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

BUSINESS AND AGRICULTURAL CONDITIONS

W ILLIAM W. HO XTO N, CHAIRMAN AND FEDERAL R ESER VE AGENT

RICHMOND, VIRGINIA
Seasonal dullness marked February business in the
Fifth reserve district, and in some lines the recessions
from recent activity were greater than can be ex­
plained by seasonal trends alone. Rediscounts held by
the Richmond reserve bank declined between the mid­
dle of February and the middle of March, an unseasonal
development at a time when increased demands for
agricultural loans usually cause a rise in borrowing by
banks in rural sections. City member banks slightly
increased their borrowing at the reserve bank to
counteract deposit withdrawals by correspondent banks
in agriculutral sections and by merchants for use in
discounting bills for spring merchandise. Debits to
individual accounts figures for four weeks ended March
9th were 6.2 per cent below total debits during the pre­
ceding four weeks ended February 9th, and were also
9.9 per cent below aggregate debits for the correspond­
ing period ended March 10, 1926. Business failures
were more numerous and total liabilities involved were
greater in the Fifth District in February than in any
other February since 1922. Unemployment spread con­
siderably between the middle of February and the mid­
dle of March, and in some localities reached rather
serious proportions. Construction work provided for
in permits issued in February was less than that pro­
vided for in February 1926 permits, and for the fifth
consecutive month, total valuation figures for permits
issued fell below the figures for the same month of
the preceding year.
The outlook in the textile field improved during Feb­
ruary and early March, and practically all Fifth Dis­
trict mills are running full time, with a larger volume
of forward orders on the books than they have had in
many months. Increased domestic cotton consumption
and higher exports of cotton in comparison with the
same period in 1926 caused spot cotton prices to rise
slightly during the past two months, and this firmness
in raw material prices had a beneficial effect upon the
textile industry. Retail trade in February was mod­
erate only, but was probably up to seasonal average for
years in which Easter occurs as late as it does this
year. Present indications suggest a favorable agri­
cultural season, but it is too early to put much de­
pendence upon crop prospects.
SAVING DEPOSITS — Deposits in thirteen mutual
savings banks in Baltimore increased last month, rising
from a total of $161,231,987 at the end of January
to $161,981,216 at the end of February. On February
28, 1926, the same reporting banks had aggregate de­
posits of $152,665,800, indicating an increase during
the past year of slightly more than 6 per cent. On the
other hand, time deposits in sixty-seven reporting
member banks in the Fifth District declined last month,
dropping from $219,122,000 on February 9th to $214,489,000 on March 9th. Time deposit figures in com­
mercial banks do not represent as large a percentage
of actual savings as mutual saving bank deposits,
however, the commercial bank deposits containing a
considerable volume of temporarily idle funds in ex­
pectation of withdrawal for commercial use.



MARCH 31, 1927
RESERVE BANK OPERATIONS — Rediscounts
for member banks at the Federal Reserve Bank of
Richmond declined from $23,658,000 on February 15th
to $20,313,000 on March 15th, both this year, a move­
ment contrary to seasonal experience. In most years
discounts increase in the Fifth District between the
middle of February and the middle of March, due to
agricultural demands incident to fertilizer purchases
and other expenses incurred in connection with crop
planting. This year all reports indicate a marked fall
in fertilizer tonnage purchased by the farmers of the
District, and this probably accounts for the unusual
reduction in the volume of rediscounts. Total bill
holdings of the Federal Reserve Bank of Richmond
declined during the month under review from $33,840.000 to $30,015,000, the decrease being partly due
to a reduction of approximately $500,000 in the hold­
ings of ban k ed acceptances purchased from member
banks and in the open market. The actual circulation
of Federal Reserve notes dropped from $74,493,000 on
February 15th to $72,542,000 on March 15th, a seasonal
decline, and member bank reserve deposits registered
only a daily fluctuation during the four weeks, falling
from $69,175,000 to $68,920,000 between February 15th
and March 15th. The several changes mentioned did
not materially affect the Bank’s cash reserves, which
rose from $110,956,000 at the middle of February to
$111,173,000 at the middle of March. The ratio of
cash reserves to note and deposit liabilities combined
rose a little over 3 points during the month, from
74.89 per cent on February 15th to 77.99 per cent on
March 15th.

Between March 15, 1926, and March 15, 1927, the
volume of rediscounts held by the Federal Reserve Bank
of Richmond dropped approximately 56 per cent, de­
clining from $46,575,000 a year ago to $20,313,000 on
the 1927 date. Total bill holdings of the Richmond
bank also declined, falling from $57,040,000 to $30,015.000 during the year. The volume of Federal Re­
serve notes in actual circulation stood at $78,508,000
on March 15th last year, but dropped to $72,542,000 on
March 15, 1927. Member bank reserve deposits rose
during the year from $67,046,000 to $68,920,000. The
lessened demand for Reserve bank credit this year re­
sulted in increased cash reserves of the Federal Reserve
Bank of Richmond from $92,570,000 on March 15, 1926,
to $111,173,000 on March 15th this year, and the ratio
of cash reserves to note and deposit liabilities combined
rose from 63.34 per cent to 77.99 per cent during the
same period.

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

March 9, 1927

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

February 9, 1927

March 10, 1926

$ 516,929,000

$ 520,674,000

$ 520,883,000

140.599.000

137.618.000

126.981.000

41.847.000
13.839.000
379.938.000
214.489.000
10.844.000

39.374.000
13.686.000
384.988.000
219.122.000
9,748,000

41.423.000
13.969.000
370.718.000
206.604.000
22.101.000

F ig u re s in the above table show the principal item s of condition reported by sixty-seven identi­
cal m em ber banks on three dates, M arch 9, 1927, F e b ru a ry 9, 1927, and M arch 10, 1926, thus affordin g
data for a com parison of the latest available figures w ith those of the preceding month this y e a r
and the corresponding month last y ear. The figures are from all m em ber banks in thirteen leading
cities of the F ifth R eserv e D istrict.
C om paring the changes in the item s betw een F e b ru a ry 9th and M arch 9th, both this y e a r, total
loans and discounts show a decrease of $3,745,000 during the four w eeks. T he rep ortin g banks in­
creased their investm ents in bond and securities b y $2,981,000 betw een F e b ru a ry 9th and M arch 9th,
and added $2,473,000 to their reserve deposits at the Fed eral reserve bank. Cash in vau lt changed
little during the month, risin g by $153,000. D eposits declined m aterially, p robably due chiefly to
w ith d raw als by correspondent banks in agricu ltu ral sections and to discounting b y city m erchants
of bills fo r spring m erchandise. Dem and deposits declined $5,050,000 and tim e deposits dropped
$4*633,000 during the period under review . T h e several changes in the principal item s necessitated
an increase in rediscounts at the reserve bank, w hich rose $1,096,000 during the month.
T o tal loans and discounts for custom ers reported by the sixty-seven m em ber banks w as $3,954,000
less on M arch 9th this y e a r than on M arch 10th a y e a r ago, w hile investm ents of the rep ortin g banks
in bonds and securities rose $13,618,000 during the year. A g g re g a te reserve balances of the rep o rt­
ing institutions at the F ed eral reserve bank rose $424,000, w hile cash in vau lt decreased $130,000, both
daily fluctuations m erely. Dem and deposits rose $9,220,000 during the y e a r under review , and tim e
deposits increased by $7,885,000. In creased deposits, w ith a decline in the demand fo r credit b y
custom ers, enabled the rep ortin g banks to reduce the volum e of b o rrow in g at the reserve bank by
$11,257,0 0 0 betw een M arch 10, 1926, and M arch 9, 1927, a reduction of ap p roxim ately 51 per cent.

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

March 9, 1927

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

$

34,103,000
365,490,000
27,141,000
32,359,000
47,686,000
20,783,000
7,826,000
8,906,000
24,412,000
22,770,000
20,801,000
9,409,000
22,566,000
17,669,000
9,453,000
67,856,000
19,237,000
119,744,000
25,654,000
11,713,000
211,068,000
17,567,000
34,091,000

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

$ 1,178,304,000

February 9, 1927
$

30,765,000
383,971,000
24.921.000
36.300.000
46.624.000
18.286.000
7.799.000
12,668,000
23.618.000
23.230.000
21.135.000
9.849.000
23.749.000
18.719.000
9.854.000
72.889.000
32.405.000
136,848,000
26,846,000
13,867,000
224,046,000
18,360,000
39,147,000

$ 1,255,896,000

March 10. 1926
$

29,044,000
409,612,000
25.570.000
37.209.000
46.439.000
16.244.000
7.956.000
10.068.000
27.332.000
25.597.000
24.609.000
9.507.000
24.391.000
20.862.000
10.109.000
74.179.000
45.671.000
141,094,000
26,709,000
14,248,000
221,032,000
21,317,000
38,515,000

$ 1,307,314,000

The accom panying table show s total debits to individual, firm and corporation accounts at clear­
ing house banks in tw en ty-th ree o f the leading cities of the F ifth Fed eral reserve district during three




2

periods of four w eeks each, ended M arch 9, 1927, F eb ru ary 9, 1927, and M arch 10, 1926. Debits figures
include all checks draw n again st depositors’ accounts, and th erefore form one of the best barom eters
of business activity.
The total of debits during the four w eeks ended M arch 9, 1927, am ounted to $1,178,304,000, com ­
pared w ith $1,255,896,000 during the preceding four w eeks ended F e b ru a ry 9th, a decline during the
m ore recent period of $77,592,000, or 6.2 per cent. Seventeen of the tw en ty-th ree cities reported low er
figures for the period ended M arch 9th, w hile increased figures w ere reported by A sh eville, C h arles­
ton, S. C., Charlotte, Columbia, Cum berland and Durham . The four larg e st cities, Baltim ore, W ash ­
ington, Richm ond and N orfolk, showed declines.
In com parison w ith the four w e e k s’ period ended M arch 10, 1926, in which total debits in the re ­
porting cities am ounted to $1,307,314,000, the corresponding period this y e a r w itnessed a recession
to $1,178,304,000, a decline of $129,010,000, or 9.9 per cent, a considerable part of which w as prob­
ably due to decreased ac tiv ity in construction w o rk this y ear in m ost of the reportin g cities. A low er
price level this y e a r also reduced the am ount of debits to some extent. T he decline w as quite ge n ­
eral throughout the F ifth R eserv e D istrict, only four cities— A sheville, Charleston, S. C., Charlotte and
Colum bia— attain ing higher figures during the 1927 period than in the corresponding four w eeks a
y ear earlier.

BUSINESS FAILURES— In com m enting on the business m ortality record for F e b ru a ry 1927,
D un’s R ev iew for M arch 5th says, “ A seasonal decline in the number of failures in the U nited S tates
in variab ly begins in F eb ru ary , and the total reported for last month w as 2,035. Th is is 17.4 per cent
below the 2,465 com m ercial defaults of Ja n u a ry , but a part of this substantial decrease is accounted
for by the fact that F e b ru a ry is the shortest month of a year, and is made still shorter by holidays.
C om paring w ith the 1,801 insolvencies of F eb ru ary 1926, an increase of 13.0 per cent appears, although
in this connection some allow ance should be made for the larg e r number of firms and individuals now
engaged in business. L ik e the num ber of failures, last month’s liabilities of $46,940,716 show a
fallin g off from the $51,290,232 of Ja n u a ry , the reduction being 8.5 per cent. On the other hand, the
am ount for F e b ru a ry exceeds by 37.4 per cent the $34,176,348 of the corresponding month of 1926.
T h ere w ere m ore large defaults last month than a y ear ago, those for $100,000 or m ore of indebted­
ness in each case num bering 54, again st 44 in the earlier year, and the liabilities of last m onth’s large
insolvencies approxim ate $25,200,000, as com pared w ith only about $13,500,000 for such failures in
F e b ru a ry 1926. The defaults of unusual size supply 53.7 per cent of last m onth’s a g g re g a te indebted­
ness, w hile in F eb ru ary last y ear the large insolvencies provided 39.6 per cent of the total liabilities
of all failu res.”
In the F ifth D istrict, F e b ru a ry failures numbered 156, com pared w ith 170 in Ja n u a ry this y ear
and 11 8 in F eb ru ary 1926, w hile F eb ru ary 1927 liabilities of $4,248,597 exceeded the $3,533,544 of Ja n u ­
a ry 1927 and the $1,845,307 of F eb ru a ry last year. Both the number of failures and the total of lia­
bilities involved exceeded those of any F eb ru ary since 1922, and liabilities w ere the highest for any
month since M ay 1925.
LABOR— U nem ploym ent has spread furth er since the middle of F eb ru ary , and in some of the
larger cities an unusual num ber of w o rk ers are idle.
The volum e of construction w o rk under
w a y is sm aller than at this time in 1926, and this fact together w ith increased efficiency of w orkm en
who are em ployed has reduced the demand for both skilled and unskilled labor in all lines either
d irectly or indirectly connected w ith building. There is a m arked surplus of clerical w o rk ers in all
the cities, and the supply of dom estic servan ts is considerably gre ater than the demand. F arm labor
is som ew hat m ore abundant than in recent years, as is nearly alw ays the case when lack of em ploy­
m ent in the cities drives some unskilled laborers back to the rural districts. F a c to ry em ployees are
b etter em ployed than other groups, especially in textile and tobacco industries, although during the
latter part of F e b ru a ry and ea rly M arch a few cotton mills operated on a short tim e schedule. The
threat of trou b le in union coal m ining regions has kept the demand for bitum inous coal at an un­
usu ally high level for this season, and W est V irgin ia m iners have th erefore continued to have steady
em ploym ent, in spite of the settlem ent of the B ritish coal strike. On the w hole the w eath er in
the F ifth D istrict has been favorable for outside w ork since the middle of F eb ru ary, and laborers w ith
jobs w ere able to put in reg u lar hours.
COAL— The total production of bitum inous coal during the month of F e b ru a ry is estim ated by
the Bu reau of M ines, D epartm ent of Comm erce, at 52,904,000 net tons, and total production during
the present coal y ear to M arch 12th — approxim ately 292 w orkin g d ays— am ounts to 566,474,000
tons, the highest output of any recent year. D aily production in F e b ru a ry w as about 1.5 per cent
under that of Ja n u a ry , a seasonal decline, but the decrease w as som ew hat less m arked than norm ally
occurs at this season, probably due to the building up of reserve stocks of coal again st possible trouble
in the unionized fields afte r the expiration of present w orkin g agreem ents betw een mine ow ners and
m iners. R eta il yard s have larg e stocks on hand, and m any industrial plants have accum ulated re ­
serve piles of fuel sufficient to run them from six ty to ninety days. R eta il prices have dropped
slig h tly in m any y ir d s during the past month as the demand from consum ers lessened w ith the ap­
proach of m oderate w eather.




3

TEXTILES— Th e concensus of opinion indicates some im provem ent in outlook in the textile
field during the past month. A larg e volum e o f goods is m oving into trade channels, and w hile m ost
of it m oves on short orders, the m ills have m ore future d elivery business booked than they have p re­
viou sly had in recent months. Spot cotton prices did not fluctuate w idely betw een the middle of
F eb ru a ry and the middle of M arch, and the m ills w ere able to hold their quotations firm. In some
cases jobbers and retailers who postponed orders have been obliged to p ay prem ium s for im m ediate
or short tim e d elivery of u rg en tly needed goods. A few m ills operated on reduced schedule during
part of F e b ru a ry and into M arch, due to an accum ulation of m anufactured goods in their w arehouses,
but these goods have p ractically all been m oved and the m ills have resum ed full tim e operations.
F ifth D istrict m ills consumed 249,638 bales of lint cotton in F eb ru ary , of which N orth Carolina m ills
used 137,094 bales, South Carolina m ills 101,595 bales, and V irg in ia m ills 10,949 bales. The F e b ru a ry
figures com pare w ith 255,398 bales consumed during the longer month of Ja n u a ry this y ear and 233,236
bales used in F e b ru a ry 1926. Consum ption in the F ifth D istrict in F eb ru a ry totaled 42.6 per cent of
N ational consum ption, com pared w ith 4 1.1 per cent in 1926 and 39.9 per cent in 1925.
BUILDING OPERATIONS FOR THE MONTHS OF FEBRUARY 1927 AND 1926.
Permits Issued
CITIES
2
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29

New

Repairs

1927 1926
327
Baltimore, Md.
15
Cumberland, Md...
6
Frederick, Md.
18
Hagerstown, Md...
12
Danville Va.........
38
Lynchburg, Va....
61
Norfolk, Va..........
6
Petersburg, Va.....
101
Richmond, Va.
88
Roanoke, Va.
7
Bluefield, W. Va...
76
Charleston, W. Va.
12
Clarksburg, W. Va
Huntington, W.Va.
37
12
Parkersburg,W.Va
28
Asheville, N. C.....
46
Charlotte, N. C....
40
Durham, N. C.
55
Greensboro, N. C.
55
High Point, N. C...
23
Raleigh, N. C.......
15
Salisbury, N. C....
Wilmington, N. C.
7
85
W
inston-Salem, N. C.
18
Charleston, S. C ...
18
Columbia, S. C.....
11
Greenville, S. C.
21
Spartanburg, S. C.
Washington, D. C. 233

New Construction

274
18
2
9
12
19
93
6
112
82
7
39
7
74
15
91
45
35
45
59
50
16
7
83
11
13
8
12
124

1927
886
3
3
5
21
27
69
6
62
34
8
14
10
1
7
42
17
14
20
5
11
2
5
24
18
35
30
16
252

1926

1927

1926

816 $ 2,191,200 $ 1,616,160
1
75,390
33,495
0
27,330
7,700
9
30,530
55,995
11
60,225
462,885
26
96,101
79,729
36
181,275
210,350
7
9,430
17,504
63
454,625
1,486,764
21
241,532
198,941
3
20,700
23,090
10
156,738
133,481
6
9,275
18,730
4
193,420
219,635
3
21,550
44,850
26
151,105
839,475
14
263,234
221,440
11
179,725
243,510
29
300,556
995,750
6
158,300
154,600
7
80,125
148,264
5
60,145
52,700
7
11,350
195,500
32
540,350
224,300
23
32,860
17,635
39
133,500
38,440
22
158,800
39,800
23
14,610
70,275
230 3,645,925
3,232,765

Totals......... 1,471 1,368 1,647 1,490 $ 9,499,906 $11,083,763

Alterations
1927
$ 462,360 $
1,375
1,500
3,325
5,862
29,655
46,796
2,935
82,896
11,200
48,300
95,750
8.085
500
10,750
22,430
314,675
11,520
9,570
4,800
3,950
675
9,800
23,475
5,405
6,230
16,730
3,285
242,820
$1,486,654

1926

Increase or Per Cent
Decrease
of
of
Increase 0
Total
or
2
Valuation Decrease

688,384 $
349,016
415
42,855
0
21,130
—
3,610
25,750
9,115 — 405,913
23,499
22,528
31,439 —
13,718
13,080 —
18,219
48,155 — 997,398
49,076
4,715
1,300
44,610
5,950
113,057
1,750 —
3,120
6,500 —
32,215
2,350 — • 14,900
43,835 — 709,775
17,385
339,084
31,275 — 83,540
— 706,176
20,552
12,050 —
3,550
28,050 — 92,239
6,700
1,420
5,800 — 180,150
15,306
324,219
7,867
12,763
7,920
93,370
12,350
123,380
— 56,245
3,865
324,340
331,640

15.1%
126.4
274.4
— 43.2
— 86.0
21.8
— 5.7
— 59.6
— 65.0
24.1
182.9
81.1
— 15.2
— 14.2
— 31.6
— 80.4
142.0
— 30.4
— 69.5
— 2.1
— 52.3
2.4
— 89.5
135.3
50.0
201.4
236.6
— 75.9
9.3

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

$1,377,557 —$1,474,760 — 11.8%

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

Construction w o rk provided fo r in perm its issued in F eb ru a ry by building inspectors in tw en tynine leading centers of the F ifth R e se rv e D istrict exceeded the volum e of w o rk provided for in p er­
m its issued in F e b ru a ry 1926 in the num ber of p rojects, but fell below last y e a r ’s figures in total esti-*
m ated valuation fo r the w ork. P erm its fo r new w o rk issued in the 29 cities in F e b ru a ry num bered
1,4 7 1, w ith estim ated valuation of $9,499,906, com pared w ith 1,368 perm its estim ated to cost $11,0 8 3,76 3
issued in the sam e cities in F e b ru a ry 1926. Sixteen cities show increases this y e a r in the num ber of
perm its and 14 report higher valuation figures. In creases in valuation figures of m ore than 100 per
cent w ere reported by Cum berland, F red erick, Bluefield, Charlotte, W inston-Salem , Colum bia and
G reenville. A m o n g the four larg e st cities of the D istrict, B altim ore and W ashington reported higher
figu res fo r F e b ru a ry this year, w hile N orfolk and Richm ond reported low er totals. In alteration
and repair w ork, 1,647 perm its issued in F e b ru a ry 1927 com pare w ith 1,490 perm its issued in F e b ru a ry
last year. V aluation figures for alteration and repair w o rk in F e b ru a ry this y ear to talin g $1,486,654
also exceeded $1,377,557 reported by the sam e cities for the corresponding month in 1926. Combined
valuation figures fo r all classes of w o rk totaled $10,986,560 in F e b ru a ry 1927 and $12,4 6 1,320 in F e b ­
ru a ry 1926, a decline this y e a r o f $1,474,760, or 11.8 per cent.
C ontracts actu ally aw arded during F e b ru a ry fo r construction w o rk in the F ifth D istrict totaled




4

$ 24 , 943 > 43 > ° f w hich $9,552,638 w as fo r residential w ork, according to statistics collected by the F . W .
6
Dodge Corporation. T h ese figu res include suburban and rural construction in addition to the city
w o rk covered by building perm it figures.

COTTON— Spot cotton prices continued to advance slo w ly during the month betw een F e b ru a ry
12th and M arch 12th, m aking a net gain of approxim ately half a cent a pound, according to figures
released by the Cotton Q uotation S ervice of the D epartm ent of A gricu ltu re. The av erage price paid
g ro w e rs in the Carolinas fo r m iddling grade upland short staple cotton during the w eek ended F e b ­
ru a ry 12th w as 13 .16 cents per pound, and the av erage price paid during the w eek ended M arch 12th
w as 13.67 cents. Since the w eek ended Decem ber 1 1 , 1926, when the ave rag e price w as 1 1 . 1 7 cents per
pound, the price has advanced 2.50 cents, or approxim ately $12.50 per bale, but at present the quota­
tions are 4. cents, or $20 a bale, under the .figures quoted at the middle of M arch last year.
The Census B u rea u ’s cotton consum ption report for F eb ru ary , issued on M arch 14, showed 590,447
bales used during the month, com pared w ith 604,584 bales consumed during the lon ger month of
Ja n u a r y and 5 6 5 118 bales used in F e b ru a ry last year. T o tal consum ption fo r the seven m onths of
the present season— A u gu st 1s t to F eb ru ary 28th— am ounted to 4,024,487 bales, com pared w ith 3,745,552
bales consumed in the corresponding period ended F e b ru a ry 28, 1926. Cotton g ro w in g states used
425,442 bales in F e b ru a ry 1927, again st 437,778 bales in Ja n u a ry this y e a r and 396,640 bales in F e b ru ­
a ry a y ear ago. M an u factu rin g establishm ents held 1,933,077 bales on F e b ru a ry 28th, com pared w ith
1,852,987 bales on Ja n u a r y 3 1 s t and 1,832,655 bales on F e b ru a ry 28, 1926. P ublic w arehouses and com ­
presses held 5,433,820 bales in sto rage at the end of F eb ru a ry this y ear, com pared w ith 6,070,020
bales so held a month earlier and 4,740,450 bales on F e b ru a ry 28th last year. F e b ru a ry exports totaled
1,010,507 bales, a figure slig h tly below the total of 1,115 ,7 9 2 bales sent abroad during the lon ger month
of Ja n u a ry but n early double the 556,185 bales exported in F eb ru a ry 1926. E x p o rts during the seven
months of this cotton y e a r totaled 7,699,553 bales, com pared w ith 5,986,630 bales shipped over seas dur­
ing the corresponding seven months ended F e b ru a ry 28, 1926. Spindles active m F e b ru a ry numbered
32,872,102, com pared w ith 32,633,550 in Ja n u a ry this y e a r and 33,009,138 in F eb ru a ry last year.
TOBACCO— V IR G IN IA tobacco m arkets sold 27,787,995 pounds of producers’ tobacco in F e b ru ­
ary, at an average price of $10.56 per hundred pounds. T o tal sales this season to M arch 1s t reached
138,200,860 pounds, which is ap p roxim ately 98.5 per cent of the estim ated sales for the year. S everal
m arkets closed during F e b ru a ry and the rem ainder, excepting a few Fire-cu red houses, w ill close by
the middle of M arch. Flue-cured, or B rig h t, tobacco sales for F e b ru a ry totaled 9,703,471 pounds,
com pared w ith 8,120,921 pounds sold during the corresponding month last year, w hile Fire-cured, or
D ark, tobacco sales totaled 15,052,196 pounds, the larg e st am ount ever sold during a single month and
n early four tim es the 3,977,595 pounds of this type sold in F e b ru a ry 1926. Sun-cured sales on the
Richm ond m arket totaled 2,485,051 pounds, com pared w ith 631,500 pounds sold in the sam e month
last year. The average price of Flue-cured fo r the month w as $15.9 6 per hundred pounds, com pared
w ith $10.96 in F e b ru a ry 1926. Fire-cu red tobacco averaged $7.18, com pared w ith $ 11.7 8 in F eb ru a ry
last year. The av e rag e fo r Sun-cured w as $9.58 in F e b ru a ry 1927 and $15.9 0 in F e b ru a ry 1926. The
quality of tobacco sold last month w as com paratively poor, grades running 15 per cent good, 30 per
cent medium, and 55 per cent common. D anville led all m arkets w ith sales a g g re g a tin g 4,790,431
pounds of Flue-cured, L yn c h b u rg ran kin g second w ith sales of 3,482,272 pounds of Fire-cured. In
season sales, D anville leads w ith 44,003,368 pounds, South Boston ran kin g second w ith 18,178,949
pounds. L yn c h b u rg leads the F ire-cu red m arkets for the season w ith sales o f 8,949,997 pounds prior
to M arch 1st.
N O R T H C A R O L IN A auction m arkets sold only 8,136,678 pounds of tobacco fo r gro w e rs in F e b ­
ru ary, com pared w ith 12,702,929 pounds sold during the corresponding month last year, but total sales
fo r the season to M arch 1s t reached 370,233,624 pounds this y ear com pared w ith 343,858,832 pounds
sold prior to the sam e date a y e a r ago. The average price paid in F e b ru a ry this y e a r w as $ 15 .9 1 per
hundred pounds, com pared w ith $ 13 .5 1 per hundred in F eb ru a ry 1926. In total sales in F eb ru ary , W in ­
ston-Salem led w ith 3 ,17 1,3 8 3 pounds, O xford and Durham ran kin g second and third w ith sales to ta l­
ing 1,085,779 pounds and 1,038,884 pounds, respectively.
AGRICULTURAL NOTES— The w eath er during the past month w as mild, and in a number of
localities considerable ea rly farm w o rk w as done. On the whole, how ever, the ground has been too
w et fo r plow ing. Soil is in excellent condition, w ith plenty of m oisture, and early prospects appear
to be unusually favorable. A cold spell at the end of F eb ru ary checked prem ature developm ent of
fru it buds, but m ost of M arch has been mild and there is considerable danger to fru it from a late
freeze. F e rtiliz e r sales during the ea rly p art of this season w ere much below those of the corre­
sponding period in 1926, w hich m ay affect yields of this season’s crops. M an y farm ers, especially
gro w e rs of cotton and dark tobacco, found last y ear unprofitable, and are forced to plant their 1927
crops at less expense than in m ore favorable seasons. The demand fo r farm labor has been below
the supply during the past month, but w hen h eavy w o rk gets fu lly under w a y additional help w ill
be needed and em ployed, and some scarcity of labor m ay develop.




5

FIGURES ON RETAIL TRADE
As Indicated B j Reports from Thirty-One Representative Department Stores for the Month of FEBRUARY 1927

Percentage increase in February 1927 sales over sales in February 1926:
Baltimore

Richmond

Washington

Other Cities

District

—
Percentage
—
Percentage
—
Percentage
—
Percentage

1.6
12.6
.4
— 2.9
.3
increase in total sales since Jan. 1st, over sales during the same two months in 1926:
2.1
5.8
— 1.4
— 2.5
— 1.2
increase in February 1927 sales over average February sales during the three years 1923-1925, inclusive:
1.2
23.5
11.7
6.6
6.2
increase in stock on hand February 28, 1927, over stock on February 28, 1926:
3.1
1.5
— .5
3.4
— 1.0
increase in stock on hand February 28, 1927, over stock on January 31, 1927:
4.9
2.8
9.6
9.8
6.9
Percentage of sales in February 1927 to average stock carried during that month:
21.1
24.0
24.6
18.4
22.2
Percentage of total sales since Jan. 1st, to average stock carried during each of the two months:
45.0
47.6
49.0
38.2
45.9
Percentage of outstanding orders on February 28th to total purchases of goods in 1926:
6.9
6.3
5.2
5.0
6.0
Percentage of collections in February to total accounts receivable on February 1st:
22.1
27.2
29.4
29.9
25.5
— Denotes decreased percentage.

R eta il trade, as reflected in sales of thirty-on e leading departm ent stores in the F ifth Fed eral R e ­
serve D istrict, w as three-tenths of I per cent g re a te r in dollar amount in F e b ru a ry 1927 than in F e b ­
ru a ry 1926, although the B altim ore stores averaged a decline of 1.6 per cent and the group of stores
in M iscellaneous Cities showed a decrease of 2.9 per cent. Richm ond sales increased 12.6 per cent
and W ashington sales gained four-tenths of 1 per cent. T o tal sales during the first tw o m onths of
1927 averaged 1.2 per cent below sales in the corresponding 1926 months, Richm ond w ith an increase
of 5.8 per cent show ing the only gain this year. F eb ru a ry sales this y ear averaged 6.2 per cent above
av e rag e F e b ru a ry sales during the three y ears 19 23-1925, inclusive, the B altim ore stores alone failin g
to reg iste r a gain.
A v e ra g e stocks on the shelves of the rep ortin g stores at the end of F e b ru a ry w ere 1.0 per cent
below those of F eb ru ary 28, 1926, in retail selling value, but w ere 6.9 per cent above those of Ja n u a ry
3 1s t this y ear, the latter increase being seasonal and due to the receipt of sp ring m erchandise.
The p ercen tage of sales to av erage stocks carried during F eb ru ary w as 22.2 per cent fo r the D is­
trict as a w hole, and the p ercentage of total sales during the first tw o months of this y e a r to ave rag e
stocks carried during each of the tw o m onths w as 45.9 per cent, indicating an annual turn over of 2.75
tim es.
Collections b y the reportin g stores during F e b ru a ry totaled 25.5 per cent of outstanding receiv­
ables on F e b ru a ry 1st, all cities show ing low er figu res than in Ja n u a ry .




6

WHOLESALE TRADE, FEBRUARY 1927
Percentage increase in February 1927 sales, compared with sales in February 1926:
3U Groceries

12 Dry Goods

6 Shoes

16 Hardware

5 Furniture

— 7.3
— 4.0
13.8
5.2
— 11.7
Percentage increase in February 1927 sales, compared with sales in January 1927:
— 6.3
4.7
18.1
— 7.5
17.3
Percentage increase in total sales since Jan. 1, 1927, compared with sales during the same two months
— 6.9
— 4.5
19.1
.3
— 29.5
Percentage increase in stock on February 28, 1927, compared with stock on February 28, 1926:
— 3.9(11)
— 13.9(5)
32.1(4)
— 7.3(7)
Percentage increase in stock on February 28, 1927, compared with stock on January 31, 1927:
— .1(11)
7.4(5)
— 1.4(4)
2.6(8)
Percentage of collections in February to accounts receivable on February 1, 1927:
59.9(21)
30.8(8)
27.1(5)
33.4(12)
37.4(3)

12 Drugs

— 4.3
— 13.8
in 1926:
— 6.8

51.3(8)

— Denotes decreased percentage.
NOTE:
The number of firms reporting stock and collection data in each group is shown immediately fol­
lowing the percentages.

E ig h ty-fiv e w holesale firm s, rep resen ting six leading lines, sent confidential reports on F e b ru ­
a r y ’s business to the F ed eral R eserv e B an k of Richm ond. F e b ru a ry sales w ere g re a te r than sales in
Ja n u a ry 1927 in dry goods, shoes and furniture, but w ere less in gro ceries, h ardw are and drugs. The
few er business days in F e b ru a ry doubtless accounted in part for the declines. In com parison w ith
F e b ru a ry 1926 sales, those made in F eb ru ary this y ear w ere less in all lines, except shoes and hard­
w are, which gained 13.8 per cent and 5.2 per cent, respectively. Shoe and h ardw are sales since J a n ­
u a ry 1s t w ere g re ater than sales during the first tw o months of 1926, but total sales for the tw o months
declined this y ear in groceries, d ry goods, furniture and drugs. P a rt at least of the decline in dry
goods w as due to low er prices fo r cotton goods this year, and much of the decrease in furn itu re sales
w as due to unusually large sales in Ja n u a r y 1926.
Stocks of dry goods and h arw are increased m oderately during F eb ru ary , w hile g ro ce ry and shoe
stocks declined v e ry slightly. A t the end of the month stocks of gro ceries, dry goods and hardw are
w ere low er than on F eb ru a ry 28, 1926, but shoe stocks w ere 32.1 per cent la rg e r on the 1927 date.
Collections during F e b ru a ry in gro ceries totaled 59.9 per cent of accounts receivable on F e b ru a ry
1st. D rugs, w ith an average of 5 1.3 per cent, ranked next in percentage of outstanding receivables
collected during the month, follow ed by furn itu re w ith 37.4 per cent, hard w are w ith 33.4 per cent,
d ry goods w ith 30.8 per cent, and shoes w ith 27.1 per cent. D ry goods, shoe, hardw are and furn itu re
p ercentages w ere higher in F e b ru a ry this y e a r than a y e a r ago, but g ro ce ry and d ru g figu res w ere
low er this year.




(Compiled March 19, 1927)

7

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

Industrial output increased further in February and was
slightly larger than a year ago, and distribution of commodities by
pre t
ecn
p r e t the railroads was larger than for the corresponding period of any
ecn
previous year. The general level of wholesale prices continued to
decline and was in February at the lowest level since the summer
of 1924.
PRODUCTION. Production of manufactures increased in Feb­
ruary for the second consecutive month, and the output of minerals,
after declining in January, advanced once more in February to the
record level reached last December. Factory production and em­
ployment, however, continued smaller than during the corresponding
month of last year. Production of iron and steel has increased
steadily since December, and reports indicate that operations of
steel mills in March were at almost the same high rate as in March,
1926. Automobile production increased from 234,000 cars in Janu­
ary to 298,000 cars in February, and weekly figures of employment
in Detroit factories indicate some further additions to production in
March, but output has continued much smaller than a year ago.
Daily average consumption of cotton by mills in February was
Index numbors of production of manufactures & minerals, adjusted
for seusonal variations (1923-25 average a 100). Latest figures,
larger than in any previous month on record, but activity of woolen
February, manufactures 106, minerals 120.
and silk mills decreased as compared with January. Production of
bituminous coal has been maintained in large volume, while that of
anthracite has been considerably reduced. The output of building
materials was smaller during the first two months of this year than
in the corresponding period of 1926. The value of building con­
tracts awarded in February was 3 per cent smaller than in the same
month of last year, but awards for the first three weeks in March
were in approximately the same volume as in 1926.
Contracts in
Southeastern and Northwestern states have been considerably
smaller than a year ago, while those in the Central West have been
much larger.
TRADE. Retail trade showed less than the usual seasonal
decline between January and February. Sales of department stores
and chain stores were larger than in February of last year, while
those of mail order houses were smaller. Wholesale firms reported
a smaller volume of business in February than a year ago, and this
decline occurred in nearly all leading lines. Inventories of depart­
ment stores increased in February in anticipation of the usual ex­
Indexes of U. S. Bureau of Labor Statistics (1913 = 100. Latest
figures, February, all commodities 146.4, non-agricultural com­
pansion in spring trade, but the growth was less than is customary
modities 148.3, agricultural commodities 113,8.
at this season and at the end of the month stocks were slightly
smaller than a year ago. Stocks of merchandise carried by whole­
sale firms also increased in February, but they were generally
smaller than in the corresponding month of last year.
Railroad shipments of commodities have increased steadily since
January by more than the usual seasonal amount and have exceeded
those for the same period last year, owing to larger shipments of
coal, of miscellaneous commodities, and of merchandise in less-thancarload lots.
PRICES. Wholesale prices, according to the index of the
Bureau of Labor Statistics, continued to decline in February. Among
non-agricultural products decreases occurred in the prices of coal,
petroleum, iron and steel, nonferrous metals, and lumber, and the
index for non-agricultural prices as a group was at the lowest post­
war level. Prices of livestock and livestock products and of clothing
materials advanced in February. During the first three weeks of
March there were decreases in prices of grains, livestock, sugar,
Federal Reserve Board's indexes of factory employment and pay­
silk, wool, coal, petroleum and gasoline, while prices of potatoes,
rolls (1919=100). Latest figures, February, employment 93,7,
payrolls 108.5.
pig iron, hides and rubber advanced.
BANK CREDIT. Demand for commercial credit at member
PERC EN T
6
banks in leading cities increased seasonally between the middle of
February and the middle of March. There was also growth in the
volume of funds used in the security market as indicated by in­
creases in loans to brokers and dealers in securities. Consequently
total loans of the reporting banks at the end of the period were
close to the level of last autumn. Financial operations of the United
States Treasury around the middle of March, with disbursements
temporarily in excess of receipts, resulted in a temporary abundance
of funds which was reflected at member banks in leading cities in
a growth of deposits, in reduced indebtedness at the reserve banks,
and in increased holdings of securities.
At the reserve banks, following changes in holdings of bills
and securities accompanying the financial operations of the Treas­
ury, the total volume of credit outstanding on March 23 was some­
what larger than four weeks earlier.
Conditions in the money market in March were slightly firmer
Weekly rates in New York money market:
nmcrcial paper rate on
than in February. Rates on prime commercial paper advanced from
4 to 6 months paper and acceptance rate l 90-day paper.
4 per cent to 4-4 x per cent and call money was also higher, while
/4
rates on acceptances declined somewhat,



8

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