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F E D E R A L R E S E R V E BAN K O F RICHMOND
General Business and Agricultural Conditions in the
Fifth Federal Reserve District
By C A LD W ELL HARDY, Chairman and Federal Reserve Agent

MARCH 31, 1923

RICHMOND, VIRGINIA
DISTRICT SUMMARY
February being a between-seasons month, active
business is not expected by merchants and middle­
men, but February of this year measured up higher
than the corresponding month last year, and fell very
little short of January of this year. All reports re­
ceived during the month under review indicated a
strong probability of satisfactory spring and early
summer trade, with employment for all who
want to work. Member banks reporting weekly to
the Federal Reserve Bank showed increased loans
as their customers prepared for crop planting and
mercantile and industrial activity with the passing
of winter. Savings bank figures continued to rise in
both member and non-member banks, reflecting at
least a reasonable degree of prosperity among wage
earners, and the first installment of income taxes
collected by the United States proved that 1922 in­
comes were considerably above those of 1921.
These tax returns indicated also that money was
more plentiful on March 15th than was the case
last year, this deduction being drawn from the fact
that more persons than in previous years paid their
entire income tax at the first payment date instead
of paying the tax in four installments. Loans to
member banks increased during February in the Re­
serve Bank, but Federal Reserve Notes in circulation
declined. The ratio of cash to combined liabilities
for reserve deposits and note circulation in the Fed­
eral Reserve Bank of Richmond stood at 73.50% on
March 14, 1923, in comparison with 54.62% on
March 15, 1922. Debits to individual, firm and cor­
poration accounts in leading trade centers of the dis­
tract during the four weeks ending March 14, 1923,
were 19.4% greater than debits in the same cities
during the corresponding four weeks of 1922, and
totaled only a fraction of 1 % less than the debits for
the four weeks ending February 14, 1923. Business
failures in the Fifth District in February fell 48.8%
in number under the February 1922 failures and also




declined 48.5% in total liabilities involved. Labor
was fully and profitably occupied during the month,
and bad weather interferred very little with outside
work. Food prices decreased slightly between Janu­
ary 15th and February 15th, and some of the de­
creases were on articles of wide consumption such
as eggs, though the gain in this article to the con­
sumer was offset by recent advances in sugar, an­
other widely used commodity. Coal production de­
creased in February under January’s output, but
continued sufficient to meet current needs, and the
near approach of spring promised relief from coal
bills to consumers who use it for house heating.
Textile mills continued on full time schedules during
February, with orders in sufficient numbers to take
the output for several months, and cotton mill stock
quotations reached higher levels than in many
months. February’s cotton consumption broke all
February records, and the cotton consuming states
in the Fifth District used their full share of
the record amount. Spot cotton prices advanced
nearly two cents per pound during the past month.
Tobacco prices during February averaged higher
than 1922 prices on both bright and dark mar­
kets, and growers generally feel that their season
has been a successful one. Good progress was
made by planters in preparing the ground for
this year’s crops, and farmers bought more mules,
new machinery and fertilizer this spring than they
did in either 1921 or 1922. A larger number of
farmers paid cash for their supplies than usual.
February building activitities continued in increasing
volume, the number of permits issued for new work
breaking available records for the corresponding
month in previous years, and total valuation figures
kept pace with the number of permits. Both retail
and wholesale trade fully met expectations, and col­
lections were reported fairly satisfactory, though
somewhat slower than in January.

The National Summary will be found on pages 10 and 11.

CONDITION OF SEVENTY-EIGHT REPORTING MEMBER BANKS IN SELECTED CITIES.
ITEMS

March 7, 1923

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

453,564,000

February 7, 1923
$

444,969,000

March 8, 1922
$

418,467.000*

132.789.000
586.353.000

135.317.000
580.286.000

116.649.000
535,116,000*

36.386.000
13.706.000
336.886.000
152.514.000
24.297.000

37.886.000
13.305.000
341.210.000
149.495.000
21.754.000

33.289.000
13.762.000
304.839.000
131.691.000
32.522.000

*Does not include Rediscounts.

The above table gives a comparative statement of the principal items of condition in seventy-eight regu­
larly reporting member banks, located in thirteen cities of the Fifth District, as of the close of business March
7 and February 7, 1923, and March 8, 1922. As we stated last month, the figures in Item 1 for the two 1923
dates are not comparable with the March 8, 1922 figure, the 1923 figures including all rediscounts, but the
1922 figure excluding them. All other items in the table are comparable.
Comparing the March 7, 1923 figures with those reported a month earlier, February 7, 1923, the begin­
ning of the usual spring expansion is shown. Item 1, Total Loans and Discounts (including all rediscounts),
increased from $444,969,000 on February 7th to $453,564,000 on March 7th. Between the same two dates,
Item 2, Total Investments in Bonds and Securities, declined from $135,317,000 to $132,789,000; Item 4, Re­
serve Balance with Federal Reserve Bank, decreased from $37,886,000 to $36,386,000; and Item 6, Demand
Deposits, dropped from $341,210,000 to $336,886,000. All of these changes indicate an increased demand
upon the banks for funds during the four weeks under review, and Item 8, Borrowed from Federal Reserve
Bank, with an increase from $21,754,000 on February 7th to $24,297,000 on March 7th further indicates the
beginning of spring activity in business. The table shows an increase during the four weeks in Item 7, Time
Deposits, this figure having increased from $149,495,000 on February 7th to $152,514,000 on March 7th.
A comparison of the March 7, 1923 figures with those reported for March 8, 1922 shows marked im­
provement this year in the condition of the reporting banks. As stated above, the two figures shown for Item
1, Total Loans and Discounts, are not comparable, but the changes in other items show clearly that credit is
much easier now than it was a year ago. For example, Item 2, Total Investments in Bonds and Securities,
shows an increase from $116,649,000 so invested on March 8, 1922 to $132,789,000 on March 7, 1923. Item
4, Reserve Balance with the Federal Reserve Bank, rose from $33,289,000 on March 8, 1922 to $36,386,000
on March 7, 1923. Item 6, Demand Deposits, increased from $304,839,000 on March 8th last year to $336,886,000 on March 7th this year, and Item 7, Time Deposits, increased from $131,691,000 to $152,514,000
between the same two dates. Finally, Item 8, Borrowed from the Federal Reserve Bank, decreased from
$32,522,000 on March 8, 1922, to $24,297,000 on March 7, 1923. The most striking thing shown in the
table is the large gain in Item 7, Time Deposits, the steady increase in this item during the past three years
apparently indicating that the thrifty habits formed during the war have borne good fruit. On March 5, 1920,
the same banks had Time Deposits amounting to $98,755,000, and this was at the crest of post-war pros­
perity. The depression was in full swing by March 4, 1921, but in spite of the changed conditions Time De­
posits totaled $112,421,000 on that date. During 1921 and early in 1922 there was a great deal of unem­
ployment, both voluntary and involuntary, but as shown in our table Time Deposits aggregated $131,691,000 on
March 8, 1922, and rose to $152,514,000 by March 7, 1923, an increase of 54.4% over the aggregate of
deposits on March 5, 1920.
SAVINGS BANK DEPOSITS
Reports from fifteen mutual savings banks in Baltimore giving total deposits at the end of February
show an increase over the January 31, 1923 and the February 28, 1922 deposits that corresponds with the
increase mentioned in the preceding paragraphs for reporting member banks. At the close of business Feb­
ruary 28, 1923 the fifteen savings banks had on deposit an aggregate of $134,045,000, compared with $124,282,395 on deposit February 28, 1922, $122,742,831 on deposit February 28, 1921, and $119,097,809 on de­
posit February 28, 1920. Only two of the fifteen banks reported a smaller volume of deposits on February
28, 1923 than on February 28, 1922, and both of these were small institutions. The deposits on February
28, 1923 represent a gain of 12.6% over the total of deposits on February 28, 1920.
FEDERAL RESERVE BANK OPERATIONS
During the four weeks between February 14, 1923 and March 14, 1923, Cash Reserves held by the
Federal Reserve Bank of Richmond declined from $117,753,753.04 to $110,818,733.67, and Member Bank




2

Reserve Deposits decreased from $62,424,579.24 to $61,349,130.26. Between the same two dates, Total
Bills on Hand increased from $38,818,335.26 to $44,242,799.33. Federal Reserve Notes in Actual Circu­
lation amounted to $89,033,215 on February 14th, but declined to $84,975,640 on March 14th. As a result of
the changes in the items referred to, the ratio of Total Reserves to Deposit and Federal Reserve Note Lia­
bilities combined declined from 76.51 % on February 14th, to 73.50% on March 14th. In view of the
expansion of credit demands, evidenced in increased loans to member banks as mentioned above, the decrease
in note circulation may appear as an unusual development, but the upward or downward movement in the
volume of notes in circulation does not at all times follow the movement in the volume of loans. After Christ­
mas both loans and notes in circulation tend to decline while bills made during the fall are being liquidated
and the surplus cash required for the holiday is being retired. By the middle of February credit requirements
for early spring trade and for agricultural work begin to be felt, and loans tend to increase, but the upward
turn in note circulation does not necessarily follow immediately. In rediscounting with the Reserve bank, mem­
ber banks do not call for much cash at this season of the year, but instead they have the credit secured by
rediscounting placed to their account on the books of the Reserve Bank and check against the credit as it
is needed.
On March 15, 1922, the Cash Reserves of the Federal Reserve Bank of Richmond amounted to $81,840,834.14; Total Bills on Hand amounted to $75,332,726.27; Federal Reserve Notes in Actual Circula­
tion totaled $95,974,509; and Member Bank Reserve Deposits amounted to $55,176,242.22. The reserve ratio
was 54.62%.
DEBITS TO INDIVIDUAL ACCOUNT IN LEADING TRADE CENTERS
TOTAL DEBITS FOR THE FOUR WEEKS ENDING
CITIES

February 14, 1923

March 14, 1923

Asheville, N. C................................................
Baltimore, Md.................................................
Charleston, S. C...............................................
Charleston, W. Va...........................................
Charlotte, N. C................................................
Columbia, S. C.................................................
Cumberland, Md..............................................
Danville, Va.................................. ..................
Durham, N. C..................................................
Greensboro, N. C.............................................
Greenville, S. C................................................
Hagerstown, Md..............................................
Huntington, W. Va..........................................
Lynchburg, Va.................................................
Newport News, Va..........................................
Norfolk, Va......................................................
Raleigh, N. C...................................................
Richmond, Va..................................................
Roanoke, Va....................................................
Spartanburg, S. C............................................
Washington, D. C............................................
Wilmington, N. C.............................................
Winston-Salem, N. C.......................................

$

Totals for 21 cities................................

$

18,874,000*
336.200.000
36.729.000
32.851.000
36.932.000
25.287.000
7.329.000
8.203.000
17,424,000*
20.295.000
22.076.000
8.328.000
25.627.000
18.484.000
6.617.000
66.361.000
26.700.000
115.097.000
20.635.000
11.043.000
169.406.000
21.348.000
30.136.000
1,045,684,000

$

$

19,515,000*
333.200.000
39.910.000
34.632.000
33.938.000
22.390.000
6.929.000
11.131.000
17,241,000*
21.990.000
22.100.000
7.754.000
23.207.000
18.907.000
6.741.000
64.829.000
27.450.000
124.333.000
20.854.000
9.495.000
173.755.000
19.546.000
29.236.000
1,052,327,000

March 15, 1922
$

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

312.992.000
23.379.000
27.103.000
24.026.000
19.419.000
6.594.000
7.423.000
12.679.000
13.345.000
6.767.000
16.754.000
16.384.000
5.806.000
52.289.000
14.965.000
102.730.000
17.217.000
7.255.000
151.637.000
18.260.000
18,813,000

$

875,837,000

*Not included in totals.

In the accompanying table, shown above, we give in tabular form the volume of debits to individual,
firm and corporation accounts in twenty-three leading centers of trade and industry in the Fifth Reserve
District, the figures included covering the four weeks ending March 14, 1923 and the four weeks ending
February 14, 1923. In addition, we include comparative figures for twenty-one of the twenty-three cities
for the four weeks ending March 15, 1922. Debits figures show the total of all checks charged to depositors’
accounts, and include all checks cashed over the counter, all pay roll checks, all dividend and interest checks,
and all payments of current bills if paid by check. The totals of these items therefore form a valuable
barometer of business activity.
Comparing the totals reported by twenty-one cities for the four weeks ending March 14, 1923 with the
figures reported for the preceding four weeks, ending February 14th this year, a small decrease is shown
during the later period, the totals for the period ending March 14th being $1,045,684,000 compared with
$1,052,327,000 reported for the corresponding period ending February 14th. The decrease is seasonal, the




3

period ending February 14th including many late payments on Christmas purchases and the period ending
March 14th being too early to include any appreciable volume of spring trade settlements. In addition, the
period ending March 14th just precedes the first payment date on income taxes, and these tax demands un­
doubtedly tend to postpone other payments at this season.
The gain shown by the March 14, 1923 figures over those reported for the corresponding four weeks a
year ago is indicative of the greater activity of business this year, and reflects also to some extent the in­
crease in prices. The four weeks ending March 14, 1923 show totals aggregating $1,045,684,000 compared
with $875,837,000 reported on March 15, 1922 for the corresponding four weeks last year, representing a gain
this year of 19.4% . Every section of the District appears to be sharing in the increased business, since every
reporting city shows larger figures for the four weeks ending March 14th this year than for the corre­
sponding period last year.
BUSINESS FAILURES IN THE TWELVE FEDERAL RESERVE DISTRICTS
FEBRUARY, 1923 AND 1922.

1923

1922

Per Cent
Increase or
Decrease

Boston, First.....................................
New York, Second............................
Philadelphia Third..........................
Cleveland, Fourth.............................
Richmond, Fifth................................
Atlanta, Sixth...................................
Chicago, Seventh..............................
St Louis, Eighth...............................
Minneapolis, Ninth...........................
Kansas City, Tenth..........................
Dallas, Eleventh...............................
San Francisco, Twelfth....................

150
262
58
121
109
135
195
81
72
89
91
145

206
300
93
235
213
270
288
167
97
99
207
156

—12.7
—37.6
—48.5
—48.8
—50.0
—32.3
—51.5
—25.8
—10.1
—56.0
— 7.1

$ 4,637,721
8,883,288
1,024,670
6,293,852
2,452,891
4,029,704
3,081,365
1,008,734
2,217,789
1,154,384
2,104,596
3,738,945

$ 6,235,271
24,202,858
2,436,402
4,627,038
4,761,744
5,331,050
7,876,931
4,653,231
2,300,814
2,006,480
5,889,143
2,287,431

— 25.6
— 63.3
— 57.9
36.0
— 48.5
— 24.4
— 60.9
— 78.3
— 3.6
— 42.5
— 64.3
63.5

Totals........................................

1,508

2,331

—35.3%

$ 40,627,939

$ 72,608,393

— 44.0%

Number
City and District

—

27.2

Liabilities
1923

1922

Per Cent of
Increase or
Decrease

The figures on business failures given in the table herewith were furnished by Dun’s Review, and
show both the number of insolvencies and the total of liabilities involved for February 1923 in comparison
with February 1922. Statistics for all twelve Federal Reserve Districts are included. February 1923 wit­
nessed a total of 1,508 bankruptcies, with liabilities of $40,627,939, compared with 2,331 failures reported in
February 1922, with liabilities of $72,608,393, a decrease this year of 35.3% in the number of failures and
a decline of 44.0% in the total of liabilities involved. All of the Reserve Districts show fewer failures this
year than last, and ten of the twelve districts show lower liabilities, the two showing greater liabilities being
the Cleveland and San Francisco districts. The number of failures reported for February 1923 is the low­
est number of insolvencies reported for the nation for any month since September 1921.
In the Fifth District, February 1923 shows a gratifying decrease in the number of failures in comparison
with February 1922, the current month this year having witnessed only 109 insolvencies in comparison with
213 in February last year, a decline of 48.8%. In the total of liabilities involved, also, the Fifth District
shows distinct improvement, the February 1923 total of $2,452,891 being 48.5 % lower than the total of
$4,761,744 reported in February 1922. With the exception of the months of October and December of last
year, when 91 and 108 insolvencies were reported, respectively, the February 1923 number of failures is the
lowest number for any month since October 1921. The Fifth District percentages of decrease in both the
number of failures and the amount of liabilities involved in February of this year in comparison with Feb­
ruary 1922 are greater than the average decreases for the twelve Reserve Districts.
The average liability per failure in the Fifth District was $22,504 during February 1923, compared with
$22,356 in February 1922, and the average liability in the United States was $26,942 during February 1923
compared with $31,149 in February 1922.
LABOR— No particular changes have taken place in labor circles since our February 28th Review was
written. The demand for workers in the building trades is greater than the available supply, a condition which
appears to be national in extent, to judge from Secretary Hoover’s recent recommendation that all government
and municipal work be stopped or slowed down in order to release workmen for private enterprises. Farm
laborers are comparatively scarce, the Department of Agriculture stating that a serious shortage of labor
exists in the Eastern Shore counties of Maryland and in the bady weevil infested cotton areas to the south
of Virginia. Clerical workers are abundant for all needs, and there are sufficient mechanics desiring work to
meet employers’ calls. Domestic help continues unsatisfactory and hard to secure, and workers by the day are




4

less plentiful than they were a few months ago. There was some bad weather in February, which handicapped
outside workers, but on the whole the winter has been exceptionally mild and open, and unskilled labor has
therefore been more regularly employed than usual. A number of lumbering companies report difficulties in
securing sufficient labor to run their plants to capacity, and there is some complaint of a rather high turn-over
in labor. Some of our correspondents blame high rents for this apparent unrest that exists among workers,
especially unskilled and semi-skilled laborers, and others say that rising commodity prices in many lines are
making it harder for the workman to keep up with his living costs. But, in spite of reports of dissatisfied and
shifting labor that reach us, no serious troubles are discernible among workers at this time anywhere in the
Fifth District.
FOOD PRICES— The monthly report of the United States Bureau of Labor Statistics, released on
March 10, 1923, states that retail food prices declined in all of the twenty-two representative report­
ing cities during the month between January 15th and February 15th, both this year. The declines
ranged all the way from three percent in Salt Lake City down to less than five-tenths of one percent in Dallas
and Kansas City. Decreases of one percent during the month were reported for Baltimore, Norfolk, and
Washington, the three Fifth District cities included in the month’s report. For the year which ended Feb­
ruary 15, 1923, fourteen of the twenty-two cities show increases, ranging from four percent for Pittsburgh
downward to less than five-tenths of one percent for Philadelphia. Baltimore was in the list showing increases,
that city’s rise being one percent. Eight cities reported decreases for the year, thesebeing Omaha, Salt Lake
City and Scranton, two percent; Memphis and Washington, one percent; Manchester, N. H., Norfolk and San
Francisco, less than five-tenths of one percent. As compared with average costs during 1913, retail food
prices between January 15th and February 15th this year were fifty percent higher in Washington and fortyeight percent higher in Baltimore. Prices for 1913 are not available from Norfolk. Providence and Wash­
ington, with increases of fifty percent since 1913, lead the list of cities included in the report, and Salt Lake
City with an increase of twenty-one percent is at the bottom. For several months Richmond has shown a greater
increase over 1913 prices than any of the cities included in the latest available report, but for some reason
unknown to us Richmond was not included among the cities for which figures for the past month were re­
ported.
COAL— The United States Geological Survey, in its weekly report on coal production dated March 10,
1923, says, ‘‘Preliminary estimates placed the total output of soft coal, including lignite and coal coked at the
mine, at 42,130,000 tons in February of this year, a decrease from the production in January of approximately
16 percent. The two factors responsible for this decline were the less number of working days in February and
a decrease of more than 7 percent in the average daily rate of production.
The real test of the sufficiency of production is consumption. A canvass of a selected list of consumers of
coal indicated that domestic consumption plus exports during January was approximately 10,700,000 tons per
7-day week, and that approximately 2,000,000 tons of the January output were added to reserve piles. As­
suming that coal was burned at the same rate in February as in the month preceding, it appears that pro­
duction was about equal to consumption and that there was little change in consumers’ stocks.” In its March
17th report, the Survey says, “ The cumulative production of soft coal for the year 1922-1923 to March
10th stands at 388,425,000 tons. As compared with recent coal years the present year is 3.4 percent behind
1921-1922, 23.0 percent behind 1920-1921, 14.3 percent behind 1919-1920, and 26.7 percent behind 19181919. The cumulative totals to corresponding date for the last four years are as follows:
1918-191 9
1919-192 0

1920-1921-----------------504,339,000 net tons
1921-1922........ .............. 401,994,000 net tons

529,553,ooo net tons
------- 452,556,000 net tons

There have been no changes of importance to consumers in the retail end of the coal business during
the past month. Prices have remained unchanged in all the cities from which we have received reports, but
the coal buying period for home owners is nearing its end, and many users will obtain relief from the heavy
drain on their resources that was caused by the high prices during the past winter.
TEXTILES— The textile industry is perhaps the most active industry in the Fifth District at this time.
All of the mills in the Carolinas and Virginia are running full time, and a large percentage of them are oper­
ating at night in an effort to keep up with their orders. New mills are being erected or contracted for in the
Carolinas, particularly in North Carolina, and owners of old plants are building additions, enlarging their
villages by constructing more homes for operatives, and in many other ways are showing signs of prosperity.
But under this activity there is growing a feeling of uneasiness. During the past several months letters from
mill executives have been optimistic, and they continue so on the whole, but of late a note of uncertainty is
creeping into comments made by some of the best posted authorities in the industry. They write that orders
are being taken several months in advance, but they are calling attention to a possibility of the mills having to
operate on a falling cotton market during the latter part of 1923, if the cotton crop now being planned turns
out an average yield. Of course nothing definite is yet known as to the cotton acreage that will be planted this
year, but as mentioned in the paragraph on Cotton printed elsewhere in this Review, every indication points




5

to a considerable increase in acreage, and mill authorities are therefore expecting a considerably larger crop
this year. They appear to be afraid that if crop reports during the growing season bear out their expecta­
tions, they will have the effect of lowering cotton prices during the late summer and fall, which will make
profitable operations on cotton bought at high prices very difficult for them. Mill authorities are also ner­
vous as to the effect that rising cotton prices at the present time may ultimately have upon the demand for
cotton goods. All of our correspondents claim that prices asked for cotton goods have not advanced in keep­
ing with raw cotton, but they say that the prices of the finished product will doubtless have to be raised in line
with the costs of raw material. If this is done, they are wondering whether or not it will seriously cut down
buying by the ultimate consumer. On the whole, the situation appears to be that at the present time the
mills are operating profitably and at approximate capacity, but the outlook is complicated by the questions
raised, and calls for great caution on the part of the executives.
During February cotton consumption totaled 112,771 bales in North Carolina, 85,670 bales in South
Carolina, and 9,798 bales in Virginia, a total consumption of 208,239 bales for the three cotton manufac­
turing states in the Fifth District. This amount is 36.7 percent of total American consumption for Febru­
ary, which amounted to 556,924 bales.
COTTON— Since our February 28th issue of this Review, spot cotton prices in the Carolinas have risen
nearly two cents per pound. In the February issue, we quoted average prices paid for middling, upland short
staple cotton during the week ending February 17th, as 28.02 cents per pound. The week ending February
24th averaged 29.27 cents per pound, and during the week ending March 3rd prices rose to an average of 29.88
cents. The week ending March 10th witnessed a slight reaction from the rapid advance, the average for the
week being 29.75 cents, but the last week for which figures are available, the one ending March 17th, saw
prices rise to 29.90 cents, the highest weekly average since August 1920. The rise in price has not brought
out much spot cotton, though there was some selling by growers when the market reached 30 cents at cer­
tain places. It appears that most of the cotton is now being held by consuming establishments, cotton fac­
tors or co-operative associations, and there is little pressure on holders to sell. The bulk of the crop has of
course passed beyond the control of the growers, and therefore price changes are not influencing the marketing
of the staple as widely as has been the case in past years.
On March 14th, the Census Bureau gave out the cotton consumption figures for February 1923. The re­
port showed 566,924 bales of lint consumed in February, in comparison with 610,375 bales consumed in Jan­
uary 1923 and 473,336 bales used in February 1922. The consumption in February of this year was a record
for that month of the year. Cotton on hand at consuming establishments at the end of February totaled
2,021,903 bales, compared with 1,595,242 bales on hand February 28, 1922. Cotton held in public storage
and at compresses on February 28, 1923 amounted to 2,804,494 bales, compared with 4,214,862 bales so held
on February 28, 1922.
Plans are now being made for planting this year's cotton crop, and every indication points to a con­
siderable increase in acreage. Various estimates have been made as to the extent of this increase, but at best
estimates are usually worthless this early in the season. The weather during the next six weeks will influence
the acreage planted very materially, and labor problems will also react upon the acreage. Reports from
banks, merchants and fertilizer companies indicate that the farmers are buying considerably more fertilizer
this year than they did a year ago, which would seem to indicate an increase in acreage or a more intensive
cultivation. Probably the larger sales of fertilizer indicate that both assumptions are correct. There appears
to be much study and thought being given to farming under boll weevil conditions, particularly in South Caro­
lina where the weevil did very serious damage during the past two years, and many farmers in that state
will concentrate their attention on the intensive cultivation of a comparatively small acreage, but in North
Carolina reports indicate that a large acreage will be planted in an effort to make one more crop before the
weevil arrives in sufficient numbers to make its control a serious problem.
TOBACCO— The marketing season for tobacco on the bright markets of the District has been almost
completed and many warehouses have closed for the season. The dark markets will continue open at least
through March, and some of them will remain open through April. The sales of both bright and dark to­
bacco were less in February than in January, and prices were also lower than during earlier months this season,
but these are seasonal developments as the large quantities of scrap and low grade tobaccos come on the mar­
ket toward its close. On the whole, the season just closing has been a successful one for the growers, both
yields and prices having been generally considered good.
The Virginia markets sold 3,633,181 pounds of bright tobacco during February, compared with 5,028,985
pounds sold in January, and 10,643,662 pounds sold in February 1922, but it should be remembered that in
1922 the Co-operative warehouses were not open. The average price realized for bright tobacco during Feb­
ruary on the competitive markets was $26.17 per hundred pounds, compared with $29.02 per hundred paid
in January of this year and $13.98 per hundred paid in February 1922. There were 5,540,972 pounds of dark
tobacco sold in February, compared with 6,293,794 pounds sold in January 1923 and 6,217,179 pounds sold in




6

February 1922. Average dark tobacco prices were $19.00 per hundred in February 1923, $20.13 in January
1923, and $18.74 in February 1922. The Danville market led in bright tobacco sales during February
with a total of 1,734,956 pounds, but South Boston prices led all bright markets for the month, averaging
$29.77 per hundred pounds. Lynchburg led the dark markets with sales totaling 1,616,203 pounds, but Drake’s
Branch prices averaged $23.32 per hundred and led all the dark markets.
AGRICULTURAL NOTES— Farmers in the Fifth District are busy with their preparations for this
year’s operations, and on the whole the weather has been very favorable for early work. The chief interest
at this season is the prospect for fruit* and the outlook is fair to good. The extreme cold of March 20 and 21
probably did some damage to peach trees, especially in the Carolinas, but apple buds had not put out and the
Commissioner of Agriculture of Virginia is quoted in the press as stating that the cold spell will probably
prove a blessing to the apple growers. The low temperature is expected to delay the budding of the trees,
thus removing to a considerable extent danger of possible later frosts doing much damage to the crop.
Tobacco beds have been prepared throughout the district, and many of them have been planted. Some
damage has been done to grain in Virginia by freezing. Truck crops on the coast of the Carolinas were mak­
ing good growth up to the middle of March, but it is possible that the freeze of March 20th did serious dam­
age in that section. Preparation of corn land is in full swing in the southern states, and potatoes will be
planted in Virginia as soon as the ground thaws and dries out sufficiently. Pastures are greening up well, and
farm animals have passed through the winter in better condition on the average than is usually the case, due to
the open winter and abundance of feed. Farmers are buying mules, wagons, farm machinery and fertilizer in
much larger volume than they did last year, and are making preparations in every way for an energetic,
aggressive campaign to make 1923 a profitable year.
BUILDING OPERATIONS FOR THE MONTHS*OF FEBRUARY, 1923 AND 1922.
Permits Issued
New Construction
CITIES

0

New
1923 1922

2

MR L N
AYA D
1 Baltimore............
2 Cumberland........
3 Frederick.............
V G IA
IR IN
4 Lynchburg...........
5 Norfolk................
6 Richmond............
7 Roanoke...............
W S V G IA
E T IR IN
8 Bluefield..............
9 Charleston...........
10 Clarksburg...........
11 Huntington..........
12 Parkersburg........
N R HC R L A
O T A O IN
13 Asheville..............
14 Charlotte..............
15 Durham...............
16 Greensboro..........
17 High Point..........
18 Wilmington..........
19 Winston-Salem
S U HC R L A
O T A O IN
20 Charleston...........
21 Columbia.............
22 Greenville............
23 Spartanburg........
D T O C L MIA
IS . F O U B
24 Washington.........

Alterations

Repairs
1923

1922

317
15
3

283
11
0

554
12
2

13
90
112
78

11
27
87
46

16
43
50
46

10
29
65

9
82
16
77

23
31
18
90

3
14
10
10

47
53
15
23
29
7
46

43
27
13
13
8
14
34

15
56
23
25
304

1922

1923

694 $ 3,759,360 $ 1,725,720
15
41,815
28,265
3
23,400
0

1923

$ 289,716
25,385
7,000

1922

Cent
Increase or Perof
Decrease Increase
Total
or
Valuation Decrease
2

$ 463,200 $ 1,860,156
24,835
14,100
6,100
24,300

23,615
302,980
1,037,420
263,595

26,125
79,550
632,812
84,195

15,950
44,824
173,609
14,090

2,925
14,190
1,652,130
8,345

1
42
12
14

21,500
205,795
18,625
171,715
100,000

55,705
75,437
44,410
150,140
25,000

875
27,950
6,675
7,005
25,000

600
14,848
55,765
5,450
15,000

18
6
6
11
5
4
44

12
14
6
11
5
1
40

288,538
401,000
29,550
204,427
47,155
52,000
548,800

285,056
70,995
22,760
25,655
24,150
49,500
370,405

8,493
10,600
21,950
18,882
4,800
19,000
28,875

3,022
23,000
10,100
3,505
4,446
10,000
8,390

17
43
21
19

17
53
14
21

20
75
18
30

44,450
56,305
77,300
21,830

108,870
56,525
74,480
12,110

24,030
7,817
5,750
12,590

7,455
16,308
10,565
14,205

167

336

242

4,524,025

1,404,392

502,855

162,587

Totals........ 1,455 1,046 1,295 1,390 $12,265,200

$5,432,257

$1,303,721

31

85.0% 1
26.6
2
398.4
3

10,515
36.2
254,064 271.0
—1,073,913 — 47.0
185,145 200.1
—

33,930 — 60.3
143,460 158.9
— 74,875 — 74.7
23,130
14.9
85,000 212.5
8,953
317,605
18,640
194,149
23,359
11,500
198,880
—
—
—

4
5
6
7
8
9
10
11
12

3.1
337.9
56.7
665.8
81.7
19.3
52.5

13
14
15
16
17
18
19

47,845 — 41.1
8,711 — 12.0
1,995 — 2.3
8,105
30.8

20
21
22
23

3,459,901

$2,536,971 $ 5,599,693

220.8

24

70.3%

—Denotes Decrease.

There were no signs of recession in the building boom during February, permits for new construction is­
sued in twenty-four of the leading cities in the Fifth District breaking previous records for the corresponding




7

month of the year. The twenty-four cities issued a total of 1,455 permits for new work in February, with
estimated valuations of $12,265,200, compared with 1,046 permits for new work issued in February 1922, with
estimated valuations of $ 5,432>
257- The number of permits issued does not cover all of the building activi­
ties in the reporting cities, because there is a great deal of building being done in the suburbs near all of the
cities, these dwellings not being covered by permits issued by city authorities. The general use of automobiles
and the establishment of jitney and bus lines is spreading the residence section of our cities.
As a result of the continued activity in construction work, dealers in all kinds of builders’ materials are
enjoying good business, and are receiving all the orders they can take care of. Prices of building materials
are gradually working higher in practically all lines, and wages of workmen are tending to advance, also.
Labor for certain phases of construction work is scarce, especiaily for plasterers, masons, etc., and naturally
their wages have advanced more than the wages of the men not quite so much in demand.
FIGURES ON RETAIL TRADE
As Indicated By Reports from Twenty-eight Representative Department Stores
for the Month of February, 1923.
Baltimore

Richmond

Washington

Other
Cities

District

Percentage increase in net sales during
Feb., 1923, compared with February, 1922....

7.1

15.7

— 1.2

10.8

4.8

Percentage increase in net sales from
January 1, through February 28, compared
with sales during the same two months
of 1922...........................................................

11.1

22.4

1.7

13.2

8.5

Percentage increase in net sales during
February, 1923, over sales in Jan., 1923........

— 14.2

— 11.5

1.3

— 9.5

— 7.8

Percentage increase in stocks on hand at
the end of February, 1923, over stocks on
hand at the end of February, 1922..............

9.2

9.6

6.1

7.1

7.7

Percentage increase in stocks on hand at
the end of February, 1923, over stocks on
hand at the end of January, 1923...............

13.0

18.7

10.0

11.9

12.2

Percentage of average stocks on hand at
the end of each month since Jan. 1,
to average net sales each month during
the same period, two months....................

437.9

413.0

471.0

595.0

466.7

Percentage of outstanding orders at the end
of February, 1923, to total purchases of
merchandise during the year 1922...............

9.8

10.1

7.8

10.7

9.0

—Denotes decrease.

February is normally a comparatively slow month in retail trade and merchants do not generally expect
to do a large volume of business. However, figures received this month from twenty-eight department and
general stores, located in fourteen of the leading cities of the Fifth District, show that sales during February
declined very little under January sales, the decrease being 7.8%. In comparison with February 1922, Feb­
ruary of this year shows a gain in sales of 4.8%, with the stores in Richmond leading with an average gain
of 15.7% . The Baltimore stores gained 7.1% and the group of Miscellaneous Cities gained 10.8% , but
the reporting stores in Washington lost 1.2% in comparison with the same month a year ago. All of the
groups for which averages are calculated show increased cumulative sales since January 1st in compari­
son with cumulative sales during the same two months of 1922.
In stocks carried, the reporting stores show an increase of 7.7% over stocks on hand February 28, 1922,
and a gain of 12.2% over stocks reported at the end of January of this year, the latter increase being of
course entirely seasonal, and due to the receipt of spring merchandise. The percentage of average stock on
hand at the end of each month since January 1, 1923, to average monthly sales during the same two months,
was 466.7% for the District, the Richmond stores showing the most rapid turn-over with an average of
413.0% and the group of Miscellaneous Cities the slowest turn-over with an average of 595.0%. Orders out­
standing for merchandise at the end of February amounted to 9.0% of the total purchases during the cal­
endar year 1922




.

8

Last month we stated in our Review that twenty-seven stores had reported to us, but the number should
have been twenty-eight. Monthly averages through 1922 were made up from twenty-five reports, but we
included three new stores in the January figures, these stores being located in Baltimore, Washington and
Charleston, S. C. We regret the misstatement as to the number of firms included, but the actual figures
were not affected.
WHOLESALE TRADE
Percentage Increase (or Decrease) in Net Sales During Feb., 1923, as Compared With Jan., 1923
and February, 1922.
Groceries
Number of reporting firms in each line______

Dry Goods

42

Shoes

15

21

Hardware

Furniture

16

Drugs
14

Net sales (selling price) during Feb., 1923,
compared with January, 1923.......................

4.3

— 9.0

20.2

—15.6

—12.9

—17.7

Net sales (selling price) during Feb., 1923,
compared with February, 1922....................

11.8

53.1

20.4

46.5

63.5

13.9

—Denotes Decrease.

The accompanying table shows in percentage form the increase or decrease in the dollar amount of sales
made in February 1923 by representative firms dealing in groceries, dry goods, shoes, hardware, furniture and
drugs, in comparison with (1) sales made in January 1923, and (2) sales made in February 1922. All lines
reported upon show decreased sales in February in comparison with January, both this year, except shoes, which
shows a 20.2% gain. In comparison with February 1922 sales, February 1923 shows substantial gains in
every line reported upon, the increases in dry goods, hardware and furniture being especially notable. The
large increases in hardware and furniture reflect the influence of the building boom mentioned elswhere in this
Review, and doubtless the sharp increase in dry goods sales over last year is influenced by a fear of difficulty
in securing goods later in the year as a consequence of the short cotton crop of 1922. Price increases also
swelled the February 1923 figures in dry goods, but to nothing like the extent shown by the percentage gain
in sales.
Collections were reported as being somewhat slower in February than in the month or two immediately
preceding, but this is a natural or usual condition in that month. Merchants have paid out their holiday col­
lections during January, and January sales being as a rule comparatively small, funds are not available until
Spring trade opens in larger volume than it does in February. In addition, merchants having to pay large
income taxes on or before March 15th are forced to hoard their funds for a month or two previous to that
date. The slump in collections was not serious, the percentage of reporting firms that classified their collec­
tions as either Good or Fair being 90.6% in comparison with 92.5 % so classified in January 1923. We give
below the classifications of collections made by 117 reporting firms for February, and for comparative pur­
poses we have added the total reported for January 1923 and February 1922:
Lines

Good
9

5
1
3
0
7

Shoes
Drugs

25

January 1923




29
9

Collections Reported As
Fair
Slow
Poor
29
1
3
1
0
9
2
1
17
10
0
3
0
0
9
0
0
7
81
2
9
81
0
9
57
43
7

(Compiled March 21, 1923)
9

T otal
42
15
21
16
9
14
117
119
116

Summary of Business Conditions in the United States.
Continued active business is indicated by the maintenance of a high rate of industrial production, in­
creases in freight traffic and employment, and a large volume of retail and wholesale trade.
PRODUCTION
The Federal Reserve Board’s Index of Production in Basic Industries for February was at the same high
level as in January. The index number for these industries in now approximately equal to the highest point
reached in the past. Since the low point in July 1921, there has been an increase of 61 percent. The vol­
ume of new building projected in February was exceptionally large for the season, particularly in Western
districts. Railroad freight shipments have been increasing and the car shortage, which was somewhat re­
lieved in December and January, became more marked in recent weeks. A continued increase in industrial
employment has been accompanied by further advances in wage rates in a number of industries. Many New
England woolen mills announced a wage increase of 1 2 ^ percent effective April 30th. A shortage of women
workers has been reported in the textile, rubber and garment industries, and there is a shortage of unskilled
labor in many industrial centers.
TRADE
Wholesale and retail distribution of goods continued at a high level during February. Sales of both
wholesale and retail concerns reporting to the Federal Reserve Banks were well above those of a year ago,
but the increase was relatively more pronounced in wholesale trade. Mail order and chain store business was
almost as large in February as in January despite the shorter month, and sales of 5 and 10 Cent Stores
were actually larger than in January.
WHOLESALE PRICES
The Bureau of Labor Statistics Index of Wholesale Prices advanced slightly during February. Prices
of metals, building materials and clothing increased, while prices of fuels and farm products declined. Build­
ing materials and metals during the past year have advanced more than any other groups of commodities and
are now about 25 percent higher than in March 1922.
BANK CREDIT
Recent increases in industrial and commercial activity have been reflected in a larger volume of loans by
member banks for commercial purposes, especially in the New York, Chicago and San Francisco districts.
Loans of this character by reporting member banks are now approximately 500 million dollars larger than at
the end of December. This increase has been accompanied by a reduction in holdings of investments so that
there has been only a moderate net increase in total loans and investments. The larger demand for funds
has not led to any increase during the past month in the total volume of credit extended by the Reserve banks.
Total earning assets and loans to member banks on March 21st were approximately the same as four weeks
earlier. Borrowings by member banks in the interior increased, particularly in the Chicago district, but bor­
rowings by member banks in the New York district decreased. Since the end of February, there has been a
small decline in the volume of Federal Reserve note circulation which is now at approximately the same level
as six months ago. Other forms of currency in circulation, however, have recently increased. The market
rates on commercial paper advanced further to a range of 5 to 5 percent and the rate on bankers’ accep­
tances remained steady at about 4 percent. There has been a slight increase in the yield of short term
Treasury Certificates as well as of Government and other high grade bonds.




10




11




12

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