels. N o forecasts o f apple production have been
made, but condition figures for Fifth district states were
all higher on June 1 this year than a year earlier, and
were higher in all states except North Carolina than the
ten-year average as o f June 1.

(Compiled June 21, 1940)

MONTHLY REVIEW, June 30, 1940

FEDERAL RESERVE BANK OF RICHMOND

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

INDUSTRIAL PRODUCTION

Industrial activity increased considerably in M ay and the first h a lf o f June,
w hile prices o f commodities and securities declined sharply in the middle o f M ay
and fluctuated near the low er levels a fter that time. D istribution o f com m odi­
ties to consum ers was m aintained at levels prevailin g earlier this year.

PRODUCTION

Index of physical volume of production, ad­
justed for seasonal variation, 1923-1925 averages
100. By months, January 1934 to May 1940.

CONSTRUCTION

CONTRACTS AWARDED

Three-month moving averages of F. W . Dodge
Corporation data for value of contracts awarded
in 37 Eastern States, adjusted for seasonal varia­
tion. Latest figures based on data for April and
May and estimate for June.

MONEY

RATES IN NEW YORK CITY

Volum e o f industrial production increased in M ay and the B oa rd ’s season­
ally adjusted index advanced from 102 to 105. The rise in M ay reflected chiefly
sharp increases in activity at steel mills and w oolen m ills. Steel production in
M ay w as at about 71 per cent o f capacity, as com pared w ith 60 in A pril, and
by the third week o f June activity had risen fu rth er to 88 per cent. Lum ber
production also increased. In the autom obile industry, w here output had been
at a high rate in the first fo u r months o f the year, dealers’ stocks w ere in large
volume and production w as curtailed in M ay and the first h a lf o f June. Retail
sales o f automobiles continued at a high level during m ost o f M ay, although in
the middle o f the month a tem porary sharp reduction w as reported.
In the w oolen textile industry activity in M ay rose sharply from the low
level reached in A pril. A t cotton mills activity w as m aintained at about the
rate prevailin g in M arch and A p ril and w as som ewhat low er than in the early
months o f the year. Rayon production continued large, w hile mill takings o f
raw silk declined to the low est level in nearly tw enty years. In other indus­
tries producin g nondurable m anufactures activity generally showed little change
from A p ril to May.
Coal production in M ay continued at a high level fo r this time o f the year,
reflecting in p a rt increased exports and unusually la rge shipments o f coal to
U pper Lake ports. Iron ore shipments down the Lakes w ere also large fo r this
season. Petroleum production in M ay declined som ewhat from the high rate
m aintained in M arch and A pril.
Value o f construction contract aw ards increased fu rth er in M ay, according
to figures o f the F. W . D odge Corporation, reflecting prin cipally continued grow th
o f private building. P rivate residential contracts rose to the highest level in
the past 10 years. A w ards fo r com m ercial buildings advanced som ewhat fu r ­
ther w hile those fo r fa c to r y construction continued at about the level reached
in A pril. Both were considerably la rg er than a year ago. Contracts fo r public
construction increased slightly in M ay but w ere about one-sixth low er than a
year earlier.

DISTRIBUTION
D epartm ent store sales in M ay declined from the level prevailin g in the
past three months, while sales at variety stores and m ail-order houses w ere
largely m aintained at earlier levels. In the first week o f June departm ent store
sales increased considerably.
Volum e o f railroad fre ig h t traffic increased in M ay, reflecting la rg er ship­
ments o f m iscellaneous merchandise, coal, and forest products. L oadings o f
grains declined.

FOREIGN TRADE

For weeks ending January 6, 1934, to June 15,
1940.

Total exports o f United States m erchandise showed little change fro m A p ril
to M ay. Increases w ere reported in shipm ents to Canada and A u stra lia and
to Ita ly and Finland, w hile exports to other European nations showed declines.
E xports o f industrial m achinery in M ay declined som ewhat from the high level
reached in A pril, while exports o f steel, copper, chem icals, and com m ercial
vehicles increased, follow in g declines in the previous month. Coal shipments,
largely to Canada, rose to the highest level in recent years. Cotton exports
continued to decline from the high level o f last w inter.
The m onetary gold stock o f the U nited States increased by $439,000,000 in
M ay and by $250,000,000 in the first tw o weeks o f June.

COMMODITY PRICES
MEMBER BANKS IN 101 LEADING CITIES

F ollow in g a general decline in basic com m odity prices around the middle o f
M ay, prices o f industrial m aterials, p a rticu la rly steel scrap, zinc, tin, and w ool,
advanced and by the middle o f June w ere in some instances above the levels o f
early M ay. Raw cotton prices also increased, and in the second week o f June
prices o f cotton gray goods likewise advanced as sales o f these goods w ere in
exceptionally large volum e. P rices o f a num ber o f foodstuffs continued to
decline.

BANK CREDIT
Total loans and investm ents at reportin g mem ber banks in 101 leading
cities showed little net change during the fo u r weeks ending June 5. H oldings
o f United States Governm ent obligations increased fu rth er at N ew Y ork City
banks, w hile loans to security brokers and dealers declined considerably. D e­
posits and reserves o f member banks continued to increase sharply as a result
m ainly o f heavy gold im ports.
Wednesday figures, September 5, 1934, to June
12, 1940. Commercial loans based on new classifi­
cation beginning May 19, 1937.




GOVERNMENT SECURITY MARKET
Prices o f Governm ent securities held relatively steady during the latter
pa rt o f M ay and the first p a rt o f June, a fter a reaction at the time o f the
invasion o f Belgium and Holland. Subsequently prices increased sharply, and
on June 15 the yield on the 1960-1965 bonds w as 2.40 per cent, com pared w ith
2.52 per cent on June 10 and 2.26 per cent at this y ear’s peak in prices on
A p ril 2.