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MONTHLY REVIEW
o f Financial and Business Conditions

F ifth
Federal

Reserve
Dist r ic t

May 31, 1938

Federal Reserve Bank, Richmond, Va.
? I "'H ERE was some seasonal rise in trade in the Fifth
Reserve district in April, due chiefly to the occur­
rence of Easter in that month, but industry in general
declined further. Retail trade as reflected in department
store sales rose in April approximately 10 per cent above
April 1937 sales, but sales in the first four months of
this year were 1.6 per cent less than sales in the corre­
sponding period last year, and after Easter retail trade
dropped back to a level considerably below that of 1937.
One of the outstanding developments in April and early
May was a further decline in operations in cotton textiles,
going so far as to shut down a number of mills tempo­
rarily. Coal production also decreased further, but prob­
ably not more than seasonally. Construction provided for
in April through permits issued and contracts awarded
made less than seasonal advance over March figures, and
most of the work provided for was of a public or semi­
public nature or was financed with public funds. Unem­
ployment apparently increased materially in April, especi­
ally in textile regions of the district. Discounts at the
Federal Reserve Bank of Richmond, after a moderate rise
in the preceding month, dropped back between the middle
of April and the middle of May to about the level before
the rise. Circulation of Federal Reserve notes declined
last month and there was also a small decrease in cash
reserves, but reserve deposits of member banks were
practically unchanged. Reporting member banks in lead­
ing cities reduced loans and discounts and cash in vaults,
but their investments in securities rose and demand de­
posits increased about 2 per cent between April 13 and




May 11.
seasonally
in general
debits in
numerous

Debits to individual accounts in April were
less than March debits, and reflected the decline
business this year by falling 12.8 per cent below
April 1937. Commercial failures were more
and liabilities were greater in the district in

A'pril than in April last year, but the increases were less
than the average increases for the United States. Regis­
tration of new automobile figures showed a moderate rise
in April over March, but were 46 per cent below April
1937 registrations. Rayon production in April was ap­
proximately equal to shipments, but shipments were
slightly lower than in March and materially smaller than
deliveries in April 1937. Spot cotton prices declined
around the first of May, but recovered most of the reces­
sion by the middle of the month. Agricultural work* is
well advanced for this season, grains are in good condi­
tion, fruit prospects, while lower than a year ago, are
probably above average, and rains around the middle of
May relieved excessive dryness which was developing
early in the month.
There follows a statistical
scribed above:
Debits to individual accounts (24
cities) ............................................
No. of business failures, 5th district
Liabilities in failures, 5th district. .
Sales, 54 dept, stores, 5th district...
Sales, 160 wholesale firms, 5th dist..
Registrations, new passenger autos.
Value bldg. permits (31 cities)........
Value of contracts awarded, 5th dist.
Cotton consumption, 5th dist. (bales)
Soft coal mined, U. S. (tons)........

summary of conditions de­
April 1938
$1,146,409,000
39
$
421,000
$ 10,444,659'
$ 11,035,000
14,092
$
8,861,313
$ 25,114,000
204,154
22,195,000

April 1937

%

Change

$1,314,915,000 — 12.8
36 + 8.3
$
34.8,000 +21.0
$
9,469,089 +10.3
$ 13,196,000 — 16.4
26,987 — 47.8
$
8,677,686 + 2.1
$ 32,606,300 —23.0
332,253 — 38.6
26,041,000 — 14.8

2

MONTHLY REVIEW

BA N K IN G CONDITIONS
R eserve B ank Statement : After a moderate rise be­
tween the middle of March and the middle of April, dis­
counts at the Federal Reserve Bank o f Richmond de­
clined between April 15 and May 15 by a little more than
the previous increase, and there was also a slight decrease
in industrial loans for working capital following an up­
turn in the 'preceding month. These two changes reduced
total earning assets of the Richmond bank by $838,000
between April 15 and May 15, but on the latter date
earning assets were $6,371,000 higher than on May 15 a
year ago, due chiefly to increased holdings o f Government
securities this year. Federal Reserve notes in actual cir­
culation declined by $3,176,000 last month, and at midMay were $5,226,000 less than notes in circulation on
May 15, 1937. Practically no change occurred in mem­
ber bank reserve deposits between April 15 and May 15,
but there was a decline o f $11,962,000 during the past
year. Cash reserves of the Federal Reserve Bank of
Richmond dropped slightly last month, but rose by $35,013,000 between May 15 last year and this. The balance
to the credit of the Treasurer of the United States in­
creased from $5,172,000 to $55,381,000.
000 omitted
May 15
Apr. 15
1938
1938

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

$

510
24
1,477
139,979
141,990
190,248
214,585
337,742
71.32

$

1,083
24
1,742
139,979
142,828
193,424
214,737
340,117
71.51

May 15
1937
$

363
54
2,167
133,035
135,619
195,474
226,547
302,729
69.66

t a t e m e n t o f 41 R e p o r t i n g M e m b e r B a n k s : Member
banks in 12 Fifth district cities reported a decrease in
loans between April 13 and May 11 of $3,137,000 and a
drop of $3,919,000 during the year. Investments in se­
curities rose by $4,235,000 last month, but declined $ 6 ,808,000 since May 12, 1937. On the other hand, reserve
balances of the 41 banks declined $1,835,000 during the
month but rose $2,823,000 during the year. Cash in vaults
declined $1,213,000 after the Easter holiday season. De­
mand deposits rose by $9,253,000 between April 13 and
May 11, but on the latter date showed a decrease of
$31,213,000 in comparison with demand deposits on May
12, 1937. Changes in time deposits were immaterial in
both the past month and year.

D e b it s t o I n d i v i d u a l A c c o u n t s :
Total debits to de­
positors’ accounts in the banks in 24 Fifth district cities
declined seasonally by 2.4 per cent in April in comparison
with the preceding month of March, income tax payments
in March normally exceeding quarterly payments debited
early in April. In comparison with April 1937 debits,
those for April 1938 were lower in every reporting city,
the average decline being 12.8 per cent and reflecting the
reduced volume of business this year.
000 omitted

CITIES

Apr.
1938

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

Mar.
1938

Apr.
1937

$ 337,582
7,249
8,165

$ 337,581
7,148
8,348

$ 370,813
9,122
9,309

Dist. of Col.
Washington . ..

253,283

245,401

Virginia
Danville..........
Lynchburg ........
Newport News .
Norfolk ..............
Portsmouth . . . .
Richmond ..........
Roanoke ............

7,000
13,496
7,886
45,774
4,047
133,041
23,297

West Virginia
Charleston ........
Huntington ___

% of Change
Month
Year
+
.0
+ 1.4
— 2.2

- 9.0
— 20.5
— 12.3

280,253

+

3.2

— 9.6

7,2,24
13,856
8,101
45,823
3,991
138,751
23,097

8,460
15,732
9,954
52,591
4,240
150,047
33,375

—
—
—
—
+
—
+

3.1
2.6
2.7
.1
1.4
4.1
.9

— 17.3
— 14.2
— 20.8
— 13.0
- 4.6
— 11.3
— 30.2

43,607
16,662

47,172
15,898

55,157
19,744

— 7.6
+ 4.8

— 20.9
— 15.6

Wilmington . . . .
Winston-Salem .

11,236
50,687
23,580
16,819
35,530
9,753
34,851

11,480
53,947
25,945
17,462
45,192
10,447
38,835

13,884
62,930
24,238
18,741
40,096
12,240
42,419

— 2.1
— 6.0
— 9.1
— 3.7
— 21.4
— 6.6
— 10.3

— 19.1
— 19.5
— 2.7
— 10.3
— 11.4
— 20.3
— 17.8

South Carolina
Charleston ........
Columbia ..........
Greenville ........
Spartanburg . . .
District Totals

16,181
22,541
16,125
8,017
$1,146,409

16,522
25,784
17,329
9,144
$1,174,478

19,577
28,937
22,325
10,731
$1,314,915

— 2.1
— 12.6
— 6.9
— 12.3
— 2.4

— 17.3
-2 2 .1
— 27.8
— 25.3
- 1 2 .8

North Carolina
Asheville ............
Charlotte ..........
Durham ............
Greensboro ........

S

000 omitted
Apr. 13
1938
1938

Loans and discounts...........................
Investments in securities .................
Reserve bal. with Fad. Res. b a n k ...
Cash in vaults .......................................
Demand deposits ..................................
Time deposits ........................................
Money borrowed ................................. .

May 12

$240,723
373,455
139,406
19,818
435,156
198,179
0

$241,505
384,498
134,748
19,688
475,622
198,825
4,500

May 11

ITEMS

........
........
........
........
, ,

377,690
137,571
18,605
444,409
198,355

1937

M utual
S a v in g s
Ban k
D e p o s it s :
Deposits in ten
mutual savings banks in Baltimore rose to a record total
of $219,926,013 on April 30, 1938, compared with $219,742,124 on March 31 this year and $216,372,167 on April
30 last year. Increases during the past month occurred in
only three banks, however, seven p i the ten reporting
slightly lower figures'at the end of April than a month
earlier.




B U SIN E SS CONDITIONS
E m ploym ent :
Statistics on employment are not avail­
able, but indications are that unemployment increased ma­
terially in the Fifth district in April and the first half
of May. Cotton textile mills restricted operating time
further in the second half of April, and many thousands
of workers were temporarily laid off. Coal miners also
worked fewer hours, with consequent reduction in pay
received. The number of people employed in tobacco
manufacturing plants remain moderately constant, but
many other less important industries are working small
forces. There has been some increase recently in employ­
ment in construction fields, but probably less than seasonal
trends should bring. Agricultural workers are scarce in
some sections of the district.
The following figures, compiled for the most part by
the Bureau of Labor Statistics from reports furnished by
a large number of identical industries, show the trends of
employment and payrolls in the Fifth district geographical
divisions from March to April 1938, the latest available
figures:
Percentage change from
Mar. 1938 to Apr. 1938

STATES
.....................
D. of Columbia ............................. ........................
.....................
North Carolina ............................ .......................
South Carolina ............................. .....................

In number
on payroll
+1.1

In amount
of payroll
— .8

+ 4 .5

+

—

.9

— 3.9
— 9.9

2.4

— 2.4

— 4.7

— 1.2

— 2.9

3

MONTHLY REVIEW
C o m m e r c ia l F a il u r e s :
The number of business fail­
ures in the Fifth district in April rose 8.3 per cent above
the number of bankruptcies in April last year, but the
United States as a whole increased 42.0 per cent. Like­
wise, an increase in liabilities involved in Fifth district
failures amounting to 2 1.0 per cent made a better record
than the National rise of 125.8 per cent in April liabili­
ties. The district record for four months this year is also
better than that of the Nation in both number of insol­
vencies and liabilities involved. Dun & Bradstreet insol­
vency figures are as follows:
Number of failures

PERIOD

District U. S.

April 1938 .........................
March 1938 .........................
April 1937 .........................

39
50
36

4 Months, 1938..................... .........193
4 Months, 1937..................... .........194

1,116
1,088
786
4,595
3,138

Total Liabilities

District

U. S.

$ 421,000
823,000
348,000

$20,106,000
15,567,000
8,906,000

$2,454,000
1,632,000

$64,067,000
38,260,000

C o n s t r u c t i o n : Building permits issued in 31 Fifth dis­
trict cities in April 1938 totaled $8,861,313, an increase
of 2.1 per cent over $8,677,686 for April 1937 permits,
in spite of decreases of approximately $ 1 ,000,000 in each
of the two largest cities, Baltimore and Washington. Sev­
eral smaller cities reported exceptionally high figures, due
chiefly to work done partly with public funds. Raleigh
reported two large apartment house projects, Charleston,
S. C., reported college buildings at the Citadel, and Rock
Hill reported an auditorium at Winthrap College. The
six highest figures reported for April were Washington
$1,819,410, Raleigh $1,274,276, Baltimore $1,141,381,
Charleston, S. C., $1,036,597, Winston-Salem $585,005,
and Rock Hill $403,845. Total permits issued in the first
four months of 1938 amounted to $27,737,332, compared
with $31,170,374 in the corresponding period last year.
Contracts actually awarded for construction in the Fifth
district in April totaled $25,114,000, in comparison with
contracts totaling $32,606,300 in April 1937, a decline of
23 per cent. Contract awards broken down by states are
now available for March in F. W. Dodge Corporation re­
ports, and are as follows for the Fifth district:

Construction Contracts Awarded
STATES
Maryland...........................
Dist. of Col........................
Virginia ..........................
West Virginia ...............
North Carolina ..............
South Carolina ...............
Fifth District ...........

March 1938
., ..
. .,.
. ..
... .

$ 5,211,000
3,077,000
4,883,000
3,566,000
4t459,000
3,396,000
$24,592,000

March 1937
$ 3,772,000
3,887,000
5,488,000
1,332,000
7,908,000
2,171,000
$24,558,000

% Change
+ 38.1
— 20.8
— 11.0
+ 167.7
— 43.6
+ 56.4
+
.1

Some large contracts let in the Fifth district in March
were Buckingham Apartments at Arlington, Va., $700,000; U. S. Government Hangars at Washington, D. C.,
$448,000; a Du Pont plant at Belle, W. Va., $500,000;
municipal auditorium at Charleston, W. Va., $450,000; an
apartment house at Raleigh, N. C , $650,000; and college
buildings at Charleston, S. C., $525,000.
A utomobile N ew C ar R egistrations : Sales o f new
passenger automobiles in April increased 12.7 per cent
over March sales in the Fifth Reserve district, but ran
47.8 per cent behind sales in April last year. Cumulative
sales in the first four months o f 1938 fell 46.2 per cent
below sales in the corresponding period in 1937. Virginia
with a decrease o f 39.9 jper cent has the best record for
the four months, while W est Virginia shows the largest




decrease with 55.4 per cent. The market for second hand
cars is very poor, especially for the older models which a
year ago sold more readily than cars only one or two
years old.
Registration of N«w Passenger Cars
4 Months 4 Months
April
April
%
%
Change
1938
1937
Change
1938
1937
Maryland .........
Dist. of Col. ..,
West Va............
No. Carolina . . .
So. Carolina .. .
District ........

2,686
1,936
3,383
1,698
3,144
1,245
14,092

4,671
3,061
6,001
4,590
5,995
2,669
26,987

— 42.5
— 36.8
— 43.6
— 63.0
— 47.6
— 53.4
— 47.8

8,714
5,921
10,611
5,196
9,733
4,876
45,051

15,630
10,236
17,642
11,653
18,692
9,882
83,735

— 44.2
— 42.2
— 39.9
— 55.4
— 49.7
— 50.6
— 46.2

oal M in in g :
Production of bituminous coal in April
continued to decline, falling to 22,195,000 net tons in
comparison with 26,745,000 tons in March 1938 and
26.041.000 tons in April 1937. On a daily basis, produc­
tion in April totaled 881,000 tons, compared with 991,000
tons in March this year and 1,033,000 tons in April last
year. The total production this calendar year through
April amounted to 107,233,000 net tons, a decrease of
33.4 per cent below 161,064,000 tons mined in the first
four months of 1937.
Shipments of coal through
Hampton Roads ports to May 7 totaled 6,142,373 tons
this year and 8,217,216 tons last year. Reserve stocks of
bituminous coal declined in the first quarter of 1938, and
on April 1 stood at 35,380,000 net tons. This was a de­
crease of 11,694,000 tons, or 24.8 per cent, below the
reserves on the first day of the year. Compared with the
stocks on April 1 a year ago, the decrease amounted to
17.773.000 tons, or 33.4 per cent.

C

C o t t o n T e x t i l e s : Cotton mills in the Fifth district re­
duced operations further in the second half of April, and
cotton consumption on a daily basis totaling 20,000 bales
in the United States compared with daily consumption of
22,200 bales in March 1938 and 32,700 bales in April
1937. Demand for cotton textiles was very slow last
month and even the limited mill production exceeded sales
except in the week ended May 13. Goods in retail estab­
lishments are not excessive, but trade has declined since
Easter and stores are buying for immediate needs only.
The marked recession in the automobile industry has seri­
ously affected the cotton textile industry, automobile and
tire manufacturers being the largest industrial consumers
of textile products. Consumption of cotton by states in the
Fifth district in April 1938, March 1938, April 1937, and
in the first four months of this year and last is shown in
the accompanying table:

MONTHS

No. Carolina So. Carolina Virginia

District

April 1938 .................................
March 1938 ..............................
April 1937 .................................

109^676
135,218
183,425

84,296
102,411
133,239

10,182
13,520
15,589

204,154
251,149
332,253

4 months, 1938 .......................
4 months, 1937 .........................

474^004
728,229

362,252
530,283

44,207
58,473

880,463
1,316,985

Spindle activity in March was somewhat greater than
in February, and with the added influence of the longer
month the average hours of operation per spindle in place
rose from 210 hours to 245 hours. South Carolina led
the district with an average of 302 hours, but was second
to Tennessee’s 314 hours in the United States. Virginia
mills averaged 280 hours for fourth place in the Nation,
and North Carolina 247 hours for eighth place. Total
spindle hours of operation in March numbered 6,485,416,003 hours, of which the Fifth district reported 3,392,131,-

MONTHLY REVIEW

4

533 hours, or 52.3 per cent. South Carolina led all states
in total hours of operation in March 1938 with 1,716,099,029 hours, or 26.5 per cent of the total for the United
States.
ayon :
The daily rate of rayon yarn deliveries by pro­
ducers during April is measured by the Rayon Organon
index of 444, which represents a slight decline from the
March index of 455 and compares with 702 for April
1937. Producers’ stocks at the end of April represented
a 3.5 months’ supply, based on average shipments over the
previous 12 months. According to figures of the Na­
tional Rayon Weavers Association, loom activity in April
was somewhat lower than in March, but a relatively stable
operating rate is now in effect. Loom) activity since Feb­
ruary fluctuated between the narrow limits of 45 to 55
per cent of capacity. During the first quarter of 1938,
production of rayon yarn in the United States totaled
57.500.000 pounds, compared with 73,800,000 pounds in
the preceding quarter, ended December 31, 1937, and
76.800.000 pounds in the first quarter of 1937. Rayon
pulp prices, which were raised last Fall from $72.50 per
ton to $97.50 per ton, were lowered to $85.00 per ton
for the period from May to; December 1938.

R

average price for middling grade short staple cotton
dropped from 8.95 cents per pound on April 22 to 8.72
cents on May 6 , but rose to 8.79 cents on May 13, the
latest date for which official quotations are available.
Consumption of cotton in American mills in April was
off 42 per cent from figures for April 1937, but exports
of cotton were slightly higher in the 1938 month.
Cotton Consumed and On Hand
(Bales)

April
1938

April
1937

204,154

332,253

351,934
Cotton consumed ..................
Cotton on hand April 30 in
Consuming establishments . . 1,417,131
Storage & compresses ....... 10,399,273

1,630,480
4,105,737

Fifth District States:

Cotton consumed ..................
Cotton growing states:

595,675

United States:

414,392
Cotton consumed ..................
Cotton on hand April 30 in
Consuming establishments . . 1,703,045
Storage & compresses ....... 10,485,880
377,250
Exports of co tto n ......................

718,975
1,986,694
4,214,825
373,158

obacco
M a n u f a c t u r in g :
The Bureau of Internal
Revenue reports tobacco products manufactured in April
1938 and 1937 as follows:

T

April 1938
C

o tto n

:

Spot cotton prices on 10 Southern markets de­
clined during the last week in April and the first week
in May, but rose slightly in the second week of May. The
R

e t a il

T

W

rade

in

D

epartm ent

Net Sales
Apr. 1938
comp, with
April
1937
Richmond (3 )..
Baltimore (8) . .
Washington (6)
Other Cities (13)
District (30) .
Same stores by
States, with 24
stores added:
Virginia (13) . .
West Va. (9). . .
No. Carolina (7)
So. Carolin (10)




+ 15.3
+ 12.3
+ 9.5
— 1.2
+ 10.2

+
—
—
—
—

4.9
2.0
1.8
6.9
1.6

+ 12.6

+
—
—
—

3.8
9.6
5.5
9.1

—

1.0

+ 1.5
—

1.0

S

tores

:

Net Sales
Stocks
Jan. 1 to date Apr. 30, 1938
comp, with
comp, with
Same period Apr. 30 Mar. 31
1937
1938
Last year
+
—
—
—
—

2.7
8.4
9.1
3.9
7.0

+
—
+
+
+

.9
.7
.6
.5
.1

Ratio Apr.
collections
to accounts
outstanding
Apr. 1
31.4
30.6
27.2
27.9
28.8

holesale

T

rade,

160

F

April 1937

24,571,202
12,526,722,723
384,918,261
2,937,411

Smoking & Chewing
Tobacco, Pounds .............
Cigarettes, Number ...............
Cigars, Number ......................
Snuff, Pounds ........................

26,785,686
12,209,822,610
453,007,930
3,242,079

ir m s

% Change
— 8.3
+ 2.6
—15.0
— 9.4

:

Net Sales
Stocks
Ratio Apr.
April 1938
Apr. 30, 1938
collections
comp, with
comp. with
to accounts
Mar. Apr. 30
Mar. 31 outstanding
Apr.
1938 1937
1938
April 1
1937
-24.8
— 35.7
—20.0
63.6
— 10.2
+ 2.5
100.8
— 5.8
Drugs (14) .................... - 7.4
+ 4.0
— 4.3
— 8.6
—22.0
42.3
Dry Goods (7) ............... —24.9
— 1.9
—31.9
+ 10.0
— 5.3
85.6
Electrical Goods (27)
— 4.1
— 6.9
— 14.1
110.5
Groceries (42) ............... —14.8
—25.0
— 9.6
— 1.8
48.2
Gen. Hardware (22)
+ .3
—30.8
+ 10.8
— 7.3
71.9
Indus. Supplies (10)..
+ .6
+ 18.3
— 11.7
58.7
Plumbing & Heating (8) — 17.9
+ 4.7
+. 5.5
— 3.6
5.1
36.6
Paper & Products (6) . . — 4.4
+ 1.9
76.1
Tobacco Products (5)
+ -5
— 1*0
— 5.1
+ 4.4
—’ 4.8
63.9
Miscellaneous (15) .......
— 3.4
— 11.1
68.0
All Firms (160) ....... — 16.4
— 2.9
Note: The wholesale trade figures are included by arrangement with
the Bureau of Foreign & Domestic Commerce. Only 122 of the 160 whole­
sale firms reported on receivables and collections, and only 94 on stocks.

(Compiled May 21, 1938)

MONTHLY REVIEW, May 31, 1938

FEDERAL RESERVE BANK OF RICHMOND

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

Industrial production declined in April, reflecting chiefly reduced activity
in the cotton textile and lumber industries. Distribution of commodities in­
creased less than seasonally but continued to be somewhat in excess o f pro­
duction. Commodity prices showed a further decrease.
PRODUCTION

Index of physical volume of production, adjust­
ed for seasonal variation, 1923-1925 averages
100. By months, January 1934 to April 1938.

FACTORY EM PLO YM ENT AND PAYROLLS

In April volume of industrial production, as measured by the Board’s sea­
sonally adjusted index, was at 77 percent of the 1923-1925 average as compared
with the level of about 79 percent maintained during the first quarter of the
year. The decline reflected, chiefly, considerable reductions in output at cotton
textile mills and lumber mills, where there had been moderate increases in
production in March. In most other manufacturing industries changes in ac­
tivity were largely seasonal in character. Output at steel mills continued at
around 33 percent of capacity and in the automobile industry showed little
change, amounting in April to about 40 percent of the volume of a year ago.
In the first three weeks of May production of steel and aumobiles was at a
lower rate than in April. At mines there was a considerable decline in output
of anthracite in April, while bituminous coal production showed somewhat less
than the usual seasonal decrease. Crude petroleum production continued in
large volume.
Value of construction contracts awarded, which had increased considerably
in March, showed little change in April, according to figures of the F. W. Dodge
Corporation. Awards usually increase somewhat further in April. In the first
four months of this year private residential building was about one-fourth less
than in the corresponding period last year, while other private work, particu­
larly industrial and utility construction, was only about one-half as large as a
year ago. Awards for public projects were somewhat larger than last year.
EMPLOYMENT

Indexes of number employed and payrolls, with­
out adjustment for seasonal variation, 1923-1925
average=100. By months, January 1934 to April
1938. Indexes compiled by U. S. Bureau of Labor
Statistics.

DEPARTM ENT STORE S A L E S

Factory employment and payrolls declined from the middle of March to
the middle of April, and the Board’s seasonally adjusted index of employment
was at 79 percent of the 1923-1925 average as compared with 82 in March and
84 at the beginning of the year. The number employed at automobile factories
declined sharply and there were further substantial decreases in the steel and
machinery industries and at railroad repair shops. Smaller declines were re­
ported in most other manufacturing industries. Employment at mines and on
the railroads also decreased, while in trade there was some increase in the
number employed, reflecting partly increased business at the Easter season.
DISTRIBUTION

Distribution of commodities to consumers showed less than the usual sea­
sonal rise in April. The Board’s adjusted index of department store sales was
83 in April compared with 86 in March and 90 at the beginning of the year,
and figures for the first half of May indicate a further decrease.
Freight-car loadings also declined from March to April, reflecting largely
reduced shipments of miscellaneous freight, and were about 30 percent less
than in April 1937.
COMMODITY PRICES

Indexes of value of sales, 1923-1925 average—
100. By months, January 1934 to April 1938.

Wholesale prices of industrial commodities continued to decline from the
middle of April to the third week of May and prices of agricultural products
also decreased somewhat further. Steel scrap, copper, and rayon showed con­
siderable declines and there were reductions in prices of some finished industrial
products. It was announced that prices of most finished steel products would
be unchanged for third quarter delivery.
BANK CREDIT

Total loans and investments of reporting member banks in 101 leading
cities showed little change during April and the first half of May. Holdings
of United States Government obligations increased somewhat, while holdings
of other securities and loans declined. Adjusted demand deposits in leading
cities increased during the period as a result of expenditures by the Treasury
from its balances with the Reserve banks. Interbank deposits also increased
substantially.
Member bank reserves increased further, reflecting principally Treasury
disbursements from its deposits at the Reserve banks, including retirement of
$50,000,000 of Treasury bills each week.
MONEY RATES AND BOND YIELDS
Wednesday figures for reporting member banks
in 101 leading cities. September 5, 1934, to May
18, 1938. Total deposits, excluding interbank, are
adjusted to exclude “ float” .




Yields on Government securities declined slightly further in the four weeks
ending May 21 to an average for longer-term Treasury bonds of 2.28 percent.
The average yield on 3- to 5-year Treasury notes declined to a new low of 0.73
percent. The rate on three-month Treasury bills continued at record low
levels, and other open-market money rates remained unchanged.

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