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MONTHLY REVIEW CREDIT, BUSINESS AND AGRICULTURAL CONDITIONS WILLIAM W. HOXTON, CHAIRMAN AND FEDERAL RESERVE AGENT FEDERAL RESERVE BANK OF RICHMOND RICHMOND, VIRGINIA NOVEMBER 30, 1932 H ERE were seasonal increases in October was about in line with in trade in some lines in Octo the record of other recent months, FIFTH FEDERAL RESERVE DISTRICT ber and the first half of Novem but was worse than the National * ber, and there were also evidences record for th at particular month. of improved basic conditions in the There was no improvement in em Fifth Federal reserve district. In ployment conditions in the district banking, developments indicated last month, but rather some sea sonal increase in the number of un that some money has returned to circulation from hoards. First, de employed. Coal production in mand deposits in reporting member creased seasonally in October, but was less than production in Octo banks increased between the mid dle of October and the middle of ber last year. In the textile field, November, in spite of a decline in mills continued operations on full day-light shifts, and this activity, loans during the same period. F ur with increased payrolls for textile ther, the actual circulation of Fed workers, has been reflected in im eral reserve notes of the Richmond proved trade in mill centers. Cot bank declined last month, while or dinarily circulation rises several millions of dollars ton prices were somewhat lower between midin late October and early November. Since other October and mid-November than in the preceding indicators show a seasonal expansion in trade, with month, but cotton consumption in the United a resultant need for more money with which to States in October exceeded consumption in Octo transact business, the increased deposits and de ber last year, and cotton exports also were larger creased circulation show that additional funds are than in 1931. Tobacco manufacturing declined in coming into trade channels from sources outside October in comparison with the same month a year the banks. Rediscounts for member banks at ago. Auction tobacco markets in the Fifth dis the Federal Reserve Bank of Richmond declined trict sold much less tobacco last month than they slightly last month, liquidation of agricultural sold in October last year, and this year’s prices, loans in country banks exceeding the needs for while somewhat higher than those of 1931, were commercial credit at city banks. Savings deposits low in view of the short crop of tobacco this y e a r; in mutual savings banks increased in October, and the continuation of low prices for tobacco being time deposits in reporting member banks remained due to the carry-over from the 1931 and earlier practically unchanged. Debits to individual ac crops. In the face of such a condition, it will re counts figures during four weeks ended November quire more than one short crop, or increased con 9 showed a seasonal decrease in comparison with sumption, to raise tobacco prices materially. debits in the preceding four weeks, ended October Retail trade as reflected in department store busi 12, but the decline was less than occurs in most ness increased in October over September, but by years. In comparison with debits in four weeks less than the seasonal amount. However, part of ended November 11 last year, debits in the cor this relatively small increase last month was due responding period this year were only 18 per cent to large sales in September. Wholesale trade in less, in spite of a lower level of general business October compared fairly well with trade in Oc activity this year, lower price levels in many lines, tober 1931, in view of many price changes during and the adverse influence of the new tax on checks. the year, and for the second successive month shoe The commercial failure record of the Fifth disrict jobbers reported larger sales than in the corre T MONTHLY REVIEW 2 sponding month of the preceding year. Crops for 1932 are practically made and harvested, and on the whole yields in the Fifth district were lower than yields in 1931, partly due to acreage reduc tion in some crops and drought conditions in the district during much of the growing season. Farm ers in many instances raised more feed and food stuffs than last year, and this year’s crops were made very cheaply, but total farm cash income promises to be even less this year than last, in spite of somewhat better prices for cotton, to bacco, and some other crops. Reserve Bank Statement ITEMS Nov. 15 1932 000 omitted Oct. 15 Nov. 15 1932 1931 Rediscounts held .................... $ 18,310 $ 20,251 $ 41,042 2,157 1,945 16,150 Open market paper------------47,133 47,133 27,406 Government securities ---------700 0 0 Other earning assets-----------67,388 69,541 85,298 Total earning assets---------Circulation of Fed. Res. notes.. 100,889 102,961 101,770 50,029 54,251 49,006 Members* reserve deposits-----86,607 99,216 93,727 Cash reserves_____________ 60.22 52.28 61.00 Reserve ratio -------------------- Rediscounts for member banks held by the Fed eral Reserve Bank of Richmond declined by $1,$942,000 between October IS and November 15, both this year, and the portfolio of open market paper declined by $212,000. Agricultural liquida tion slightly exceeded commercial borrowing at the member banks during the month, accounting for the decline in rediscounts at the reserve bank. There was no change in the bank’s holdings of Government securities last month, but the reduc tions in rediscounts and in open m arket paper low ered the total earning assets of the Richmond bank by $2,153,000. The most interesting change in the statement is in the volume of Federal reserve notes in circulation, a decrease of $2,072,000 occurring at a season when circulation is expected to in crease several millions of dollars. The decline probably indicates the return of money to trade channels from hoarding in sufficient amount to provide for increased needs for money on account of fall trade. Member bank reserve deposits de clined $1,023,000 between the middle of October and the middle of November, little more than a daily fluctuation. The several changes previously mentioned, with others of less importance, low ered the cash reserves of the Federal Reserve Bank of Richmond by $5,489,000 last month, and reduced the ratio of cash reserves to note and deposit lia bilities combined by a fraction of a point. A comparison of the November 15, 1932, figures in the statem ent of the Richmond reserve bank with those of November 15, 1931, shows the same material differences recorded in other recent months. Rediscounts for member banks held by the reserve bank decreased $22,732,000 during the year and the portfolio of open m arket paper de clined $14,205,000, but holdings of Government se curities rose $19,727,000. These changes resulted in a net increase of $17,910,000 in total earning assets during the year. The volume of Federal reserve notes in actual circulation decreased $881,000 between November 15 last year and this, No vember 15, 1932, being the first mid-month date in a year which showed lower circulation figures than the corresponding date of the preceding year. Since the fall of 1931 circulation has been excep tionally high as a result of hoarding, but it appears that during October and November much money was returned to circulation. Member bank reserve deposits decreased $5,245,000 during the year, due in part to lower deposits against which reserves are carried and in part to a reduction in the num ber of member banks. Cash reserves of the Fed eral Reserve Bank of Richmond rose $7,120,000 between November 15, 1931, and November 15, 1932, and the ratio of cash reserves to note and deposit liabilities combined rose 7.94 points. Member Bank Statement ITEMS Nov. 9 1932 000 omitted Oct. 12 Nov. 11 1932 1931 Loans on stocks and bonds (in cluding Governments) _____ $118,178 | $119,114 $144,155 All other loans------------------- 194,787 197,151 242,076 312,965 316,265 386,231 Total loans and discounts---Investments in stocks & bonds.. 273,902 267,990 238,068 37,234 32,444 35,757 Reserve bal. with F. R. Bank.... 17,551 Cash «i vaults_______ ____ 13,066 13,631 287,145 273,115 316,054 Demand deposits __________ 231,072 231,184 238,204 Time deposits_____________ 18,306 5,735 4,533 Borrowed from F. R. Bank...... The accompanying table shows the principal items of condition of forty-nine regularly report ing 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 fig ures in the table reflect conditions as of the report dates only, and are not necessarily the highest or lowest figures th at occurred during the interval between the dates. Total loans and discounts declined $3,300,000 be tween October 12 and November 9 this year, loans on securities decreasing $936,000 and all other loans dropping $2,364,000. On the other hand, the re porting banks increased their investments in stocks and bonds by $5,912,000 last month, and their ag gregate reserve balance at the reserve bank rose by $3,313,000. Cash in vaults rose $565,000 during the same period. Demand deposits increased $14,030,000 between October 12 and November 9, but time deposits decreased slightly, by $112,000. The forty-nine banks increased their borrowing at the Federal reserve bank by $1,202,000 during the month under review, and on November 9 sixteen of the number were rediscounting, the same num MONTHLY REVIEW ber as on October 12. During the year between November 11, 1931, and November 9, 1932, total loans in the reporting member banks decreased $73,266,000, of which $25,977,000 was in loans on securities and $47,289,000 was in all other loans. Investments in securities rose $35,834,000 during the year, but reserve balance with the reserve bank dropped $1,477,000, cash in vaults declined $3,920,000, and aggregate deposits decreased $36,041,000, demand deposits dropping $28,909,000 and time deposits $7,132,000. On November 9, 1932, aggregate bor rowings at the reserve bank by sixteen of the forty-nine reporting banks lacked $12,571,000 of equaling the amount borrowed by thirty of the same banks on November 11, 1931. Time and Shavings Deposits Time deposits in forty-nine reporting member banks and aggregate deposits in twelve mutual savings banks in Baltimore totaled $438,683,140 at the end of October 1932, a higher figure than $437,821,661 reported at the end of September this year, but materially less than the total of $451,914,081 at the end of October 1931. Savings deposits in creased in mutual savings banks last month, but time deposits declined slightly in reporting mem ber banks, the decline being due to the transfer of Christmas Savings funds from time to demand deposits early in November. Debits to Individual Accounts CITIES 000 omitted Total debits, four weeks ended Nov. 9, I Oct. 12, Nov. 11, 1932 ! 1932 1931 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, V a ._____ Roanoke, Va............. Spartanburg, S. C..... Washington, D. C. Wilmington, N. C, Winston-Salem, N. C. $ 6,740 243,313 9,553 25,009 31,871 10,948 4,778 5,090 17,820 12,203 10,983 4,942 9,054 11,074 5,688 30,364 2,739 14,617 104,905 17,652 5,345 164,967 6,651 21,887 $ 7,460 272,228 10,591 23,608 31,913 12,467 4,905 4,630 16,087 10,315 9,777 5,334 8,684 11,941 5,980 30,974 2,796 12,038 103,972 17,423 4,801 179,983 7,187 22,381 $ 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 Fifth District Totals $778,193 $817,475 $952,610 The debits to individual, firm and corporation accounts figures shown in the accompanying table for three equal periods of four weeks include all 3 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 $778,193,000 in debits reported for the four weeks ended Novem ber 9, 1932, with the total reported for the pre ceding four weeks, ended October 12 this year, shows a decrease of $39,282,000, or 4.8 per cent. A decline during the more recent period is seaj sonal, due to heavy payments of dividends and ! interest on October 1, but the decrease this year | was somewhat less than normally occurs. Ten of i the twenty-four cities reported higher figures for | the more recent four weeks, while last year only I five cities reported higher figures in a comparison | of the corresponding two periods. | In comparison with total debits reported for the j four weeks ended November 11, 1931, those re! ported for the corresponding period ended Novem ber 9, 1932, showed a decrease of $174,417,000, or 18.3 per cent. Every one of the tw enty-four re porting cities showed lower debits figures in the 1932 period than in the like period in 1931, due chiefly to lower price levels in many lines this year, to a generally lower level of business activity, and to the influence of the tax on checks which has materially lessened the use of checks in trade. Commercial Failures The commercial failure record in the Fifth Fed eral reserve district in October 1932 was worse than the record for the United States as a whole. Last month witnessed 119 insolvencies in the Fifth district, with aggregate liabilities totaling $1,933,670, compared with 150 insolvencies and lia bilities totaling $2,638,430 in*the shorter month of September this year and 92 insolvencies and $1,365,124 in liabilities in October 1931. The district therefore shows an increase of 29 per cent in num ber of failures and a rise of 42 per cent in liabilities involved in October 1932 in comparison with Oc tober 1931. On the other hand, there were 2,273 failures in the United States in October, with lia bilities totaling $52,869,974, compared with 2,362 failures and $70,660,436 in liabilities in October last year, decreases last month of 4 per cent in number of insolvencies and of 25 per cent in aggregate liabilities. In the United States, seven of the twelve reserve districts reported fewer failures in October 1932 than in October 1931, and nine of the twelve districts reported lower aggregate lia bilities. Employment Some seasonal additions to unemployment in October and early November probably more than offset additional work provided by a few industrial plants and mines in the Fifth district, and there fore the general situation is certainly no better and is probably somewhat worse than a month ago. The conditions of unemployed people of MONTHLY REVIEW 4 course becomes worse as their period of idleness lengthens, due to the consumption of savings and the accumulation of debts. Many of the Fifth dis trict’s industries are giving practically all their employees at least part time work, but there is relatively little construction work under way and both skilled and manual labor normally employed in building finds it almost impossible to obtain work of any sort. The problem of caring for the unemployed in the cities is further complicated by floaters and an influx of people from rural sec tions and smaller towns, people who come to the cities under the mistaken idea that work is more plentiful in them. Coal Production Bituminous coal production in the United States totaled 32,633,000 net tons in October 1932, a sea sonal increase over 26,314,000 tons mined in Sep tember this year but considerably short of the output of 35,700,000 tons in October 1931. Total production of soft coal during the calendar year to November 5 amounted to 249,727,000 net tons, comparded with 323,865,000 tons mined during the corresponding period last year. Shipments of coal through Hampton Roads in 1932 prior to Novem ber 6 totaled 13,993,318 tons, compared with 17,452,571 tons shipped through the same port to the corresponding date in 1931. In its October 22 report, the Bureau of Mines, Department of Commerce, gave bituminous coal production by States for the month of September. These figures credit W est Virginia with 7,429,000 net tons, while Pennsylvania, the second ranking state, mined only 6,302,000 tons. Textiles Fifth district textile mills held in October the gains made in operating time in August and Sep tember, and further increased consumption of cotton. The mill authorities contend, however, that their operations are showing either a small profit or no profit at all, but they are giving em ployment to their help and this has been reflected in better business for merchants in textile locali ties in the past three months. Fifth district mills consumed 242,038 bales of cotton in October, an increase of 2.7 per cent over 235,734 bales used in September this year and 9.4 per cent over 221,330 bales consumed in the district in October 1931. Last month North Carolina mills consumed 124,399 bales, South Carolina mills used 104,476 bales, and Virginia mills 13,163 bales. Consump tion of cotton in the Fifth district in October amounted to 48.19 per cent of National consump tion, a higher figure than either 47.95 per cent of National consumption used in the district in Sep tember this year or 48.01 per cent used in Oc tober 1931. Cotton Statistics Spot cotton prices ruled lower between the mid dle of October and the middle of November than during the preceding month, chiefly because the cotton crop of 1932 is turning out somewhat larger than early season condition figures indicated would be the case. In our Review last month we quoted the average price for middling grade short staple cotton on October 14 on ten leading Southern markets as 6.36 cents per pound. On October 21 the price was 6.09 cents, on October 28, 6.17 cents, November 4, 6.05 cents, November 11, 6.52 cents, and November 18, 6.15 cents, the last the latest date for which quotations are available. Condition figures on the 1932 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 11,947,000 bales, in compari son with the estimate of 11,425,000 bales on Oc tober 1, 1932, and 17,096,000 bales ginned in 1931. The November 1 report raised this year’s probable production figures for two of the three cotton growing states of the Fifth district, in comparison with the estimates made a month earlier. South Carolina’s yield is now estimated at 650,000 bales, compared with prospects for 610,000 bales on Oc tober 1 and 1,005,000 bales grown last year. North Carolina’s crop of 575,000 bales compares with an j estimate of 519,000 bales on October 1, and 756,000 ! bales ginned in 1931. Virginia’s prospective yield I of 28,000 bales compares with 29,000 bales pre! dieted a month earlier and 42,000 bales grown in I 1931. Total production in the Fifth district is fore j cast at 1,253,000 bales, an increase of 95,000 bales . during October but 550,000 bales less than last year’s production. The average number of pounds I per acre was much lower in the Fifth district this | year than in 1931, and in addition the acreage planted to cotton was less this year. Ginning figures to November 1, released by the Cen sus Bureau on November 9, showed 9,245,534 bales ginned from this year’s crop, compared with 12,124,295 bales of last year’s crop ginned before November. W eather during October was excellent for cotton picking. Cotton consumption in the United States in October showed an increase over the month of September, and was materially above consumption in October last year. The number of bales used totaled 502,244 in October 1932, compared with 491,655 bales used in September this year and 461,023 bales in Octo ber 1931. Total consumption this cotton year— August 1 through October 31—amounted to 1,396,500 bales, against 1,350,388 bales consumed in the corresponding three months of last season. Manufacturing establishments held 1,266,816 bales on October 31, compared with 1,087,286 bales held on September 30 and 1,108,034 bales on October 31, 1931. Public warehouses and compresses held 9,826,875 bales in storage at the end of October this year, compared with 7,969,280 bales so held a month earlier and 9,460,691 bales on October 31 last year. October exports totaled 1,008,023 bales, MONTHLY REVIEW compared with 733,665 bales exported in Septem ber and 1,014,180 bales sent abroad in October 1931. Total exports during the three months of the present cotton year—August 1-October 31, in clusive—totaled 2,193,842 bales, a higher figure than 1,783,402 bales shipped over seas during the corresponding three months last year. Spindles active at some time during October numbered 24,587,732, compared with 23,883,948 in September this year and 25,200,056 in October 1931. Cotton growing states consumed 414,572 bales of cotton in October, compared with 407,966 bales in September and 378,144 bales in October 1931. Last month’s consumption in the cotton growing states amounted to 82.54 per cent of National consump tion, compared with 82.98 per cent in September this year and 82.02 per cent in October 1931. Of the 414,572 bales of cotton consumed in the cotton growing states in October, the Fifth district mills used 242,038 bales, or 58.38 per cent, a lower figure than 58.53 per cent of Southern consumption at tained by Fifth district mills in October last year. Tobacco Manufacturing The output of tobacco products has declined in all recent months except cigarettes in August, and all figures for October are lower than figures for October 1931, according to stamp taxes paid to the Federal Treasury. Taxes paid on all tobacco products in October this year totaled $31,564,443, compared with $34,801,850 in October 1931. In actual quantity of production, cigarettes manufac tured dropped from 8,956,712,065 cigarettes in Oc tober 1931 to 8,351,667,453 cigarettes in October 1932, cigars dropped from 29,317,400 to 23,897,507, manufactured tobacco, for smoking and chewing, dropped from 30,496,706 pounds to 26,399,445 pounds, and snuff dropped from 3,642,354 pounds to 2,447,307 pounds. Tobacco Marketing South Carolina tobacco was all sold during August and September, and the auction markets were closed in October. Sales were larger than had been expected, and the forecast of production of tobacco in South Carolina this year was raised by the De partm ent of Agriculture from 32,640,000 pounds on October 1 to 39,232,000 pounds on November 1. Last year the yield of tobacco was 70,070,000 pounds. North Carolina markets sold 104,851,506 pounds of producers’ tobacco in October 1932, at an average price of $12.59 per hundred pounds. These figures compare with 125,498,567 pounds sold for an aver age of $9.93 per hundred in October 1931. Total sales this season to November 1 of 183,137,771 pounds show a decrease from 241,671,828 pounds sold in 1931 before November, and final production for 1932 estimated at 281,792,000 pounds is 41 per cent less than the yield of 479,526,000 pounds in 1931. Greenville led the North Carolina markets 5 in October sales with 15,659,378 pounds, but two markets at Ahoskie led in price with an average of $14.41 per hundred pounds. Wilson ranked sec ond in October sales with 15,365,747 pounds. Virginia leaf tobacco markets sold 7,826,210 pounds for growers in October, at an average price of $8.94 per hundred pounds. Last year the October sales amounted to 13,156,044 pounds at an average of $8.40 per hundred. October sales consisted en tirely of flue-cured types, as no fire-cured markets opened before November. Danville led all markets with total sales of 4,399,998 pounds, South Boston ranking second with 1,036,560 pounds. Lawrenceville paid the highest average price in October, $10.72 per hundred pounds. The quality of tobacco sold in Virginia in October was very poor, aver aging 15 per cent good, 36 per cent medium, and 49 per cent common. Last year October sales graded 17 per cent good, 33 per cent medium, and 50 per cent common. This year’s tobacco crop in Virginia is estimated at 53,641,000 pounds, com pared with the short crop of 97,920,000 pounds har vested in 1931. Agricultural Notes Maryland crops received good rains in October and early November, and pastures, early sown grains and late potatoes were helped, but the sowing of late grains was retarded and some potatoes rotted in sections where the harvest was not complete. Late cut hays were also damaged to some extent by the wet weather. The estimate of this year’s corn crop, 15,540,000 bushels, is about 25 per cent less than the 1931 yield of 20,710,000 bushels, but stocks of old corn on Maryland farms on Novem ber 1 totaled 969,000 bushels in comparison with only 76,000 bushels of old corn carried over last year. Average yields of Irish and sweet potatoes were lower this year than last. Total production of Irish potatoes is estimated at 3,298,000 bushels, compared with 3,360,000 bushels last year, and sweet potatoes this year total 1,200,000 bushels against 2,013,000 bushels dug in 1931. Maryland’s tobacco crop is estimated at 25,340,000 pounds this year, compared with 32,160,000 pounds cured last year and a ten-year average of 22,854,000 pounds. Fruit production is generally lower this year than last, and Maryland’s commercial apple crop is only 252,000 barrels against 650,000 barrels in 1931 and a ten-year average of 416,000 barrels. West Virginia crops suffered from dry weather dur ing a considerable part of the 1932 growing season. The yield of corn is forecast at 10,600,000 bushels, compared with 12,934,000 bushels harvested last year. The late Irish potato crop did not quite measure up to expectations, but this year’s total crop of potatoes amounted to 3,400,000 bushels compared with 3,200,000 bushels on approximately the same acreage in 1931. Tobacco yield in W est Virginia this year is only 2,691,000 pounds, com pared with 5,320,000 pounds harvested last year. Apples were benefited by rains in October, but on 6 MONTHLY REVIEW November 1 this year’s commercial crop in W est Virginia was estimated at only 693,000 barrels, compared with 1,700,000 barrels gathered in 1931. Virginia. Harvesting of corn, peanuts, apples and late hay, and the seeding of fall grains during Oc tober were delayed by frequent rains. The rains, however, broke the long drought and were of great benefit to pastures, fall grains, late truck crops and gardens. Some corn was destroyed by floods on creeks and rivers, and also corn and peanuts shocked in the fields suffered some loss. Produc tion of corn is forecast at 27,000,000 bushels, com pared with 43,061,000 bushels last year and a fiveyear average of 35,681,000 bushels. Approximately 8 per cent of the 1931 corn crop remained on farms on November 1, and in most sections of the State the carry-over of old corn with the new crop will provide sufficient feed for livestock during the win ter. Peanut digging was delayed by heavy rains during October, and very few peanuts had been threshed prior to November 1. Total production is forecast at 126,000,000 pounds, which is about 23 per cent less than last year’s crop of 164,160,000 pounds. The yield of late Irish potatoes was slightly better than had been expected, early Oc tober rains helping the crop. The average yield per acre was low, however, and the total potato crop of Virginia this year is 9,682,000 bushels, com pared with 14,278,000 bushels harvested last year. Sweet potatoes benefited from October rains, but this year’s yield was only 3,610,000 bushels com pared with 4,750,000 bushels dug last year. The commercial apple crop improved slightly during October and the estimated production is 1,740,000 barrels, compared with 3,500,000 barrels gathered in 1931. Many apples grew so rapidly during the October rains that they developed cracks, which made such fruit unfit for packing. Niorth Carolina crop yields were greatly reduced by hot, dry weather during the growing season, but October weather was favorable for harvesting of field crops with the exception of peanuts and hay. In spite of October rains, considerable fall plowing has been done. A corn crop of 35,520,000 bushels in North Carolina is indicated by the November 1 condition, compared with 48,072,000 bushels gath ered last year. Sweet potatoes were materially improved by October rains, and the forecast of 7,832,000 bushels made on November 1 is about 20 per cent above the 1931 yield of 6,560,000 bushels. The crop of sweet potatoes will probably be poor in keeping quality this year, due to the sappy na ture of the roots. Peanuts yielded better than had been expectd, and the nuts are good, although dis colored from wet weather conditions. The crop indicated on November 1 totaled 239,400,000 pounds, which is 22 per cent below last year’s yield of 305,900,000 pounds but about 21 per cent more than the five-year average. South Carolina crops improved during October, and on November 1 the composite condition figure for all crops was about 50 per cent higher than a month earlier. Compared with yields last year, prospects are for 44 per cent less tobacco this year, 35 per cent less cotton, 22 per cent less soybeans and 10 per cent less cowpeas, these decreases being due to reduced acreage in cotton and tobacco and to unfavorable weather during the growing season. On the other hand, this year’s sweet potato crop is 68 per cent larger than last year’s, hay shows an increased yield of 13 per cent, peanuts increased 8 per cent, and sorghum sirup increased 11 per cent. The increase in hay is due to larger acreage, and in sweet potatoes and peanuts to both acreage increase and better yields per acre. The South Carolina corn crop this year is forecast at 18,532,000 bushels, compared with 22,994,000 bushels in 1931, and this year’s hay yield of 202,000 tons compares with 178,000 tons cured last year. Sweet potatoes yielded 5,340,000 bushels this year, com pared with 3,180,000 bushels in 1931. The 1932 peanut crop of 9,800,000 pounds compares with last year’s yield of 9,100,000 pounds. Construction Building Permits Issued, Fifth District Cities, October 1932 and 1931 CITIES Permits Issued 1932 1931 Baltimore, Md.......... . 1,365 16 Cumberland, Md....... 17 Frederick, Md.......... 9 Hagerstown, Md. „.... 28 Salisbury, Md............ 8 Danville, Va............. 27 Lynchburg, Va.......... 109 Norfolk, Va............... 6 Petersburg, Va......... 28 Portsmouth, Va........ 85 Richmond, Va.......... . 28 Roanoke, Va............. 6 Bluefield, W. Va_ _ 37 Charleston, W. Va... 10 Clarksburg, W. Va... 26 Huntington, W. Va.... 10 Asheville, N. C.___ 42 Charlotte, N. C____ 15 Durham, N. C____ 37 Greensboro, N. C._ 9 High Point, N. C._ 6 Raleigh, N. C........... 4 Rocky Mount, N. C.. 5 Salisbury, N. C._ _ 14 Wilmington, N. C.__ 63 Winston-Salem, N. C. 50 Charleston, S. C.___ 46 Columbia, S. C____ 27 Greenville, S. C___ 8 Rock Hill, S. C___ 19 Spartanburg, S. C..... 611 Washington, D. G.... Totals __________ 2,771 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 Total Valuation 1932 1931 $1,995,960 $1,599,240 10,358 8,735 9,475 9,300 1,355 6,005 23t750 20,150 905 5,545 16,691 49,157 75,550 114,506 7,950 2,400 14,095 30,592 54,610 238,366 27,778 112,266 1,035 4,550 24,060 29,693 6,010 11,585 17,905 59,700 1,760 35,100 45,061 75,890 36,150 37,975 14,863 27,390 13,210 34,300 8,705 10,075 885 10,265 5,320 5,425 8,250 16,600 14,450 68,072 17,930 30,669 20,914 92,707 7,090 36,265 15,335 32,410 2,380 22,305 711,675 1,476,760 3,152 $3,211,466 $4,313.998 Construction work in the Fifth Federal reserve district continues far below normal, and is the out standing factor in the unemployment situation, as has been the case for more than a year. Building permits issued in October in thirty-tw o cities in the district totaled 2,771, in comparison with 3,152 MONTHLY REVIEW permits issued in October 1931, and the estimated valuation figures last month totaled only $3,211,466, a decrease of 25.6 per cent under the small total of $4,313,998 in October 1931. Only five of the thirty-tw o cities showed higher valuation fig ures for October 1932 than for October 1931, and several of the larger cities, including Richmond and Washington, reported much lower figures than for October last year. Contracts awarded in October for construction work in the Fifth district, including both urban and rural projects, totaled only $13,464,279, com pared with $23,342,082 in October 1931 and $25,569,298 in October 1930, according to figures col lected by the F. W. Dodge Corporation. Of the awards in October this year, $3,294,019, or 24.5 per cent, was for residential work, compared with $6,446,982, or 27.6 per cent, for this type of work in October 1931. Retail Trade, 33 Department Stores Richmond Baltimore Washington Other Cities District October 1932 sales, compared with sales in October 1931: —19.4 —19.9 —20.9 —21.4 —20.4 Jan.-October 1932 sales, compared with Jan.-October 1931: —20.3 —202 —16.1 —24.7 —19.0 Oct. 31, 1932, stocks, compared with stocks on Oct. 31, 1931: —17.6 —17.9 —14.2 —22.9 —17.1 Oct. 31, 1932, stocks, compared with stocks on Sept. 30, 1932: +16.1 +12.1 + 8.7 + 6.6 +10.6 Number of times stock was turned in October 1932: .341 .354 .371 .26 .349 Number of times stock was turned since January 1, 1932: 2.875 2.879 3.026 2.084 2.843 Percentage of Oct. 1, 1932, receivables collected in October 29.3 22.3 27.6 26.6 25.2 October department store sales usually exceed September sales by about 40 per cent, but this year the increase was only 20 per cent, partly because September sales were larger than usual in compar ison with other recent months and partly because October weather was too warm and clear to stimu late the purchase of fall merchandise. In compari son with last year’s sales, those of October 1932 show an average decline of 20.4 per cent in thirtythree department stores, and the first ten months of 1932 dropped 19.0 per cent below sales in the corresponding period of 1931. Stocks on the shelves of the reporting stores showed further seasonal increase in October, rising 10.6 per cent over stocks on September 30, 7 but on October 31 stocks were 17.1 per cent less in selling value than stocks on hand on October 31, 1931. Stocks were turned an average of .349 times in October, and since January 1, 1932, stocks have been turned 2.843 times, a lower figure than 3.041 times in the first ten months of 1931. Collections during October showed a seasonal increase over September collections but were slower than the average for October last year, 25.2 per cent of outstanding receivables being col lected last month in comparison with 21.6 per cent in September 1932 and 28.3 per cent in October 1931. Wholesale Trade, 62 Firms 22 9 Groceries Dry Goods 6 Shoes 13 Hardware 12 Drugs October 1932 sales, compared with sales in October 1931: —16.4 —12.3 +11.8 —12.1 —19.5 October 1932 sales, compared with sales in September 1932: — 6.6 — 7.1 —12.8 + .8 — 3.3 Jan.-Oct. 1932 sales, compared with Jan.-Oct. 1931 sales: —16.9 —22.4 —11.9 —20.4 —18.6 Oct. 31, 1932, stocks, compared with Oct. 31, 1931, stocks: — 6.0(8*) — 9.3(4*) -35.9(5*) —14.0(7*) Oct. 31, 1932, stocks, compared with Sept. 30, 1932, stocks: + 4.2(8*) + 1.6(4*) —12.0(5*) — 2.1(7*) Percentage of Oct. 1, 1932, receivables collected in October: 56.8(13*) 37.2(6*) 45.9(6*) 32.0(11*) 45.7(8*) —Denotes decreased percentage. *Number of reporting firms. Sixty-two wholesale firms in five lines reported on October business to the Bank. Sales in Oc tober in hardware were eight-tenths of 1 per cent larger than sales in September this year, but the other lines failed to register gains over the ear lier month. In comparison with sales in October 1931, sales last month were lower in every line except shoes, which for the second successive month exceeded sales in the same month of the preceding year. Total sales for the first ten months of 1932 were lower in all lines than sales in the corresponding period in 1931, shoes showing the smallest and dry goods the largest decline. Stocks on hand on October 31, 1932, showed slight increases in groceries and dry goods over stocks on hand on September 30, but the other lines reported stock reduction during October. On October 31, stocks in all lines were lower than stocks a year ago. Collections in every line showed seasonal im provement in October over September, but were slower in every line except in shoes than in Oc tober 1931. (Compiled November 21, 1932) MONTHLY REVIEW 8 BUSINESS CONDITIONS IN THE UNITED STATES (Compiled by the Federal Reserve Board) Volume of industrial output, after increasing con siderably during August and September, remained unchanged in October. Factory employment and payrolls reported for the middle of the month, showed a further increase. During October, as in the last three weeks of September, wholesale com modity prices declined, and in the first three weeks of November the general average was at the level of early summer. Production and Employment Industrial production, as measured by the Board’s seasonally adjusted index, continued in October at 66 per cent of the 1923-1925 average, as compared with a low level of 58 per cent in July. In the tex tile industries, which had shown a rapid expansion in August and September, there was a slight de crease in consumption of raw materials while out put of finished products increased somewhat. Shoe production, which also had increased substantially in recent months, showed a seasonal decline. Op erations at steel mills expanded from an average of 17 per cent of capacity in September to 19 per cent in October, contrary to seasonal tendency, and, ac cording to trade reports, continued at about this rate through the first three weeks of November. Production of automobiles in October declined fur ther to a new low level. At coal mines activity con tinued to increase rapidly until the middle of Oc tober, but since that time a reduction, largely sea sonal in character, has been reported. Employment in most manufacturing industries increased between the middle of September and the middle of October, and the Board’s seasonally ad justed index of factory employment showed an ad vance from 60 per cent of the 1923-1925 average to 61 per cent. At textile mills working forces in creased by considerably more than the usual sea sonal amount, and substantial increases were also reported at steel mills, lumber mills and carbuilding shops. In the canning and automobile indus tries there were decreases in employment. Value of construction contracts awarded, as re ported by the F. W. Dodge Corporation, continued at low levels during October and the first half of November. The Department of Agriculture estimate of the cotton crop, based on November 1 conditions, was 11,950,000 bales, about 525,000 bales larger than the estimate a month earlier. Distribution From September to October volume of freight traffic increased by more than the usual seasonal amount; after the middle of October carloadings declined, reflecting chiefly seasonal developments. Dollar value of department store sales increased by the usual amount in October. Wholesale Prices Wholesale commodity prices, as measured by the monthly index of Bureau of Labor Statistics, de clined from 65 per cent of the 1926 average in Sep tember to 64 per cent in October. Weekly figures show declines in the general average from early September through the first week in November, re flecting reductions in the prices of many domestic agricultural products and their manufactures, as well as in the prices of steel rails, copper, coffee, rubber, and silk. In the second week of November prices of many leading commodities, including grains, hogs, cotton, silk, zinc, lead, and tin ad vanced considerably, but later the prices of these commodities declined. Bank Credit Volume of reserve bank credit showed little change for the four-week period ending November 16. Member bank balances at the reserve banks increased further by $75,000,000, and in the middle of November were about $475,000,000 in excess of legal reserve requirements. This growth in re serve balances reflected an increase of $60,000,000 in the stock of gold and the issue of additional nat ional bank notes. Demand for currency showed lit tle change during the four-week period. Loans and investments of reporting member banks in leading cities, outside New York City and Chicago, declined further between the middle of October and the middle of November, reflecting a further reduction of loans at these banks. In New York City the investments of member banks increased by an amount larger than the decrease in loans, so that total loans and investments of these banks showed a further increase. Money rates in the open market continued at low levels during October and the first half of No vember. Rates on 90 - day bankers’ acceptances were unchanged at ^ of 1 per cent, and rates on prime commercial paper declined from a range of 1^4-2 to a range of lJ^-1^4 per cent.