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
CREDIT, BUSINESS AND AGRICULTURAL CONDITIONS

WILLIAM W. HOXTON,

C h a ir m a n a n d F e d e r a l R e s e r v e A g e n t

FEDERAL RESERVE BANK OF RICHMOND

RICHMOND, VIRGINIA
CTOBER and
first half of November are ex­
Olines of tradeshowtheaindustry over recent months, and
pected to
considerable increase in nearly
all
and

NOVEMBER 30, 1931

ginia continued to lead in bituminous coal production in
October, and showed somewhat less than the average
decline in tonnage. The textile industry in the Fifth
this year there was some increase, but it was less than district increased consumption of cotton in October by
occurs in most years. Three principal causes for the 13.2 per cent in comparison with consumption in Oc­
lag of business are widespread unemployment, low tober 1930, while the United States as a whole in­
financial returns from agricultural operations, and con­ creased only 4.2 per cent. In fact, the increase in con­
tinued mild weather, the first and second conditions sumption of cotton in October 1931 over October 1930
definitely lowering the purchasing power of the dis­ was greater in the Fifth district than in the United
trict and the third condition postponing the necessity States, New England states having used less cotton last
month. Spot cotton prices at the middle of November
for the purchase of fall clothing, fuel, etc.
were slightly higher than a month earlier, but were
In banking, October and early November witnessed about $20 per bale less than prices at mid-November
an increase of rediscounts at the Federal Reserve Bank last year. The Department of Agriculture forecasts
of Richmond of larger than normal proportions, and the 1931 cotton crop at 16,903,000 bales, the second
the circulation of Federal reserve notes also increased largest production on record, and yields in the Fifth
more than is customary during the period. Reporting district are in line with the average. Cotton acreage
member banks reduced their outstanding loans during was reduced in the district this year, and fertilizer was
the past month, and their deposits declined more than also used less extensively, but prospective yield is high­
is accounted for by the reduction in loans, necessitating er than last year on account of exceptionally favorable
further borrowing at the reserve bank. Savings bank weather and very small weevil damage. The manufac­
deposits in mutual savings banks increased moderately ture of tobacco has declined somewhat in recent months,
in October, but time deposits in regularly reporting but holds its own much better than most industries.
member banks declined materially. Debits to indi­ Marketing of leaf tobacco is under way in the Fifth
vidual accounts figures for four weeks ended Novem­ district, and good yields have been made, but prices
ber 11 not only showed a seasonal decrease in com­ paid the growers are the lowest in many years and for
parison with figures for the four weeks ended October low grades there is hardly any sale. Large yields of
14, but were 19 per cent less than aggregate debits in nearly all crops are being harvested in the Fifth dis­
the four weeks ended November 12, 1930. The sea­ trict this year, and in spite of disastrously low prices
sonal decline in debits last month was larger than oc­ for nearly everything they have to sell the farmers are
curs in most years. In comparison with the United probably better off than they were a year ago, pro­
States as a whole, the Fifth reserve district made a good duction of food and feed crops in large amounts this
record in business failures in October, experiencing year making them less dependent on cash crops. The
fewer failures and lower liabilities than in either Sep­ weather has been ideal for harvesting the year’s crops,
tember 1931 or October 1930, while the nation reported but winter grains have not had sufficient moisture for
11.2 per cent more insolvencies and 25.5 per cent larger germination and growth, and fall plowing is behind
liabilities last month than in October 1930. There was the usual schedule. Construction of residences and
no improvement in employment conditions in October industrial buildings continues at a very low level, but
and early November, but on the contrary the comple­ a considerable amount of public highway work and
tion of outdoor work undertaken during the summer other projects outside the cities is keeping contract
months tended to add to the ranks of the unemployed. award figures about up to the level of the past year
Coal production in October showed some seasonal in­ or two. Retail and wholesale trade in October felt the
crease over the output in September, but was much effects of unusually mild weather and consequently
lower than production in October last year. West Vir­ failed to show as large seasonal gains as in most years.




MONTHLY REVIEW

2

In fact, wholesale trade in October fell below the trade
of September in all lines for which information is
available except dry goods. Both retail and wholesale
trade in October fell materially below the volume of
business done in October 1930.

ernment securities this year, the cash reserves of the
Richmond reserve bank declined $9,622,000 between
November 15, 1930, and November 15, 1931, and the
ratio of cash reserves to note and deposit liabilities
combined declined 18.38 points during the same period.

Reserve Bank Statement

Member Bank Statement

ITEMS
Rediscounts held ---------------Open market paper------------Government securities ---------Other earning assets------------Total earning assets----------Circulation of Fed. Res. Notes..
Members’ reserve deposits-----Cash reserves -------------------Reserve ratio ....................... ....

000 omitted
Nov. 15 Oct. 15 Nov. 15
1931
1931
1930
$41,042
16,150
27,406
700
85,298
101,770
54,251
86,607
52.28

$32,157
33,056
21,558
700
87,471
93,119
59,443
82,853
50.48

$19,005
11,151
16,983
0
47*139
68,903
64,171
96,229
70.66

Although the volume of rediscounts for member
banks held by the Federal Reserve Bank of Richmond
increased $8,885,000 between October 15 and Novem­
ber 15, 1931, and holdings of Government securities
rose $5,848,000, a reduction of $16,906,000 in the port­
folio of open market paper lowered the Richmond
bank’s total earning assets by $2,173,000 during the
past month. Some increase in loans frequently occurs
at this season, but the rise this year was greater than
in most years. The circulation of Federal reserve
notes rose $8,651,000 between the middle of October
and the middle of November, a seasonal increase of
larger than normal proportion. Member bank reserve
deposits decreased $5,192,000 during the past month,
partly due to lower deposits in member banks against
which reserves must be carried and partly to a reduc­
tion in the number of member banks. The several
changes mentioned in the statement, with others of less
importance, raised the cash reserves of the Federal
Reserve Bank of Richmond by $3,754,000 between
October 15 and November 15, and also raised the ratio
of cash reserves to note and deposit liabilities com­
bined by 1.8 points.
A comparison of the November 15, 1931, figures
with those reported on November 15, 1930, shows a
marked increase in the use of reserve bank credit this
year. Rediscounts for member banks held by the
Federal Reserve Bank of Richmond rose $22,037,000
during the year, the rise occurring during the' past three
months. The Bank also increased its portfolio of open
market paper during the year by $4,999,000, and its
holdings of Government securities by $10,423,000.
Other earning assets rose $700,000, bringing the total
earning assets up $38,159,000 above the figure a year
ago. Federal reserve notes in actual circulation in­
creased $32,867,000 between the middle of November
1930 and the corresponding period in 1931, most of the
increase occurring in the past two months. Lower de­
posits in member banks and a reduction in the num­
ber of member banks reduced member bank reserve
deposits at the Federal Reserve Bank of Richmond by
$9,920,000 during the past year. Chiefly as a result of
increased investments in open market paper and Gov­




ITEMS

000 omitted
Nov. 11 Oct. 14 Nov. 12
1931
1931
1930

Loans on stocks and bonds (in­
cluding Governments _____ $144,155 $147,752 $174,372
All other loans________ ____
242,076 246,846 292,969
Total loans and discounts___ 386,231 394,598 467,341
Investments in stocks & bonds.. 238,068 242,325 188,809
Reserve Bal. with F. R. Bank.
38,861
37,234
37,786
Cash in vaults_____________
11,852
15,485
17,551
Demand deposits ______ ____
316,054 330,044 354,121
Time deposits _____________ 238,204 243,727 256,825
Borrowed from F. R. Bank._
_
12,494
6,465
18,306

The accompanying table shows the principal items
of condition of fifty regularly reporting member banks
in the Fifth reserve district as of three dates, thus
affording an opportunity for comparison of the latest
available figures with those of the corresponding 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 be­
tween the dates.
Total loans and discounts in the fifty reporting banks
declined $8,367,000 during the past month, loans on
stocks and bonds decreasing $3,597,000 and all other
loans declining $4,770,000. Total investments in bonds
and securities also decreased, by $4,257,000. Aggre­
gate reserve balances of the reporting banks at the
Federal Reserve Bank of Richmond decreased $552,000
between October 14 and November 11, but cash in
vaults rose by $2,066,000 during the same period. De­
posits in the reporting institutions dropped $19,513,000
during the past month, demand deposits declining $13,990,000 and time deposits $5,523,000. Part of the de­
cline in time deposits was due to transfers of Christmas
Savings funds from time to demand deposits on No­
vember 1. On November 11, the reporting banks were
borrowing $18,306,000 from the reserve bank, an in­
crease of $5,812,000 over the amount borrowed on
October 14 this year. Thirty of the fifty reporting
banks were rediscounting at the reserve bank on No­
vember 11, compared with twenty-one banks which
were borrowing on October 14.
Between November 12, 1930, and November 11,
1931, loans on stocks and bonds decreased $30,217,000
and all other loans dropped $50,893,000, a total re­
duction in loans of $81,110,000. On the other hand,
the fifty reporting banks increased investments in stocks
and bonds by $49,259,000 during the year, and cash in
vaults rose by $5,699,000. Deposits declined material­
ly since November 1930, demand deposits dropping
$38,067,000 and time deposits $18,621,000. Thirty of
the fifty reporting banks were borrowing $11,841,000
more from the Federal Reserve Bank of Richmond on

MONTHLY REVIEW
November 11, 1931, than sixteen banks were borrow­
ing on November 12, 1930.

Savings and Time Deposits
Aggregate deposits in twelve mutual savings banks
in Baltimore amounted to $213,710,081 at the close of
business October 31, 1931, a higher figure than either
$212,323,816 on September 30, 1931, or $198,704,801
on October 31, 1930. On the other hand, time deposits
in fifty regularly reporting member banks totaled only
$238,204,000 on November 11, 1931, a lower figure
than either $243,727,000 in time deposits on October
14, 1931, or $256,825,000 on November 12, 1930. A
considerable part of aggregate time deposits in report­
ing member banks does not represent genuine savings
accounts, and these deposits are therefore more likely
to fluctuate as conditions in the money markets and
business world change.

Debits to Individual Accounts
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.___
Winston-Salem, N. C.....
District Totals ____

000 omitted
Total debits, four weeks ended
Nov. 11,
Oct. 14,
Nov. 12,
1931
1931
1930
$

10,160
295,590
11,562
32,651
34,734
18,127
6,865
7,877
22,790
15,815
13,951
5,923
12,659
13,849
9,008
38,859
3,732
20,033
110,202
22,182
8,520
199,433
10,230
27,858

$ 952,610

$

11,069
368,880
15,233
33,338
38,771
17,064
8,368
6,707
24,538
16,090
12,701
7,720
14,759
16,016
9,617
41,793
4,128
17,542
123,366
22,513
7,868
226,119
10,441
33,587

$1,088,228

$

28,125
389,863
20,873
33,303
42,575
23,068
8,421
8,338
26,411
18,262
15,682
8,193
16,953
15,257
10,238
50,092
4,198
23,040
135,316
25,549
11,717
218,339
13,582
32,324

$1,179,719

The debits to individual, firm and corporation ac­
counts figures shown in the accompanying table for
three equal periods of four weeks include all checks
drawn against depositors' accounts in the banks of
twenty-four leading trade centers of the Fifth Federal
reserve district.
A comparison of the total of $952,610,000 in debits
reported for the four weeks ended November 11, 1931,
with the total reported for the preceding four weeks,
ended October 14 this year, shows a decrease of $135,618,000, or 12.5 per cent. A decline during the more
recent period is seasonal, due to heavy payments of
dividends and interest on October 1, but the decrease
this year was somewhat greater than normally occurs.




3

Only five of the twenty-four cities reported higher
figures for the more recent period, Danville, Va.,
Raleigh, N. C., and Columbia, Greenville and Spartan­
burg, S. C.
In comparison with total debits reported for the four
weeks ended November 12, 1930, those reported for the
corresponding period ended November 11,1931, showed
a decrease of $227,109,000, or 19.3 per cent. Every
one of the twenty-four reporting cities showed lower
debits figures in the 1931 period than in the like period
in 1930.

Commercial Failures
The commercial failure record in the Fifth Federal
reserve district in October 1931 was much better than
the record for the United States as a whole. Last
month witnessed 92 insolvencies in the Fifth district,
with aggregate liabilities totaling $1,365,124, compared
with 102 insolvencies and liabilities totaling $2,740,714
in the shorter month of September this year and 121
insolvencies and $1,430,900 in liabilities in October
1930. The district therefore shows a decrease of 24
per cent in number of failures and a decline of 4.6 per
cent in liabilities involved in October 1931, in com­
parison with October 1930. On the other hand, there
were 2,362 failures in the United States in October,
with liabilities totaling $70,660,436, compared with
2,124 failures and $56,296,577 in liabilities in October
last year, increases last month of 11.2 per cent in num­
ber of insolvencies and of 25.5 per cent in aggregate
liabilities.

Employment
There was no net increase in employment during the
past month in the Fifth reserve district. A few in­
dustrial plants added workers, but on the other hand
there was a further seasonal decline in outside work,
and fewer short time jobs were offered to idle people.
Unemployment appears to be most extensive among
workers in building trades and employees of relatively
small industrial plants, and there is also a large surplus
of clerical workers. In the Fifth district the tobacco
and textile industries are using their normal quotas of
employees, and most of the large employers of clerical
help have retained their forces, but smaller employers
in many instances have been unable to keep all em­
ployees. A few instances of stagger work have been
noted, and a wider use of this plan is being considered
by some corporations and political jurisdictions. All
authorities agree that there is little chance of material
improvement in employment conditions in the next two
or three months, and localities are making extensive
plans for relief of distress among idle workers.

Coal Production
Bituminous coal production in the United States
totaled 35,740,000 net tons in October 1931, a seasonal
increase over 31,919,000 tons mined in September this
year but considerably below the output of 44,150,000
tons in October 1930. Total production of soft coal
during the calendar year to November 7—approximate­

4

MONTHLY REVIEW

ly 264 working days—amounted to 325,404,000 net
tons, compared with 392,700,000 tons mined during the
corresponding period last year. Shipments of coal
through Hampton Roads in October totaled 1,791,610
tons, and total shipments since January 1 amounted to
17,054,318 tons.
In its October 24 report, the Bureau of Mines, De­
partment of Commerce, gave bituminous coal produc­
tion by States for the month of September. These
figures credit West Virginia with 9,096,000 net tons,
while Pennsylvania, the second ranking state, mined
only 7,530,000 tons.

Textiles

The textile industry in the Fifth district is in better
shape than in other section of the country, judged by
cotton consumption figures for the district, for South­
ern states, and for the United States. In October 1931,
cotton mills in North Carolina used 114,269 bales,
South Carolina mills used 96,226 bales, and Virginia
mills used 10,835 bales, a district total of 221,330 bales,
compared with 195,520 bales consumed in the same
states in October 1930, an increase last month of 13.2
per cent. In contrast, consumption in the cotton grow­
ing states as a whole increased only 7.7 per cent and
the United States gained only 4.2 per cent. Cotton
consumption in New England states decreased 11.7
per cent in October this year. Consumption of cotton
in the Fifth district in October amounted to 47.9 per
cent of National consumption, compared with 46.45 per
cent of National consumption used in the district in
September this year and 44.11 per cent in October
1930.

Cotton Statistics

Cotton prices turned upward in the second week in
October on ten leading Southern spot markets and ad­
vanced by November 6 to an average of 6.25 cents per
pound, but after that date the price declined again to
an average of 6.06 cents per pound for middling short
staple cotton on November 13, the latest date for
which official quotations are available. Farmers are
holding as much of their cotton as they can, hoping for
some further improvement in prices later on.
Condition figures on the 1931 cotton crop, based on
the November 1 condition of the crop, were issued by
the Department of Agriculture on November 9. This
report raised the estimate of production in the United
States to 16,903,000 bales, in comparison with the
estimate of 16,284,000 bales on October 1, 1931, and
final ginnings of 13,932,000 bales in 1930, The No­
vember 1 report raised this year's probable production
figures for all of the three cotton growing states of
the Fifth district, is comparison with estimates made a
month earlier. South Carolina's yield is now estimated
at 990,000 bales, compared with prospects for 929,000
bales on October 1 and 1,001,000 bales grown last year.
North Carolina's crop of 800,000 bales compares with
an estimate of 730,000 bales on October 1, and 775,000
bales ginned in 1930. Virginia's prospective yield of
42,000 bales compares with 39,000 bales predicted a
month earlier and 42,000 bales grown in 1930. Total
production in the Fifth district is forecast at 1,832,000




bales, an increase of 134,000 bales during October but
14,000 bales less than last year's production, the reduc­
tion being in South Carolina and due entirely to acreage
reduction. The average number of pounds per acre
was much higher in the Fifth district this year than in
1930.
Ginning figures to November 1, released by the
Census Bureau on November 9, showed 12,129,546
bales ginned from this year's crop, compared with 10,863,896 bales of last year's crop ginned before Novem­
ber. Weather during October was practically ideal for
cotton picking, and field loss of open cotton during the
month was less than in average years.
Cotton consumption in the United States in October
showed a decrease under the shorter month of Septem­
ber, but was materially above consumption in October
last year. The number of bales used totaled 462,025
in October 1931, compaied with 463,704 bales used in
September this year and 443,284 bales in October 1930.
Total consumption this cotton year—August 1 through
October 31—amounted to 1,351,548 bales, against
1,189,300 bales consumed in the corresponding three
months of last season. Manufacturing establishments
held 1,115,793 bales on October 31, compared with
775,523 bales held on September 30 and 1,354,574 bales
on October 31, 1930. Public warehouses and com­
presses held 9,449,987 bales in storage at the end of
October this year, compared with 6,296,546 bales so
held a month earlier and 7,474,299 bales on October
31 last year. October exports totaled 1,014,180 bales,
compared with 558,192 bales exported in September
and 1,004,120 bales sent abroad in October 1930. Total
exports during the three months of the present cotton
year—August 1-October 31, inclusive—totaled 1,783,402 bales, a lower figure than 2,273,112 bales shipped
over seas during the corresponding three months last
year. Spindles active at some time during October
numbered 25,188,112, compared with 25,236,916 in
September this year and 25,720,504 in October 1930.
Cotton growing states consumed 378,948 bales of
cotton in October, compared with 375,911 bales in
September and 351,849 bales in October 1930. Last
month's consumption in the cotton growing states
amounted to 82.02 per cent of National consumption, a
higher percentage than either 81.07 per cent in Septem­
ber this year or 79.37 per cent in October 1930. Of
the 378,948 bales of cotton consumed in the cotton
growing states in October, the Fifth district mills used
221,330 bales, or 58.41 per cent, a higher figure than
55.57 per cent of Southern consumption attained by
Fifth district mills in October last year.

Tobacco Manufacture
The output of tobacco products has declined in re­
cent months, and figures for the first three quarters of
1931 are lower than figures for the like period in 1930,
according to stamp taxes paid to the Federal Treasury.
Taxes paid on all tobacco products from January 1
through September 30 this year totaled $332,063,894,
compared with $342,737,534 in 1930. Taxes on ciga­
rettes totaled $268,080,693 this year, compared with
$276,204,080 in the corresponding period last year.

5

MONTHLY REVIEW
The Fifth reserve district states paid $236,533,687 in
taxes on cigarettes, against $241,714,513 last year.
Eighty-eight per cent of all cigarettes manufactured in
the United States between January 1 and September
30 this year were made in the Fifth district, all in
North Carolina and Virginia. North Carolina made
56.581.306.000 cigarettes since January 1, and Vir­
ginia made 22,245,923,000, a total of 78,827,229,000
cigarettes. If these were laid end to end, they would
reach 3,421,321 miles, or 136.8 times around the earth
at the Equator.

Tobacco Marketing
South Carolina tobacco markets sold only 9,502,206
pounds of growers' tobacco in October, at an average
price of $5.80 per hundred. Most of the markets
closed prior to October. Season sales in South Caro­
lina through October totaled 62,247,908 pounds for a
total of $5,799,993, compared with 70,947,349 pounds
sold before November 1 in 1930, for a total of $8,528,434. This year's forecast of production is 74,120,000
pounds, compared with the 1930 record crop of 96,250.000 pounds. The quality of this year’s crop is only
58 per cent of a theoretical base, compared with 70 per
cent last year.
North Carolina markets sold 125,498,567 pounds of
producers' tobacco in October 1931, at an average price
of $9.93 per hundred pounds. These figures compare
with 142,094,665 pounds sold for an average of $14.92
per hundred in October 1930, a decrease in cash re­
turns of approximately $8,738,500 for the month’s
sales. Total sales this season of 241,701,828 pounds
show a decrease from 274,053,083 pounds sold in 1930
before November 1, and final production for 1931 of
490.250.000 pounds is about 16 per cent less than the
yield of 584,000,000 pounds in 1930. Greenville led
the North Carolina markets in October sales with 18,536,026 pounds, and was second in price with $11.20
per hundred, but Washington led in price with an aver­
age of $11.40 per hundred pounds. Wilson ranked
second in October sales with 17,209,510 pounds.
Virginia leaf tobacco markets sold 12,195,651 pounds
of tobacco for growers in October, at an average price
of $8.50 per hundred pounds. Last year the October
sales amounted to 13,042,808 pounds at an average of
$11.07 per hundred. October sales consisted almost
entirely of flue-cured types, as only two fire-cured mar­
kets opened before November. Danville led all mar­
kets with total sales of 5,496,870 pounds, South Bos­
ton ranking second with 1,871,735 pounds. Petersburg
paid the highest average price in October, $9.93 per
hundred pounds. The quality of tobacco sold in Vir­
ginia in October was poor, averaging 17 per cent good,
33 per cent medium, and 50 per cent common, but was
better than the quality sold in October 1930, when the
grades were 11 per cent good, 28 per cent medium, and
61 per cent common. This year’s tobacco crop in Vir­
ginia is estimated at 112,935,000 pounds, compared
with the short crop of 111,776,000 pounds harvested
in 1930. The quality of this year’s crop is estimated
at 82 per cent, compared with the low average of 56
per cent last year.




Agricultural Notes
The weather in the Fifth Federal reserve district in
October and the first half of November was excellent
for all harvesting, but was too dry for fall plowing
and for winter grains. The lack of moisture also
caused some deterioration in quality, as in tobacco,
sweet potatoes and fruit. On the whole, Fifth district
states in the upper half of the district have much larger
yields than last year in nearly all crops, and the Carolinas also report larger per acre yields this year. How­
ever, since the Carolinas did not suffer severely from
last year’s drought, total production figures for 1931
in those states do not show nearly as large increases
as the states of Maryland, Virginia and West Virginia
report. In contrast to conditions in 1930, all food and
feed crops turned out well this year, and farmers are
therefore much less dependent upon their cash crops
than they were last year. It is fortunate that this con­
dition exists, prices for the products which the far­
mers sell being extremely low in nearly all cases. For
example, cotton is selling for about $30 a bale, of
which nearly a third is paid for picking and ginning.
Tobacco is selling at the lowest price for a number of
years. Fruit is so abundant that prices obtainable
make packing and shipment of lower grade fruit un­
profitable. On the whole, cash returns on 1931 farm­
ing operations are turning out so small that in many
instances expenses on this year’s work are not being
paid, leaving little or nothing with which to liquidate
debts carried over from 1930 as a result of crop failures
from the drought.
Building Permits Issued, Fifth District Cities, O
ctober 1931 and 1930.
CITIES
Baltimore, Md.........
Cumberland, Md.........
Frederick, Md............
Hagerstown, Md. —
Salisbury, Md........ —
Danville, Va..............
Lynchburg, Va. i----Norfolk, Va..............
Petersburg, Va.........
Portsmouth, Va.........
Richmond, Va............
Roanoke, Va. -------Bluefield, W. Va.......
Charleston, W. Va—
Clarksburg, W. Va—
Huntington, W. Va...
Asheville, N. C.-----Charlotte, N. C-----Durham, N. C.------Greensboro, N. C---High Point, N. C.......
Raleigh, N. C.-------Rocky Mount, N. C.....
Salisbury, N. C.-----Wilmington, N. C—
Winston-Salem, N. C
Charleston, S. C----Columbia, S. C-------Greenville, S. C.-----Rock Hill, S. C.........
Spartanburg, S. C---Washington, D. C.—
Totals ---------------

Permits
1931
1,525
15
9
14
27
6
30
160
4
36
130
51
7
37
28
21
37
79
20
37
21
15
11
3
21
76
34
64
27
15
27
565
3,152

Issued
Total Valuation
1930
1931
1930
1,505 $1,599,240 $1,941,360
8,735
12,935
18
9,300
19,999
15
6,005
48,370
36
20,150
42,350
34
5,545
22,395
20
49,157
111,200
56
126,554
114,506
167
2,400
17,590
7
30,592
36,075
37
238,366
405,696
148
481,245
112,266
44
4,550
14,645
13
29,693
735,125
53
11,585
17,925
33
59,700
20,001
23
35,100
19,445
40
75,890
93,921
87
37,975
77,750
16
27,390
52
83,710
34,300
16,340
13
10,075
9,313
17
10,265
15,906
11
5,425
2,560
10
16,600
35,700
19
68,072
66,883
105
30,669
213,485
60
92,707
32,780
70
36,265
29,385
46
32,410
12,280
10
22,305
12,943
29
1,476,760
2,191,665
611
3,405 $4,313,998 $6,967,531

MONTHLY REVIEW

6

Construction work in the Fifth Federal reserve dis­
trict continues far below normal, and is the outstand­
ing factor in the unemployment situation. Building
permits issued in October in thirty-two cities in the
district totaled 3,152, in comparison with 3,405 per­
mits issued in October 1930, and the estimated valu­
ation figures last month totaled only $4,313,998, a de­
crease of 38 per cent under the total of $6,967„531 in
October 1930. Ten of the thirty-two reporting cities
showed higher valuation figures for October 1931 than
for October 1930, but several of these increases were
due to very low figures last year rather than to a large
volume of work this year.
Contracts awarded in October for construction work
in the Fifth district, including both rural and urban
projects, totaled $23,342,082, compared with $25,569,298 awarded in October 1930 and $25,600,760 in Oc­
tober 1929, according to figures collected by the F. W.
Dodge Corporation. Of the awards in October this
year, $6,446,982 was for residential work, compared
with $4,805,083 for this type of work in 1930.

Retail Trade, 34 Department Stores

Richmond Baltimore Washington Other Cit District

October 1931 sales, compared with sales in October 1930:
—15.3
—14.6
— 5.6
—18.5
—11.6
Jan.-October 1931 sales, compared with Jan.-October 1930:
— 7.4
— 6.3
+ .03
—13.5
— 4.8
Oct. 31, 1931, stocks, compared’ with stocks on Oct. 31, 1930:
—11.1
—11.0
— 5.2
—15.7
— 9.6
Oct. 31, 1931, stocks, compared with stocks on Sept. 30, 1931:
+15.8
+ 7.5
+10.7
+ 3.8
+ 9.0
Number of times stock was turned in October 1931:
.348
.36
.406
.253
.362
Number of times stock was turned since January 1, 1931:
3.098
3.083
3.269
2.217
3.041
Percentage of Oct. 1, 1931, receivables collected in October:
30.1_______252_______3L8______ 292_______28.3

The weather in October was quite unfavorable for
retail trade, being too warm and clear for the sale of
fall merchandise, and as a result department store
sales did not increase as much over September sales
as in most years. October sales usually exceed Sep­
tember sales by about 40 per cent, but this year the
increase was only 26 per cent. In comparison with last
year's sales, those of October 1931 show an average
decline of 11.6 per cent in thirty-four department
stores, and the first nine months of 1931 dropped 4.8
per cent below sales in the first three-quarters of 1930.
Stocks on the shelves of the reporting stores showed
further seasonal increase in October, rising 9.0 per cent




over stocks on September 30, but on October 31 stocks
were 9.6 per cent less in selling value than stocks on
hand on October 31, 1930. Stocks were turned an
average of .362 times in October, and since January 1,
1931, stocks have been turned 3.041 times, a better
figure than 2.739 times in the first nine months of 1930.
Collections during October showed a seasonal in­
crease over September collections and were a little bet­
ter than the average for October last year, 28.3 per cent
of outstanding receivables being collected last month
in comparison with 24.6 per cent in September 1931
and 28.2 per cent in October 1930.

W holesale Trade, 64 Firms
23^

9

Groceries Dry Goods

6

Shoes

14

Hardware

12

Drugs

October 1931 sales, compared with sales in October 1930:
—22.8
—22.6
—18.3
—232
—13.7
October 1931 sales, compared with sales in September 1931:
— 6.0
+ 5.0
—21.8
— 3.2
— 3.3
Jan.-Oct. 1931 sales, compared with Jan.-Oct. 1930 sales:
—17.5
—22.1
— 7.5
—23.5
— 6.9
Oct. 31, 1931, stocks, compared with Oct. 31, 1930, stocks:
—21.5(8*) —29.2(4*) —22.0(5*) -43.6(7*)
Oct. 31, 1931, stocks, compared with Sept. 30, 1931, stocks:
+ .4(8*) — 8.3(4*) —12.0(5*) — 1.2(7*)
Percentage of Oct. 1, 1931, receivables collected in October:
63.6(14*) 38.1(6*)
40.2(6*)
34.0(11*) 54.0(8*)

Sixty-four wholesale firms in five lines reported on
October business to the Bank. Sales in October in
dry goods were 5.0 per cent larger than sales in Sep­
tember this year, but the other lines failed to make the
usual seasonal gain over the earlier month. In com­
parison with sales in October 1930, sales last month
were materially lower in every line, ranging from a de­
cline of 13.7 per cent in drugs to a decrease of 23.2
per cent in hardware. Total sales for the first nine
months of 1931 were lower in all lines than sales in
the corresponding period in 1930, drugs showing the
smallest and hardware the largest decline.
Stocks on hand on October 31, 1931, showed a very
slight increase in groceries over stocks on hand on
September 30, but the other lines reported stock re­
ductions during October. On October 31, stocks in
all lines were materially lower than stocks a year ago,
dry goods showing the largest decline, 29.2 per cent.
Collections in every line showed a seasonal improve­
ment in October over September, but were slower in
every line than in October 1930.

(Compiled November 21, 1931)

MONTHLY REVIEW

7

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

Production and employment in manufacturing in­
dustries declined further in October, while output of
minerals increased more than is usual at this season.
There was a considerable decrease in the demand for
reserve bank credit after the middle of October, re­
flecting a reduction in member bank reserve balances
and, in November, an inflow of gold, largely from
Japan. Conditions in the money market became some­
what easier.

Production and Employment
Total output of manufactures and minerals, as
measured by the Board’s seasonally adjusted index of
industrial production, declined from 76 per cent of
the 1923-1925 average in September to 74 per cent
in October. Output of steel remained unchanged at
28 per cent of capacity in October, although it usually
shows an increase for that month; in the first half of
November activity at steel mills increased somewhat.
Automobile production declined sharply in October;
production of shoes and woolens decreased and cotton
mill activity showed little change, although an increase
is usual at this season. Output of bituminous coal in­
creased seasonally, and there were large increases in
the output of anthracite and petroleum.
Volume of factory employment declined substan­
tially from the middle of September to the middle of
October. At woolen mills where an increase in em­
ployment is usual at this season, there was a large de­
crease. In the automobile and shoe industries reduc­
tions in employment were considerably larger than
usual, while in the canning industry the decline was
wholly of a seasonal character. In the silk goods and
hosiery industries employment increased by more than
the usual seasonal amount.
The November cotton crop estimate of the Depart­
ment of Agriculture was 16,903,000 bales, 600,000
bales larger than the October estimate and 3,000,000
bales larger than last year in spite of a reduction in
acreage.
Data on the value of building contracts awarded in
the period between September 1 and November 15, as
reported by the F. W. Dodge Corporation, showed a
continuation of the downward movement. In this
period value of contracts was 29 per cent smaller than
in the corresponding period of 1930, reflecting smaller
volume of construction and somewhat lower building
costs.




Distribution
Total volume of freight-car loadings remained un­
changed in October, while loadings <of merchandise
decreased. Department store sales increased by some­
what more than the usual seasonal amount.

W holesale Prices
The general level of wholesale prices declined from
69.1 per cent of the 1926 average in September to
68.4 per cent in October, according to the Bureau of
Labor Statistics. Prices of grains, cotton, and silver,
after showing a rapid rise beginning early in October,
declined considerably, but in the third week of No­
vember were still above their October low points;
prices of hides and petroleum were also higher in the
middle of November than in early October. During
this period the prices of livestock and meats declined
rapidly, reflecting in part developments of a seasonal
character.

Bank Credit
Reserve bank credit, which had increased rapidly
between the middle of September and the third week
of October, declined by $265,000,000 during the fol­
lowing four weeks. This decline reflected a large re­
duction in member bank and other balances at the
reserve banks and also an inflow of gold, chiefly from
Japan. Demand for currency, which had been on a
large scale during September and the first three weeks
of October, showed relatively small fluctuations after
that time and in the second week of November de­
clined by somewhat more than the seasonal amount.
Loans and investments of member banks in leading
cities continued to decline during recent weeks, and
on November 18 the total volume was $500,000,000
smaller than five weeks earlier. This decrease re­
flected substantial reductions in loans on securities and
in other loans, as well as in the banks' holdings of in­
vestments. At the same time deposits of these banks
also declined with a consequent reduction in the reserve
balances which they were required to hold with the
reserve banks.
Money rates in the open market, which had ad­
vanced sharply during October, declined somewhat
early in November. Rates on prime commercial paper
declined from a range of 4-4^4 per cent to a range of
3M“4 per cent, and rates on bankers’ acceptances from
3}i to 2% per cent.

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