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MONTHLY REVIEW BUSINESS AND AGRICULTURAL CONDITIONS WILLIAM W. HOXTON, CHAIRMAN AND FEDERAL RESERVE AGENT RICHMOND, VIRGINIA DISTRICT SUMMARY. Business in the Fifth F e d e r a l reserve district made seasonal gains in October over the volume of business done in September, and probably somewhat ex ceeded that of October last year. There are some barometers at present that are less favor able than a year ago, but on the whole the out look this fall is better than in November 1927. Returns from the leading crops of the Fifth dis trict are less this year than last, except for fruit and livestock, and this retards the usual fall liquidation of bank loans and the settlement of other accounts. Wholesale trade in October was in less amount than in October 1927 in five of six important lines for which statistics are avail able. On the other hand, labor in the cities is better employed than a year ago, with a result ing increase in the city purchasing power to compensate at least in part for the lowered pur chasing power of the farmers. Debits to indi vidual accounts during the past month, while lower than last year, were materially larger than debits in the preceding month this year, indicating a normal increase in fall trade. Busi ness failures in the Fifth district last month were seasonally less numerous than in September and were only two insolvencies above the number reported in October 1927, while last month’s liabilities were lower than those of either Sep tember 1928 or October 1927. Coal mines are seasonally busy, and in October mined more bi tuminous coal than in October last year. Tex tile mills consumed more cotton in October than in either September this year or October 1927, and buyers of textile products have recently shown more interest in placing orders than in earlier months this season. Building permits issued and contracts actually awarded in the district last month exceeded those of October last year, which seems to promise well for em ployment. Finally, retail trade in department stores in the Fifth district exceeded the trade of September by nearly 30 per cent, and in spite of unseasonally warm weather this year was in slightly larger volume than in October 1927. RESERVE BANK OPERATIONS. Mem ber banks seasonally decreased their rediscounts at the Federal Reserve Bank of Richmond from $50,666,000 on October 15, 1928, to $42,436,000 on November 15th, reflecting fall liquidation of NOVEMBER 30, 1928 customers’ indebtedness as a result of crop mar keting. The decrease in rediscounts was among country banks chiefly, the city bank borrowing at the reserve bank having increased somewhat during the month under review. A greater de mand for currency in connection with crop mar keting and the opening of fall retail trade raised the circulation of Federal reserve notes from $69,896,000 on October 15th to $79,566,000 on November 15th. Total earning assets of the Richmond reserve bank increased slightly last month, rising from $70,224,000 at the middle of October to $71,700,000 at the middle of Novem ber, an increase in holdings of bankers’ accept ances purchased in the open market exceeding the reduction in rediscounts. Member bank re serve deposits rose from $67,799,000 on October 15th to $68,206,000 on November 15th, a daily fluctuation only. The several changes in the statement mentioned above, with others of less importance, raised the cash reserves of the Fed eral Reserve Bank of Richmond from $79,550,000 at the middle of October to $83,610,000 at the middle of November, but the seasonal increase in Federal reserve note circulation lowered the ratio of cash reserves to note and deposit lia bilities combined from 56.04 per cent on October 15, 1928, to 55.69 per cent on November 15, 1928. At the middle of November 1927, the Federal Reserve Bank of Richmond held rediscounts for member banks amounting to only $20,535,000, compared with $42,436,000 held on the corres ponding date this year. Federal reserve notes in circulation a year ago totaled $76,509,000, compared with $79,566,000 on November 15, 1928. Total earning assets of the Richmond bank, which amounted to $80,522,000 on November 15, 1927, and $71,700,000 on November 15, 1928, were higher last year than this, due to larger holdings of bankers’ acceptances and Government securi ties in November 1927. Member bank reserve deposits declined during the year from $75,065,000 to $68,206,000. The changes in the state ment during the year raised the cash reserves of the Federal Reserve Bank of Richmond from $74,024,000 on November 15, 1927, to $83,610,000 on November 15, 1928, and also raised the ratio of cash reserves to note and deposit liabilities combined from 47.52 per cent to 55.69 per cent between the middle of November last year and this. CONDITION OF SIXTY-FOUR REPORTING MEMBER BANKS IN SELECTED CITIES ITEMS Nov. 14, 1928 Oct. 10, 1928 Nov. 16, 1927 Loans Secured by U. S. Government Obligations................ Loans Secured by Other Stocks and Bonds.......................... All Other Loans and Discounts, Largely Commercial......... Total Loans and Discounts....................... ................ Total Investments in Bonds and Securities........................ Reserve Balance with Federal Reserve Bank.................... Cash in Vaults.......................................................................... Demand Deposits .................................................................... Time Deposits .......................................................................... Borrowed from Federal Reserve Bank.................................. $ 2,645.000 186.373.000 334.193.000 523.211.000 153.947.000 42.456.000 12.599.000 365.764.000 243.460.000 26.311.000 $ 2,553,000 179.626.000 335.768.000 517.947.000 156.384.000 40.832.000 12.759.000 359.350.000 247.445.000 22.490.000 $ 4,889,000 159.603.000 359.127.000 523.619.000 177.395.000 45.469.000 13.939.000 399.439.000 243.887.000 9,499,000 The accompanying table shows the principal items of condition of sixty-four regularly report ing member banks as of three dates, November 14, 1928, October 10, 1928, and November 16, 1927, thus affording an opportunity for comparing the latest available figures with those of the corres ponding dates a month and a year earlier. It should be understood that the figures in the table reflect conditions as of the report dates only, and are not necessarily the highest or lowest figures that occurred during the interval between the dates. Between October 10th and November 14th, both this year, an unseasonal increase occurred in outstanding loans to their customers by the sixty-four reporting banks, discounts and loans held rising $5,264,000 between the two dates. “All other loans and discounts,” which are largely com mercial or agricultural, decreased $1,575,000 during the month, but loans on Government securities rose $92,000 and loans on miscellaneous stocks and bonds rose $6,747,000. The reporting banks de creased their investments in bonds and securities by $2,437,000, and increased their rediscounts at the reserve bank by $3,821,000 during the period. The banks increased their reserve accounts at the reserve bank by $1,624,000, but their cash in vaults declined by $160,000. The increase in loans to customers and the transfer of Christmas Savings Club funds from time to demand deposits naturally increased demand deposits, the total rising $6,414,000 during the month. Time deposits, on the other hand, decreased $3,985,000 between October 10th and November 14th, an amount probably approx imating the Christmas Savings Club transfer in the reporting banks. During the year between November 16, 1927, and November, 14, 1928, total loans to customers by the sixty-four reporting banks remained practically unchanged, but there was a marked shift in the types of loans. During the year under review, loans secured by Government securities declined $2,244,000, and commercial and agricultural loans declined $24,934,000, but loans on stocks and bonds other than Government securities rose $26,770,000. Investments in bonds and securities declined $23,448,000 between the middle of November last year and this. The reporting banks reduced their reserve deposits at the reserve bank by $3,013,000 during the year, and their cash in vaults dropped $1,340,000. Demand deposits declined $33,675,000 and time deposits declined $427,000 during the year. The reporting banks increased their borrowing at the reserve bank by $16,812,000 between Novem ber 16, 1927, and November 14, 1928. DEBITS TO INDIVIDUAL ACCOUNTS Debits to individual, firm and corporation accounts in clearing house banks in twenty-four lead ing trade centers of the Fifth reserve district totaled $1,606,601,000 during the five weeks ended No vember 14th this year, an increase of $20,981,000 over the preceding five weeks ended October 10th, when debits aggregating $1,585,620,000 were reported. The earlier period contained a large volume of quarterly payments on October 1st, and the occurrence of the Election day holiday during the later period gave the earlier period an additional business day. In view of these facts, the larger figures reported for. the five weeks ended November 14th apparently reflect a very satisfactory be ginning of fall business. Sixteen of the twenty-four cities reported higher figures for the more recent period. Figures for both 1928 and 1927 are available from, twenty-three cities. In comparison with the five weeks ended November 16, 1927, when debits totaling $1,681,125,000 were reported, the aggre gate of $1,606,601,000 reported for the corresponding period ended November 14th this year shows a decrease of $74,524,000. Only seven cities reported higher 1928 figures, these being Charleston, W. Va., Columbia, S. C., Cumberland, Md., Lynchburg, Va., Newport News, Va., Spartanburg, S. C , Washington, D. C. Part of the district decrease this year was doubtless due to the fact that the period ended on the fourteenth of November, while last year the corresponding period ended on the sixteenth and therefore contained the fifteenth of the month payments. 2 CITIES 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...................................................... Portsmouth, Va................................................ Raleigh, N. C.................................................. Richmond, Va................................................... Roanoke, Va..................................................... Spartanburg, S. C. ...................................... Washington, D. C............................................ Wilmington, N. C............................................ WinstonnSalem, N. C...................................... District Totals.......................... ........... TOTAL DEBITS DURING THE FIVE WEEKS ENDED November 14, 1928 $ 30,843,000 452,933,000 30,300,000 45,606,000 69,877,000 29,344,000 11,642,000 15,916,000 41,440,000 29,756,000 29,945,000 12 ,120,000 25,562,000 24,090,000 12,404,000 80,714,000 6,404,000 28,539,000 179,827,000 32,920,000 21,650,000 321,248,000 23,918,000 49,603,000 $1,606,601,000 October 10, 1928 $ 43,990,000 448,525,000 26,832,000 43,440,000 66,459,000 26,555,000 12,383,000 10 ,010,000 40,041,000 27,019,000 25,229,000 12,325,000 26,337,000 27,578,000 12,069,000 71,024,000 5,917,000 27,920,000 185,986,000 34,261,000 16,579,000 326,769,000 19,388,000 48,984,000 $1,585,620,000 November 16, 1927 $ 32,885,000 511,268,000 34,826,000 44,779,000 72,910,000 28,407,000 11,587,000 19,763,000 50,026,000 33,682,000 41,127,000 12,521,000 29,774,000 21,891,000 10,771,000 *92,793,000 . 28,796,000 192,669,000 33,266,000 21,015,000 274,954,000 25,047,000 56,368,000 $1,681,125,000 * This Norfolk figure contains debits for Portsmouth also. SAVINGS; DEPOSITS—Total deposits in twelve mutual savings banks in Baltimore at the end of October this year totaled $186,476,148, compared with $184,837,715 on deposit at the end of Sep tember this year and $172,489,175 at the end of October 1927. On November 14, 1928, eighty-four regularly reporting member banks in leading cities of the Fifth reserve district had time deposits ag gregating $243,460,000, compared with $247,445,000 on October 10th this year and $243,887,000 on November 16th last year. BUSINESS FAILURES —In reviewing the business mortality record for October, Dun's Review of November 3rd says, “ In keeping with the normal seasonal trend, the number of commercial fail ures in the United States increased during October, totaling 2,023. The liabilities, moreover, also were higher than in the immediately preceding month, aggregating $34,990,474. The foregoing fig ures reflect a considerable numerical expansion, although it should be pointed out in this connection that such a tendency invariably appears in the closing months of a year. The number of defaults for October is 23.7 per cent above the 1,635 insolvencies of the shorter month of September, but the rise in the indebtedness is only 3.0 per cent. When comparison is made with the returns for a year ago, it is seen that the present number is larger by 13.2 per cent than the 1,787 defaults of October 1927, whereas the indebtedness for last month is 3.4 per cent under the $36,235,872 of the earlier year. The exhibit as to the liabilities of last month's insolvencies is, therefore, quite satisfactory, in view of the increased number of failures.,, In the Fifth reserve district, commercial failures in October 1928 numbered 106, compared with 119 in September this year and 104 in October last year. The aggregate liabilities reported for Oc tober totaled $1,633,885, a lower amount than either the $2,700,752 reported for September 1928 or $1,761,672 for October 1927. The Fifth district record for October is therefore contrary to the sea sonal and the national trend, both the number of failures and the total of liabilities involved being less last month than in September. LABOR—Employment conditions appear to be distinctly better than they were at this time last year or earlier in 1928. Industrial plants are generally operating at or near full time in the Fifth dis trict, building construction is more active than in the fall of 1927, coal mines are seasonally busy, tex tile mills are securing more orders than a few months ago, and tobacco factories are working to capacity on holiday business. COAL—The total production of bituminous coal in the United States in October 1928 amounted to 50,360,000 net tons, as against 41,301,000 tons mined in September this year and 43,827,000 tons in October 1927, according to the November 17th report of the Bureau of Mines, Department of Com merce. The average daily rate of production in October was 1,863,000 tons, an increase of 10 per cent over the September rate. Total production during the present calendar year to November 10th (ap proximately 266 working days) amounted to 419,050,000 net tons, compared with 452,492,000 tons mined during the same period in 1927. West Virginia continued to lead all states in production dur 3 ing October. Activity in the steel, automobile and other industries during recent weeks accounts for part of the increase in production figures in comparison with October last year. The increase over September figures is largely seasonal, but was larger this year than in October 1927. Retail coal yards have full stocks of all sizes in their bins, but the mild weather of October and most of November materially retarded retail sales of coal. TEXTILES —Textile mill authorities continue to view the prospects in their business more fav orably than they did two or three months ago, and output of manufactured cotton goods in the Fifth district increased sharply in October in comparison with September, Cotton consumption by Fifth District mills totaled 271,094 bales in October this year, a higher figure than 213*069 bales used in September this year and 260,114 bales consumed in October 1927. North Carolina mills used 142,653 bales last month, South Carolina mills consumed 119,346 bales, and Virginia mills used 9,095 bales, higher figures in each case than consumption figures for September and also higher in the two Carolinas than the figures for October last year. Department of Agriculture cotton crop estimates this fall have led to the conclusion that the year’s yield will not be larger than the mills need for a working margin, and interest in cotton goods has therefore been stimulated. Cotton prices, and prices of textiles, are somewhat lower than a year ago, but the important factor in the present market seems to be the element of stability which was absent earlier in the season before fairly accurate predic tions as to the size of the 1928 cotton crop could be m3.de. BUILDING OPERATIONS FOR THE MONTHS OF OCTOBER 1928 AND 1927. Permits Issued 0 CITIES z New Repairs 1928 1927 1 Baltimore, Md. ... 389 8 2 Cumberland, Md... 4 3 Frederick, Md.... . 24 4 Hagerstown, Md... 27 5 Danville, Va......... 22 6 Lynchburg, Va.... 70 7 Norfolk, Va........ . 9 8 Petersburg, V a...... *27 9 ^PnrtQmnnth V?i 10 Richmond, Va....... 90 11 Roanoke, Va...... ... 54 5 12 Bluefield, W. Va... 57 13 Charleston, W. Va. 35 14 Clarksburg, W. Va. 37 15 Huntington, W. Va. 24 16 Parkersburg, W. Va.... 29 17 Asheville, N. C...... 90 18 Charlotte, N. C.... 55 19 Durham, N. C...... 48 20 Greensboro, N. C. 21 High Point, N. C... 37 33 22 Raleigh, N. C....... 14 23 Rocky Mount, N.C. 4 24 Salisbury, N. C.... 16 25 Wilmington, N. C... 26 27 28 29 30 31 Winston-Salem, N. C._ 97 Charleston, S. C... Columbia, S. C .... Greenville, S. C,.... Spartanburg, S. C. Washington, D. C. 16 19 203 21 20 New Construction 1928 1927 298 1,238 22 10 6 7 28 16 16 85 5 105 61 17 50 31 53 27 25 58 60 60 42 31 14 15 9 97 16 19 10 35 180 16 9 28 98 10 *37 73 24 4 11 15 5 8 43 36 2 46 7 18 6 6 7 102 24 64 36 32 546 1928 1927 740 $ 1,720,100 $ 815,800 44,165 25,338 ?43,050 470 10 ,25,950 551,320 14 47,078 51,635 27 35,881 120,780 97 181,710 425,500 7 15,035 “ 61,450 *233,320 77 635,619 277,087 49 145,805 139,432 7 3,780 43,080 8 176,185 103,048 6 55,368 77,620 4 60,030 99,056 4 69,350 71,100 49 171,790 176,260 31 427,386 339,325 4 206,200 289,840 351,706 87 299,210 170,400 9 137,200 136,100 10 247,185 4 23,385 17,960 9,925 12 53,540 11 41,600 23,200 94 270,090 303,250 26 196,025 25,060 49 60,300 77,800 27 82,900 57,200 46,390 17 82,285 422 2,519,415 1,907,885 to Z Totals............. 1,557 1,492 2,530 1,906 $ 7,951,267 $ 6,921,367 Alterations 1928 $ 622,000 $ 1,950 5,535 45,225 3,073 11,080 58,985 55,650 *21,090 43,923 9,680 1,615 78,750 6,560 2,000 8,600 21,519 37,545 1,200 11,843 4,370 14,995 3,575 6,585 13,650 32,794 8,588 19,485 10,435 4,625 385,605 $1,531,440 1927 Increase or Per Cent of Decrease Increase of 0 or Total 2 Valuation Decrease 185,000 $ 1,341,300 134.09& 1 805 76.4 19,972 0 — 37,045 — 86.1 3 6,125 — 486,270 — 87.2 9.0 3,115 4,515 5 88,171 6.3 7,808 6 77,035 87.2 225,740 7 5,550 96,515 468.9 8 9 58,847 — 373,456 — 53.8 10 35,669 — 19,616 — 11.2 11 1,975 — 39,660 — 88.0 12 32,813 87.6 13 119,074 2,250 — 17,942 — 22.5 14 3,450 — 40,476 — 39.5 15 1,000 8.1 16 5,850 29,175 — 12,126 — 5.9 17 364,445 — 238,839 — 33.9 18 6,050 — 88,490 — 29.9 19 96,487 — 32,148 — 8.1 20 2,840 24.8 21 34,730 5,685 — 101,775 — 40.2 22 4,100 22.2 23 4,900 4,100 — 41,130 — 71.4 24 20,700 11,350 25.9 25 39,598 — 39,964 — 11.7 26 17,685 161,868 378.7 27 12,750 — 10,765 — 11.9 28 9,615 26,520 39.7 29 3,710 — 34,980 — 40.7 30 364,795 632,340 27.8 31 $1,483,540 $ 1,077,800 12.8# 2 4 — Denotes decrease. * Portsmouth figures not included in totals. 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. Although 16 of 30 leading cities in the Fifth Federal reserve district reported lower valuation figures for building permits issued in October 1928 than in 1927, the aggregate valuation figure for the 30 cities last month was 12.8 per cent above the total for October last year, most of the increase being accounted for by an unusually low figure reported last year for Baltimore. The number of permits for new construction issued by the 30 cities in the district last month was i,557> compared with 1,277 issued in September this year and 1,492 issued in October 1927. Valuation figures for new work totaled $7,951,267 for October 1928, $13,018,049 for September 1928, and $6,921,367 for October 1927. The high figure for September was due to permits totaling over $6,000,000 in Baltimore and nearly $4,000,000 in Washington, the aggregate for October outside of these two cities exceeding 4 the aggregate for September. Alteration and repair permits totaled 2,530 last month, compared with 2,183 in September this year and 1,906 in October last year, while valuation figures for alteration and repair work totaled $1,531,440 for October 1928, $1,290,940 for September 1928, and $1,483,540 for October 1927. Valuation figures for all classes of work last month totaled $9,482,707, an increase of $1,077,800, or 12.8 per cent, over total valuation of $8,404,907 for October 1927. Baltimore, Peters burg and Charleston, S. C., reported valuation figures for October more than 100 per cent above those of October 1927, but in each case the large percentage gain was due to small figures a year ago rather than to exceptionally large totals this year. Contracts awarded in October for construction work in the Fifth district, including both rural and urban projects, totaled $40,328,757, compared with $29,552,455 awarded in October 1927, accord ing to figures collected by the F. W. Dodge Corporation. Of the awards in October this year, $13,605,592 was for residential work. COTTON—In this Review last month we quoted the average spot cotton price on ten Southern markets on October 19th, when the price was 18.74 cents per pound. After that date the price sag ged to 18.16 cents on October 26th, but rose gradually during the first half of November, averaging 18.49 cents per pound on November 16th, the latest date for which figures are available. On the corresponding date last year the average price was 19.32 cents per pound. The Department of Agriculture’s fourth cotton condition report on the 1928 crop estimated this year’s probable yield at 14,133,000 bales, based on the November 1st condition. This compares with 13.993.000 bales indicated on October 1st, and final ginnings of 12,955,000 bales in 1927. The No vember 1st estimate showing an increase of 140,000 bales over the October 1st estimate did not ma terially affect cotton prices, being offset by higher domestic consumption and export figures for Oc tober 1928 than for October 1927. The Bureau of the Census ginning report to November 1st showed 10,160,997 bales ginned prior to that date this year, compared with 9,920,846 bales ginned to the same date in 1927 and 11,253,873 bales ginned before November 1st in 1926. Cotton consumption in American mills in October totaled 618,788 bales, according to the report of the Bureau of the Census made public on November 14th. This figure, which is the highest on record for any October, shows a decided increase over 492,221 bales consumed during the month of September this year, and is also above 613,520 bales consumed in October 1927. Total consumption during the three months of the present cotton year amounted to 1,637,738 bales, compared with 1,875,823 bales consumed during the three months ended October 31, 1927. Cotton on hand at manu facturing establishments on October 31st this year totaled 1,194,961 bales, compared with 719,981 bales held on September 30th this year and 1,323,703 bales held on October 31st last year. Bales in public warehouses and compresses numbered 4,635,981 at the end of October against 2,645,977 at the end of September, and 5,419,193 on October 31, 1927. Exports of cotton totaled 1,240,702 bales in October, compared with 814,569 bales sent abroad in September this year and 1,126,509 bales in October 1927. Imports last month totaled 27,840 bales, compared with 18,508 bales imported in September this year and 19,235 bales in October last year. Consumption of cotton in the growing states totaled 474,267 bales in October, compared with 449,297 bales used in October last year. Last month’s consumption in the cotton growing states amounted to 76.64 per cent of National consump tion, compared with 73.23 per cent of National consumption used in the cotton growing states in October last year. Of the 474,267 bales consumed in cotton growing states last month, Fifth re serve district states used 271,094 bales, or 57.16 per cent. The November 1st crop estimates for North and South Carolina and Virginia show further the disastrous effects of the September storms and floods. In its November 8th forecasts, the Depart ment of Agriculture estimated the North Carolina cotton crop for this year at 885,000 bales, a re duction of 40,000 bales from the October 1st estimate. South Carolina’s probable yield was given as 735.000 bales this year, a reduction of 85,000 bales under the October 1st figure. Virginia’s expected production of 43,000 bales shows a reduction of 2,000 bales from the October figure. The weather during the first half of November was very favorable for cotton picking, however, and it is possible that final ginning figures may slightly exceed the November 1st estimates. Apparently all three cotton growing states\ in the Fifth district will make slightly more cotton this year than they made in 1927, but on account of lower prices 'this year the 1928 crop promises to be less profitable. TOBACCO—SOUTH CAROLINA tobacco markets sold 8, 109,043 pounds of producers’ tobacco in October, practically cleaning up this year’s crop. With sales in August and September totaling 73>537fi 21 pounds, total production for the year is approximately 81,646,864 pounds, an increase of 5,067,497 pounds over 76,579,367 pounds sold in 1927. Prices for the 1928 crop were very unsatis factory, the larger crop this, year bringing to the growers approximately $5,000,000 less than the smaller crop of 1927. The average price this year was only $12.81 per hundred pounds, compared with $20.20 per hundred pounds realized for last year’s crop. NORTH CAROLINA markets sold 142,564,950 pounds of tobacco for growers in October 1928, compared with 133,620,441 pounds sold in October 1927. The average price advanced materially dur ing October in comparison with September, but was lower than the average for October last year. In 5 October this year the tobacco sold brought an average of $20.45 Per hundred pounds, compared with $15.05 per hundred in September 1928 and $22.81 per hundred in October 1927. Wilson led in October sales with 25,462,848 pounds, Greenville ranking second with 21,004,116 pounds and W inston-Salem third with 15,163,870 pounds. North Carolina’s total production of tobacco this year was forecast on November 1st as 464,750,000 pounds, compared with 468,000,000 pounds grown in 1927. The smaller crop this year, with lower prices, will make the 1928 crop considerably below the 1927 crop in cash value. V IR G IN IA tobacco markets opened in October, and sold 22,542,741 pounds of producers’ tobac co, compared with 26,034,387 pounds sold in October last year. The average price in October was $16.07 Per hundred pounds, compared with $19.26 realized in October 1927, but prices improved some what during the latter part of October and for the best grades were higher than last year. The qual ity of the tobacco sold in October was generally very poor, warehousemen estimating it as 18 per cent good, 35 per cent medium and 47 per cent common, compared with October 1927 figures of 31 per cent good, 36 per cent medium and 33 per cent common. Danville sold 10,390,321 pounds of tobacco last month and ranked first, South Boston ranking second with 4,854,780 pounds. All tobacco sold in October was flue-cured, or bright, tobacco. Virginia’s total crop this year is estimated at m ,852.000 pounds, compared with 127,971,000 pounds harvested in 1927. AGRICULTURAL NOTES—M ARYLAN D weather in October was favorable for outdoor farm operations and for growing crops. Wheat is up in most sections of the State and making good progress. Late truck and fruit crops were benefitted by the favorable weather conditions and sea sonal farm work is well advanced. The corn crop will total 19,929,000 bushels, in contrast to 22,660.000 bushels a year ago. Estimates on the potato crop indicate a smaller production than a year ago, the figures being 4,916,000 bushels in comparison with a crop of 5,246,000 bushels in 1927. Late blight has been discovered in the western part of the State and may cause some losses. The sweet potato crop is expected to total 1,470,000 bushels in comparison with 1,584,000 bushels in 1927, and this year’s tobacco crop at 19,840.000 pounds compares with 26,176,000 pounds a year ago. Most of the major crops in Maryland were effected unfavorably in one or more ways this year. The corn crop was reduced in yield and quality by heavy rains and storms during the growing period. Tobacco was similarly injured, yields being lowered and quality reduced. The potato crop faced unsatisfactory market conditions. The pack of canned goods in the State is probably below normal. Livestock producers and dairymen, however, have had little cause for complaint this season. V IR G IN IA farm work progressed seasonally during October, and by November 1st practically all crops had been harvested and most of the fall grain had been sown. Pastures were good and at the end of October were still furnishing good grazing. The corn crop was harvested later than usual, and growers were unable on November 1st to estimate the year’s yield with accuracy. Grow ers report only 72 per cent of the corn to be of merchantable quality, compared with 83 per cent last year. The total production is expected to be 41,760,000 bushels, compared with 47,967,000 bushels last year. The white potato crop was severely injured by the heavy rains of August and September, but the year’s estimated yield of 21,593,000 bushels is larger than 19,760,000 bushels dug in 1927. The sweet potato crop turned out fairly well, but the yield of 5,050,000 bushels was below 5,805,000 bushels harvested in 1927. Wet weather was also unfavorable for this crop. The apple crop turned out slightly better than was expected earlier in the season, the large size of the fruit raising the pro duction in bushels and barrels. The quality of the apple crop is reported to be better than last year, but not as good as in 1926. The commercial crop of 3,060,000 barrels is slightly more than double the 1,500,000 barrels harvested last year, but is less than 3,700,000 barrels gathered in 1926. The peanut crop showed a considerable range in yield, crops on light sandy soils turning out quite well while the yield on heavy clay soil was rather poor. The forecast of production is 127,680,000 pounds this year, compared with 116,128,000 pounds last year. NORTH CAROLINA experienced favorable weather for crop gathering in October, and no serious frost damage occurred prior to the middle of November except in western counties. The 1928 corn crop, forecast at 44,232,000 bushels, is the smallest for the State since 1909. The trouble was pri marily wet weather and storm damage since August. Last year’s production was 53,626,000 bushels, or 27 per cent more than this year’s crop. It appears likely that many farmers will have to purchase additional corn supplies this year, a situation further aggravated by the short hay crop. Sweet po tatoes are expected to yield about 7,680,000 bushels, compared with 10,146,000 bushels dug in 1927. Potatoes declined steadily after August 1st. The frequent changes from dry to wet weather was harmful, and reports of souring in the ground have been received. The white potato crop yielded 7>395>00° bushels, compared with 7,368,000 bushels in 1927. The peanut crop is considerably better than last year, and the quality appears to be good. Production of peanuts is forecast at 222,525,000 pounds, compared with 189,900,000 pounds harvested a year ago. This year’s hay crop is not yet cured, but is expected to be less than 845,000 tons cured in 1927. 6 WHOLESALE TRADE, OCTOBER 1928 Percentage increase in October 1928 sales, compared with sales in October 1927: 32 Groceries 10 Dry Goods 5 Shoes 15 Hardware 5 Furniture 18 Drugs 5.5 — 16.5 — 11.3 — 9.0 — 10.4 — 5.4 Percentage increase in October 1928 sales, compared with sales in September 1928: 6.9 — 6.7 — 9.0 11.4 — 5.7 11.0 Percentage increase in total sales since Jan. 1 , 1928 compared with sales in the first ten months of 1927: 1.3 — 19.6 — 6.8 — 13.4 — 22.2 — 3.7 Percentage increase in stock on October 31, 1928, compared with stock on October 31, 1927: .2(11*) — 7.2(4*) .7(4*) .2(8*) Percentage increase in stock on October 31, 1928, compared with stock on September 30, 1928: 10.3(11*) — 4.3(4*) — 10.2(4*) 2.4(8*) Percentage of collections in October to total accounts receivable on October 1, 1928: _____ 67.5(19^) 37.7(7*) 37.1(5*) 37.2(12*) 31.1(3*) 56.8(9*) — Denotes decreased percentage. * Number of reporting firms. Wholesale trade reports from 8o firms in 6 lines showed slightly larger sales in October than in October last year in groceries, but dry goods, shoe, hardware, furniture and drug sales decreased during the 1928 month. Dry goods showed the greatest decline, part of which was perhaps due to lower prices for some textiles this year. In comparison with sales in September this year, sales in October increased in groceries, hardware and drugs, but declined in dry goods, shoes and furniture. In total sales since January 1st this year, all lines except groceries show a falling off from aggregate sales during the first ten months of 1927. Stocks reported by the co-operating firms at the end of October were larger than stocks on hand on September 30, 1928, in groceries and hardware, but dry goods and shoe stocks declined during the month. On October 31, 1928, dry goods stocks were smaller than on October 31, 1927, but gro cery, shoe and hardware stocks were slightly larger. The percentage of outstanding receivables as of October 1, 1928, which were collected during the month was higher than the October 1927 percentage in groceries, dry goods, shoes and drugs, but collections in hardware and furniture were slower during the 1928 month. FIGURES ON RETAIL TRADE _ _ _ _ _ _ _ _ _ _ _ _ _ As Indicated By Reports from Thirty Representative Department Stores for the Month of October 1928_ _ _ _ _ _ _ _ _ _ _ _ _ Percentage increase in October 1928 sales, compared with sales in October 1927: Baltimore Richmond Washington Other Cities District — 4.8 5.0 9.1 — 4.8 1.5 Percentage increase in total sales since January 1st, over sales during the first ten months of 1927: — 1.5 3.4 3.7 — 6.0 .5 Percentage increase in October 1928 sales over average October sales during the three years 1923-1925, inc.: — 5.6 8.8 15.8 — 11.2 2.7 Percentage increase in stock on hand October 31, 1928, over stock on October 31, 1927: 1.7 — 6.4 — 5.7 — 3.9 — 2.6 Percentage increase in stock on hand October 31, 1928, over stock on September 30, 1928: 15.1 9.4 14.2 9.1 13.4 Percentage of sales in October 1928 to average stock carried during that month: 28.8 31.8 35.0 20.3 30.1 Percentage of total sales since January 1st to average stock carried during each of the ten elapsed months: 245.8 283.9 275.8 191.1 252.9 Percentage of collections in October 1928 to total accounts receivable on October 1st: 24.8 32.5 33.4 31.4 28.9 — Denotes decreased percentage. Retail sales in October in the Fifth reserve district, as reflected by sales of thirty leading de partment stores, increased approximately 30 per cent over September, and averaged 1.5 per cent above sales in October 1927. Reporting stores in Baltimore and the Other Cities averaged lower sales last month than in October a year ago, but the Richmond and Washington stores brought the district average above the 1927 level. Mild weather in October delayed retail trade to some extent. Cumulative sales since January 1st averaged one-half of 1 per cent above total sales in the first ten months of 1927, and October 1928 sales were 2.7 per cent above average October sales during the three years 1923-1925, inclusive. Stocks of goods on the shelves of the reporting stores rose seasonally last month with the re ceipt of winter and holiday merchandise, increasing 13.4 per cent during October, but on October 31st stocks averaged 2.6 per cent below those on hand on October 31, 1927. The rate of turnover increased seasonally in October. The percentage of sales in October to average stock carried that month was 30.1 per cent, and the percentage of total sales since January 1st to average stocks carried during each of the ten months was 252.9 per cent, indicating an annual rate of turnover of 3.03 times. Collections in October totaled 28.9 per cent of receivables outstanding on the first of the month, a higher figure than either 24.5 per cent attained in September 1928 or 27.8 per cent in October last year. (Compiled November 21, 1928) 7 BUSINESS CONDITIONS IN THE UNITED STATES (Compiled by the Federal Reserve Board) Industry continued activeT-in October and the distribution of commodities was in large volume. Wholesale commodity prices Reclined sharply owing chiefly to decreased prices of farm products. Member bank credit eased in October and November, while reserve bank credit outstand ing showed little chang^ ^Conditions in the money market were somewhat easier. PRODUCTION. Indasttfal production continued in October at the high level of September and considerably above the level | f a year ago. Output of minerals increased over September while the production of —manufaefr&reepi.ideclined slightly. Factory employment and payrolls increased to the highest level since early in idp7. The production of pig iron was particularly large in October and the first half of Noveil^WpTPftd the output of steel continued in record volume. Automobile produc tion declined considerably^in f)ctober after exceptional activity in September, and showed further re duction in November, 'as"Ts1 usual at this season. Activity increased in October in meat packing and in the textile indu&tlig^ with the exception of silk. Copper mining and smelting continued at a high level, and the output of coal and petroleum increased by more than the seasonal amount, while the production of zinc declined. There was also a decline in the output of lumber and building ma terials. Building contracts awarded continued to increase in October and were larger than in that month of any previous year, but declined sharply during the first two weeks of November. The in crease in October was due principally to large contracts for engineering and industrial projects. The November cotton crop estimate of the Department of Agriculture was slightly larger than the Oc tober estimate and indicated a yield of 14,133,000 bales, 1,178,000 more than the production of 1927. Ginnings of the current crop prior to November 14th totaled 11,320,302 bales, compared with 10,894,912 bales in the similar period of a year ago. Indicated yields of wheat, corn, oats, potatoes and tobacco were larger than the 1927 crops, while estimates of hay, rye and flax seed were smaller. TRADE, Department store sales in October were in about the same volume as in the same pe riod in the preceding year, but showed somewhat less than the seasonal increase from the high level of September. Inventories of these stores increased during the month, but continued smaller than a year ago. The volume of distribution at wholesale was larger than in September and showed a sub stantial gain over October 1927. Freight car loadings continued larger in October and November than a year ago, reflecting chiefly large loadings of miscellaneous freight. PRICES. Wholesale commodity prices declined in October after a continuous increase for three months, and the Bureau of Labor Statistics index for October, at 97.8 per cent of the 1926 average, was over 2 per cent below that for September. This decline reflected chiefly large decreases in prices of farm and food products and hides and leather. Prices of industrial commodities increased slightly, with small gains recorded in metals, building materials, chemicals and drugs. The principal increases occurred in prices of iron and steel, copper, and raw silk. During the first three weeks of November prices of cotton, pig iron, copper and petroleum increased, and prices of most farm and food products, except corn, pork and sugar, recovered somewhat after the October decline. BANK CREDIT. Between October 24th and November 21st there was a considerable increase in loans and investments of member banks in leading cities, but at the end of this period the total was still below the large volume outstanding at the middle of the year. Loans chiefly for commer cial purposes remained at a high level during the period and loans on securities showed further growth, reflecting a marked increase in the volume of loans to brokers and dealers in securities. Investments showed a further decline. During the four weeks ended November 21st there was little change in the volume of reserve bank credit in use. Reserve bank holdings of acceptances increased further and discounts for member banks declined. During the last week of October and the first three weeks of November conditions in the money market were somewhat easier; the rate on four to six months commercial paper declined from a level of 5 ^ per cent to a range of from 5% to 5^ per cent, and rates on call and time loans in the open market also declined slightly. 8
@FedFRASER