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MONTHLY REVIEW CREDIT, BUSINESS AND AGRICULTURAL CONDITIONS WILLIAM W. HOXTON, Chairman and F ederal Reserve Agent FEDERAL RESERVE BANK OF RICHMOND RICHMOND, VIRGINIA trade begins in est in September, many lines FALLbusinessusually andseasonalearn of take a up OCTOBER 31, 1932 A turn. This seasonal rise in business volume occurred in the Fifth Federal reserve district last month, and in a few lines was in larger volume than seasonal influence alone would explain. In banking, the developments in Sep tember and early October were mostly of an unseasonal nature, among them being a decline in rediscounts for member banks at the Federal reserve bank, a decline in outstanding loans in reporting member banks located in leading cities, a slight decrease in the circulation of Federal reserve notes, and practically no net change in deposits in member banks in spite of a reduction in loans. Time deposits in both member banks and in mutual savings banks in creased in September. Debits to individual accounts figures in twenty-four leading cities in the four weeks ended October 12, 1932, totaled 19.3 per cent more than debits in the preceding four weeks, ended Sep tember 14, an increase only partly due to seasonal in fluences. Every one of the twenty-four cities reported higher figures for the later period. Commercial fail ures in September in the Fifth district compared favor ably in both number and in aggregate liabilities in volved with the record of other recent months, and last month’s liabilities were less than those of September 1931. Employment showed some seasonal changes last month, but there was no material net increase or decrease in the number of employed persons in the district. Textile payrolls were increased during Sep tember, chiefly by increase in the number of days per week the mills are now running. Practically all mills are on full daylight time in the latter part of October, and cotton consumption in September increased more than seasonally. Coal production increased in Septem ber, as usual, and by about the usual amount. Spot cotton prices declined further between the middle of September and the middle of October, influenced ad versely by the Department of Agriculture’s increase in its estimate of probable production, made on October 8. Cotton consump tion and cotton exports increased nota bly in September, and average hours of operation per spindle in the United States rose from 175 in August to 218 in September. Auction tobacco mar kets in the Carolinas sold much less tobacco than in September 1931, but the tobacco sold brought better prices than those of last year. Agricultural prospects on the whole declined con siderably during September because of dry weather, some sections experienc ing drought conditions almost as se vere as those of 1930. The drought was not as extensive this year, how ever, and also developed later in the growing season, and therefore did much less damage than the record drought of 1930. Construction work provided for in building permits issued and contracts actually awarded last month was in very small volume, as in all other recent months. Retail trade as reflected in sales in thirty-three leading department stores in the Fifth district increased more than seasonally last month, and averaged only 10.8 per cent less than sales in Septem ber 1931, while cumulative sales in the first nine months of this year averaged 18.8 per cent below sales in the corresponding period last year. Wholesale trade re ports in five leading lines also showed seasonally in creased sales in September, and shoe sales were ahead of sales in September last year, this being the first line to report in ten months an increase in comparison with the corresponding month of the preceding year. FIFTH FEDERAL RESERVE DISTRICT Reserve Bank Statement Rediscounts for member banks by the Federal Re serve Bank of Richmond declined by $3,304,000 be tween September 15 and October 15, both this year, in keeping with a seasonal trend. At this time of year liquidation of agricultural indebtedness normally ex ceeds mercantile borrowing, but this year the decline in rediscounts was almost entirely in city bank borrow- MONTHLY REVIEW 2 ITEMS 000 omitted Oct. 15 Sept. 15 Oct 15 1932 1931 1932 Rediscounts held_....................._ $ 20,251 $ 23,555 2,495 2,157 Open market paper.------------47,133 47,133 Government securities............... 0 0 Other earning assets-----------73,183 69,541 Total earning assets----------Circulation of Fed. Res. notes.. 102,961 104,740 49,007 50,029 Members* reserve deposits-----96,417 99,216 Cash reserves--------------------59.95 61.00 Reserve ratio--------------------- $ 32,157 33,056 21,558 700 87,471 93,119 59,443 82,853 50.48 ing instead of in country banks in which most of the agricultural loans are held. During the past month the Richmond bank also decreased nominally its holdings of open market paper, but the portfolio of Government securities remained unchanged. These changes de creased the Bank’s total earning assets by $3,642,000 between September 15 and October 15. The volume of Federal reserve notes in actual circulation registered an unseasonal decrease of $1,779,000 last month, but this decline was due to the return of notes which had been drawn out by the banks in one of the larger cities as a safety fund during early September. The tension having eased, the notes were returned to the reserve bank for retirement. Member bank reserve deposits rose by $1,022,000. The several changes mentioned, with others of less importance, raised the cash reserves of the Federal Reserve Bank of Richmond by $2,799.000 between September 15 and October 15, and also raised the ratio of cash reserves to note and de posit liabilities combined by 1.05 points. A comparison of the figures on the statement for October 15, 1932, with corresponding figures reported on October 15, 1931, shows marked changes in most items. Rediscounts for member banks declined $11,906.000 during the year, a decrease of 37 per cent, but the size of the decline was due to an unusual rise in rediscounts which occurred between September 15 and October 15 last year. The Bank also decreased its portfolio of open market paper by $30,899,000 during the year, but increased its holding of Government se curities by $25,575,000. These transactions, with a drop of $700,000 in other earning assets, lowered the total earning assets of the Federal Reserve Bank of Richmond by $17,930,000 between October 15, 1931, and October 15, 1932. The circulation of Federal reserve notes at the middle of October this year showed an increase of $9,842,000 in comparison with the cir culation on the corresponding date a year ago, partly due to hoarding and partly to the influence of the check tax which has increased the use of money and reduced the volume of checks. Member bank reserve deposits decreased by $9,414,000 during the year, partly due to lower deposits in member banks and partly to a reduction in the number of member banks. The changes in the statement resulted in an increase in cash reserves of the Richmond bank during the year totaling $16,363,000, and the ratio of reserves to note and deposit liabilities combined rose by 10.52 points. Member Bank Statement ITEMS 000 omitted Oct. 12 Sept 14 Oct. 14 1932 1931 1932 Loans on stocks and bonds (in cluding Governments)_____ $119,114 $120,458 All other loans_____________ 197,151 198,448 Total loans and discounts__ 316,265 318,906 Investments in stocks and bonds 267,990 251,683 32,562 Reserve bal. with F. R. Bank.. 32,444 Cash in vaults_____________ 13,189 13,066 Demand deposits___________ 273,115 276,147 Time deposits______________ 231,184 228,413 Borrowed from F. R. Bank__ 7,786 4,533 $147,752 246,846 394,598 242,325 37,786 15,485 330,044 243,727 12,494 The accompanying table shows the principal items of condition of forty-nine member banks in twelve leading cities of the Fifth Federal reserve district as of three dates, October 12, 1932, September 14, 1932, and October 14, 1931, 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 on the report dates only, and are not necessarily the highest or lowest figures that oc curred during the interval between the dates. Total loans and discounts in the reporting banks decreased by $2,641,000 during the past month, con trary to seasonal trend in city banks. Loans on stocks and bonds declined $1,344,000, while all other loans decreased $1,297,000. On the other hand, investments in bonds and securities rose in the reporting banks by $16,307,000 between the middle of September and the middle of October. Cash in vaults declined by $123,000 and reserve balance with the reserve bank dropped $118,000, both mere daily fluctuations. Between Sep tember 14 and October 12, there was a small net de| cline in deposits, demand deposits decreasing $3,032,j 000 while time deposits rose $2,771,000. The fortyI nine reporting banks decreased their borrowing at the | Federal Reserve Bank of Richmond by $3,253,000 durj ing the month under review, and on October 12 only j sixteen of the forty-nine banks were rediscounting, j compared with nineteen of the same banks which were | borrowing at the reserve bank a month earlier. j In comparison with figures reported last year, those , for October 12, 1932, show marked changes in most | items. Total loans and discounts at the reporting I banks dropped $78,333,000 between October 14, 1931, j and October 12, 1932, loans on stocks and bonds dej dining $28,638,000 and all other loans decreasing ! $49,695,000. On the other hand, investments in stocks and bonds rose by $25,665,000 during the year. Cash in vaults decreased by $2,419,000 since mid-October last year, chiefly because easier conditions in the banks relieved the necessity for carrying large sums in their vaults as a precautionary measure. Deposits declined materially during the period under review, demand deposits decreasing $56,929,000 and time deposits drop ping $12,543,000, but the decrease in deposits was less than the decline in total loans. As a result of lower deposits, reserve balances of the reporting banks de clined $5,342,000 between the middle of October last MONTHLY REVIEW year and this. On October 12, 1932, sixteen of the reporting banks were borrowing $4,533,000 from the Federal Reserve Bank of Richmond, a decrease of $7,961,000 under total borrowings by twenty-one of the same banks on October 14, 1931. Time and Savings Deposits Time deposits in forty-nine reporting member banks and aggregate deposits in twelve mutual savings banks in Baltimore totaled $437,821,661 at the end of Sep tember 1932, a higher figure than $434,776,728 re ported at the end of August this year, but materially less than the total of $456,050,816 at the end of Sep tember 1931. Deposits increased slightly during the past month in both the reporting member banks and in the mutual savings banks. 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, 'jN. 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. 000 omitted Total debits, four weeks ended Sept. 14, Oct. 14, Oct. 12, 1932 1932 1931 $ 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 $ 6,790 226,943 9,292 21,731 30,779 10,839 4,317 3,635 13,589 8,613 7,935 4,394 8,192 9,525 5,185 26,097 2,517 9,677 84,508 14,279 4,459 147,710 6,052 18,201 $ 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 3 In comparison with figures reported for four weeks last year, ended October 14, 1931, corresponding fig ures for the four weeks ended October 12, 1932, show a total decrease of $270,753,000, or 24.9 per cent. All of the reporting cities showed lower figures for the 1932 period. The decrease in 1932 debits is due to several causes, among them being a generally lower level of business activity, lower prices in many lines this year, and the influence of the new tax on checks which has materially reduced the use of checks and thereby lowered debits to individual accounts. Commercial Failures Business failures in the Fifth Federal reserve dis trict in September 1932 numbered 150, with aggregate liabilities totaling $2,638,430, compared with 171 fail ures and liabilities totaling $3,892,210 in August 1932 and 102 failures and $2,740,714 in liabilities reported in September 1931. Last month’s failures were the fewest in number for any month this year except April, and last month’s liabilities were lower than for any other months except May and January. Bankruptcies in the United States numbered 2,182 in September 1932, with liabilities aggregating $56,127,634, com pared with 1,936 failures and liabilities totaling $47,255,650 in September 1931. The Fifth district showed an increase of 47 per cent in number of failures in September 1932 in comparison with the number in September last year, while the United States reported an increase of only 13 per cent, but in the aggregate of liabilities involved in September 1932 bankruptcies the district showed a decrease of 3.7 per cent, while the United States as a whole increased 18.8 per cent. Employment There were no material changes in employment con ditions in the Fifth district during the past month. Textile mills increased operations and either took on additional workers or gave longer working hours to persons already employed, and there was also some seasonal rise in employment in coal mining, but the approach of cold weather brought further unemploy ment, of a seasonal nature, in construction work as $1,088,228 summer projects were completed. Fall trade during Fifth District Totals $ 817,475 $ 685,259 the next two months will require temporary help in many mercantile establishments, but on the other hand The accompanying table shows debits to individual, firm and corporation accounts in clearing house banks winter weather will increase the hardships of unem in the leading cities of the Fifth Federal reserve dis ployment and will cause a rise in the assistance which organizations and trict for three equal periods of four weeks each, ended charitableupon to furnish. governmental agencies will be called October 12 and September 14, 1932, and October 14, 1931. During the four weeks ended October 12, 1932, ag gregate debits to individual accounts showed a seasonal increase of $132,216,000, or 19.3 per cent, over debits during the preceding like period this year, ended Sep tember 14, the increase being due to quarterly settle ments on October 1 and to the opening of early fall trade during the later period. All of the twenty-four reporting cities showed higher figures for the more recent period. Coal Production There was a seasonal increase in the production of bituminous coal in September, and 26,266,000 net tons were mined, compared with 22,489,000 tons dug in August this year and 31,919,000 tons in September 1931. Total production of soft coal in the United States in the present calendar year to October 8 amounted to 219,214,000 net tons, compared with 291,867,000 tons mined during the corresponding period 4 MONTHLY REVIEW last year, and 404,477,000 tons in 1929, before the de pression began. In its September 24 report, the Bureau of Mines, Department of Commerce, gave bituminous coal pro duction figures for the month of August, and West Virginia with 6,807,000 tons continued to lead the country, Pennsylvania ranking second with 5,778,000 tons. Nearly all retail coal yards have raised coal prices from summer levels, but in many cases the increase was somewhat less than occurs in most years. All sizes of coal are in stock in sufficient quantity to fill orders immediately. bales on September 1, and 756,000 bales ginned in 1931. Virginia's prospective yield of 29,000 bales compares unfavorably with 30,000 bales predicted a month earlier and 42,000 bales grown in 1931. Total production in the Fifth district is forecast at 1,158,000 bales, an increase of 15,000 bales during September but 645,000 bales less than last year. Ginning figures to October 1, released by the Cen sus Bureau on October 8, showed 4,835,465 bales gin ned from this year's crop, compared with 5,409,657 bales of last year's crop ginned before October. On the whole, cotton opened earlier this year than in 1931, and a larger percentage of the crop was ginned prior to October 1. Textiles Cotton consumption in the United States in Sep Textile mills in the Fifth district continued to ex tember 1932 showed more than a seasonal increase over pand their operations in September under the stimulus consumption in the longer month of August, and was of a smaller cotton crop this year, and practically all materially larger than in September last year. The mills are now running full time on a daylight basis, number of bales used totaled 491,655 in September with scattered mills also working night shifts. Fifth 1932, compared with 402,601 bales used in August district mills consumed 235,734 bales of cotton in Sep this year and 464,335 bales in September 1931. Total tember, an increase of 27 per cent over 185,548 bales consumption this cotton year—August 1 through Sep used in August this year and 9.4 per cent over 215,410 tember 30—amounted to 894,256 bales, against 889,bales consumed in the district in September 1931. Last 365 bales consumed in the corresponding two months month North Carolina mills consumed 119,083 bales, of last season. Manufacturing establishments held 1,South Carolina mills used 103,487 bales, and Virginia 087,286 bales on September 30, compared with 1,090,mills 13,164 bales. Consumption of cotton in the Fifth 421 bales held on August 31 and 777,858 bales on Sep district in September amounted to 47.97 per cent of tember 30, 1931. Public warehouses and compresses National consumption, compared with 46.09 per cent held 7,969,280 bales in storage at the end of September of National consumption used in the district in August this year, compared with 6,547,563 bales so held a month earlier and 6,298,408 bales on September 30 this year and 46.39 per cent in September 1931. last year. September exports totaled 733,665 bales, compared with 452,154 bales exported in August and Cotton Statistics 558,192 bales sent abroad in September 1931. Total Spot cotton prices in late September and the first exports during the two months of the present cotton half of October ruled lower than in the preceding year—August 1-September 30, inclusive—totaled 1,month. On September 16, the average price of % 185,819 bales, a substantial increase over 769,222 bales inch staple, middling grade, upland cotton on ten lead shipped over seas during the corresponding two months ing Southern spot markets was 6.83 cents per pound, last year. Spindles active at some time during Sep and on September 23 and 30 the average was 7.07 tember numbered 23,883,948, compared with 22,022,cents. In the first week of October the price dropped 490 in August this year and 25,230,618 in September to 6.86 cents on the 7th, and still further to 6.36 cents 1931. on October 14, the latest date for which figures are Cotton growing states consumed 407,966 bales in available. The latest decline was the result of the September, compared with 338,170 bales in August Department of Agriculture's condition report of Oc and 377,531 bales in September 1931. Last month's tober 8, which increased the earlier estimate of prob consumption in the cotton growing states amounted to able cotton production this year. 82.98 per cent of National consumption, a lower per Condition figures on the 1932 cotton crop, based on centage than 84.00 per cent in August this year but the October 1 condition, were issued by the Depart higher than 81.31 per cent in September 1931. Of ment of Agriculture on October 8. This report raised the 407,966 bales of cotton consumed in the cotton the estimate of probable production in the United growing states in September, Fifth district mills used States to 11,425,000 equivalent 500-pound bales, in 235,734 bales, or 57.78 per cent, a slightly higher fig comparison with an estimate of 11,310,000 bales on ure than 57.06 per cent of Southern consumption at September 1, 1932, and final ginnings of 17,096,000 tained by Fifth district mills in September last year. On October 20, the Department of Commerce issued bales in 1931. The October 1 report raised this year's probable production figures for North and South Caro a report on spindles in place in September, spindles lina, but lowered Virginia's estimate, all in comparison active, total spindle hours of operation, and average with forecasts made a month earlier. South Caro hours of operation per spindle. On September 30, lina's yield is estimated at 610,000 bales, compared 1932, there were 31,545,832 spindles in place in the with 599,000 bales on September 1 and 1,005,000 bales United States, North Carolina leading with 6,164,334, grown last year. North Carolina's estimated crop of or 19.54 per cent of the total, Massachusetts ranking 519,000 bales compares with an estimate of 514,000 second with 6,142,718 spindles, or 19.47 per cent, and MONTHLY REVIEW South Carolina third with 5,697,796 spindles, or 18.06 per cent. The Fifth district as a whole had 39.75 per cent of total spindles in place in the United States at the end of September 1932. In actual spindle hours of operation, South Carolina led all states for Septem ber with 1,896,627,580 hours, or 27.62 per cent of the National total of 6,866,031,482 hours, and North Caro lina ranked second with 1,507,081,464 hours, or 21.95 per cent, while Massachusetts had only 715,781,158 hours, or 10.42 per cent. The Fifth district, with 39.75 per cent of total spindles in place in the United States in September, showed 51.86 per cent of total hours of operation. In actual hours of operation per spindle in place, the Fifth district states did not compare so favorably with others, South Carolina with an average of 333 hours per spindle ranking second, North Caro lina with 244 hours ranking sixth, and Virginia with 231 hours ranking seventh. The average hours of operation for the United States was 218, considerably lower than the average in any Fifth district state. Tobacco South Carolina auction markets sold 20,201,276 pounds of producers’ tobacco in September, at an aver age price of $11.25 per hundred pounds, compared with 28,271,959 pounds sold in September 1931, at $9.37 per hundred. Total sales for the 1932 season to the end of September amounted to 32,486,067 pounds, and the average season price was $11.46 per hundred. Mul lins led in sales last month with 8,206,034 pounds, Lake City ranking second with 4,540,653 pounds. South Carolina tobacco production in 1932 was fore cast on October 1 as 32,640,000 pounds, compared with 70.070.000 pounds grown in 1931, and a five-year av erage of 68,328,000 pounds. North Carolina growers sold 66,600,614 pounds of tobacco on auction floors in September, at an average price of $11.57 per hundred pounds, compared with 96,259,217 pounds sold in September 1931 for $9.56 per hundred. Prices are higher than a year ago as a result of a short crop in the United States, but a record carry-over of tobacco from previous years is partly offsetting the effects of this year’s short crop. On October 1 the 1932 tobacco yield for North Carolina was estimated at 277,032,000 pounds, compared with 479.526.000 pounds harvested last year and a five-year average of 403,133,000 pounds. Greenville led in Sep tember sales with 9,648,044 pounds, Wilson ranking second with 9,020,085 pounds. Virginia tobacco markets opened in October and no sales figures are yet available. Last year the Virginia markets sold 916,596 pounds in September. Weather was favorable for harvesting tobacco in September, but the crop is later than usual and only 83 per cent of the crop had been gathered on October 1, com pared with 98 per cent of the 1931 crop harvested prior to October. The forecast of production of to bacco in Virginia this year is 53,350,000 pounds, com pared with 97,920,000 pounds harvested in 1931 and a five-year average production of 126,860,000 pounds. Maryland's prospective yield of 25,340,000 pounds 5 of tobacco this year compares with 32,160,000 pounds grown in 1931 and a five-year average of 24,369,000 pounds. West Virginia tobacco prospects this year indicate a probable production of 2,760,000 pounds, only a little over half of 5,320,000 pounds grown in 1931, and also much below the five-year average production of 4,868,000 pounds. Agricultural Notes Except in South Carolina, all crops in the Fifth re serve district deteriorated in September, due to con tinued hot, dry weather. Some sections of the dis trict, especially in Maryland and Virginia, approached the severe drought conditions of 1930, but since the extreme dryness this year developed later in the sea son and was less extensive in area, the damage done to crops was less severe than the damage done in 1930. Maryland weather was dry and hot for the fourth consecutive month in September, and crops declined materially. No general rains occurred between June 1 and October 1. The corn crop in Maryland this year is estimated at 15,540,000 bushels, compared with 20,710.000 bushels harvested in 1931, and this year’s oat crop of 1,440,000 bushels compares with 2,010,000 bushels threshed last year. Tame hay yields total 481.000 tons this year, an increase over 469,000 tons cut in 1931, but the average condition of pastures in Maryland on October 1 was only 45 per cent against 80 per cent on the same date a year ago. Irish po tatoes declined in production this year to 3,026,000 bushels from the 1931 yield of 3,360,000 bushels, and sweet potatoes produced only 1,300,000 bushels in 1932 in comparison with 2,013,000 bushels last year. The commercial apple crop of Maryland is only 259,000 barrels this year, compared with 650,000 barrels picked in 1931, and the fruit this year is small and poorly colored. Virginia experienced drought weather in September, and crops declined in condition throughout the state. General rains early in October were very beneficial to pastures, late gardens and vegetables, and also per mitted better preparation of the land for seeding fall grain, but came too late to do much good to this year’s major crops. The corn crop turned out about as had been expected, with good yields on bottom lands but very poor returns from upland fields. Total produc tion of corn this year is forecast at 27,000,000 bushels, compared with 43,061,000 bushels last year and a fiveyear average of 35,681,000 bushels. The yield of oats turned out slightly better than had been expected, but the crop of 3,230,000 bushels was much lower than 4.838.000 bushels harvested last year. Hay crops are smaller than usual, although early hay turned out well. This year’s hay cut of 847,000 tons compares with 993.000 tons cut last year. Some of last year’s good crop is still on the farms, and with this year’s yield will provide sufficient feed for stock during the com ing winter except in about fifteen counties in central and southern Virginia. The condition of pastures de clined throughout Virginia in September, and in most 6 MONTHLY REVIEW sections of the state provided so little grazing that farmers were forced to feed their livestock, but rains at the end of September and in the first half of Oc tober greatly improved the growth of grass. Peanuts did not develop well during September, and farmers are finding fewer nuts on the vines than usual. Total production of peanuts is forecast at 120,400,000 pounds, compared with 164,160,000 pounds last year and a fiveyear average of 124,463,000 pounds. The late potato crop was very poor in most parts of the state and some growers actually harvested fewer potatoes than they planted. A crop of 9,400,000 bushels is forecast on the basis of the October 1 condition, compared with 14.278.000 bushels dug in 1931 and a five-year aver age production of 15,357,000 bushels. The sweet po tato yield this year is also lower than that of 1931, the 1932 crop of 3,610,000 bushels comparing with 4.750.000 bushels dug last year. There was a reduc tion of about 20 per cent in the commercial apple crop during September. As a result of the dry weather, apples are much smaller than usual and worm injury has reduced the percentage of the crop suitable for packing. The October 1 forecast of 1,560,000 barrels is less than half the 1931 crop of 3,500,000 barrels and is also appreciably below the five-year average of 2,602.000 barrels. On account of the small size and worm injury growers estimate that only 39 per cent of the crop wiU pack U. S. No. 1 grade or better, com pared with 48 per cent last year. West Virginia was dry in September, to the general detriment of late crops and pastures. Corn pros pects on October 1 indicated a yield this year of 10,600.000 bushels, compared with 12,934,000 bushels harvested in 1931. Nearly all corn had been cut and shocked by the end of September. The yield of oats this year is 2,992,000 bushels, compared with 3,552,000 bushels last year. Irish potatoes were nearly all har vested before October 1, and this year’s yield of 3,520.000 bushels exceeds the 1931 crop of 3,200,000 bushels. Apples suffered further loss in September, and the part of the total crop which is classed as com mercial is 630,000 barrels, compared with 1,700,000 barrels shipped in 1931. Hay yields totaling 583,000 tons are reported for this year, against 650,000 tons cut last year and a five-year average of 835,000 tons. On October 1 the condition of pastures in West Virginia was only 47 per cent of normal, compared with 86 per cent a year ago. North Carolina was extremely dry during July, Aug ust and September, and such crops as hay, fruits, corn and potatoes suffered materially. General rains fell early in October, but too late to be of much assistance to leading crops. Corn production in North Carolina is estimated to be 35,520,000 bushels this year, com pared with 48,072,000 bushels in 1931 and a five-year average of 37,722,000 bushels. The oat crop turned out 3,978,000 bushels, compared with 4,531,000 bushels in 1931 and a five-year average of 2,756,000 bushels. Hay yields total 588,000 tons this year, compared with 677.000 tons last year. The 1932 yield of sweet po tatoes is the only major crop which shows an increase in yield over the 1931 yield, 7,120,000 bushels this year comparing with 6,560,000 bushels in 1931. The North Carolina apple crop of 1,825,000 bushels is far below last year’s yield of 5,328,000 bushels. Peanut pro duction is expected to total 239,400,000 pounds this season, compared with 305,900,000 pounds harvested in 1931. South Carolina crops changed little during Septem ber, weather in that state being more favorable than in the other states in the Fifth district. Crops average about 27 per cent less than the good yields of 1931 and about 10 per cent below the five-year average. Corn production in South Carolina this year totaled 18,040,000 bushels, compared with 22,994,000 bushels in 1931, and the hay crop of 202,000 tons exceeded last year’s yield of 178,000 tons. Sweet potatoes turned out 4,800.000 bushels in 1932, compared with 3,180,000 bushels in 1931. Peanut production in South Carolina totaled 8,750,000 pounds this year, compared with 9,100.000 pounds harvested last year, and this year’s apple crop of 164,000 bushels compares with 320,000 bushels gathered in 1931. The tobacco and cotton crops, mentioned elsewhere in this Review, account for most of the decline in total agricultural production in South Carolina this year in comparison with 1931. Construction Building Permits Issued, Fifth District Cities, September 1932 and 1931 CITIES Total Valuation 1932 1931 1,234 $1,649,280 $1,463,160 3,459 30,110 10 8,831 2,875 8 3,680 9,825 13 23,150 23,700 35 5,882 22,475 15 27,835 78,641 53 75,728 142,779 156 675 7,535 29 11,680 26,615 33 49,916 397,868 123 11,394 120,997 41 3,050 2,440 9 20,136 53,854 46 6,115 477,715 24 10,455 53,215 36 9,724 6,115 33 39,231 109,477 46 8,445 308,825 13 48,983 24,235 46 12,450 44,000 29 19,342 12 10,600 60 8,475 6 5,250 79,060 13 13,050 24,050 20 11,300 56,220 83 7,600 37,773 35 13,081 81,326 75 14,100 42,545 42 12,560 12,435 12 5,731 3,795 15 2,275,065 497 971,280 Permits Issued 1932 1931 Baltimore, Md--------- 1,102 9 Cumberland, Md----17 Frederick, Md._____ 10 Hagerstown, Md.----33 Salisbury, -Md.-------12 Danville, Va._____ ... 31 Lynchburg, Va.------92 Norfolk, Va---------4 Petersburg, Va-------26 Portsmouth, Va-----Richmond, Va______ 103 23 Roanoke, Va.______ 2 Bluefield, W. Va___ 69 Charleston, W. Va__ 24 Clarksburg, W. Va._ 24 Huntington, W. Va.... 18 Asheville, N. (C____ 34 Charlotte, N. C____ 7 Durham, N. C._____ 43 Greensboro, N. C.___ 8 High Point, N. C__ 14 Raleigh, N. C._____ 1 Rocky Mount, N. C— .. 4 Salisbury, N. C.____ 15 Wilmington, N. C.__ 42 Winston-Salem, N. C. 42 Charleston, S. C, __ 41 Columbia, S. C.......... 22 Greenville, S. C. 13 Rock Hill, S. C. .. 24 Spartanburg, S. C.__ Washington, D. C.__ 483 Totals __________ 2,392 2,852 $3,094,711 $6,046,542 Building permits issued by building inspectors in thirty-two cities in the Fifth reserve district in Sep tember totaled 2,392, with estimated valuation amount MONTHLY REVIEW ing to $3,094,711, a decrease of 16.1 per cent in num ber in comparison with 2,852 permits issued in Sep tember 1931, and a decrease of 48.8 per cent under September 1931 valuation figures totaling $6,046,542. Only seven of the thirty-two cities reported higher figures for the 1932 month, and several cities which issued relatively large amounts in permits in Septem ber last year declined drastically this year. Contracts awarded in September for construction work in the Fifth district, including both rural and urban projects, totaled only $10,684,728, compared with $13,611,282 in August 1932 and $20,573,415 in Sep tember 1931. Of the awards in September this year, $2,076,918, or 19.4 per cent, was for residential work, while last year residential contracts in September total ed $4,034,385, or 19.6 per cent of all awards. W holesale Trade, 62 Firms___________________ 22 9 6 Groceries Dry Goods Shoes 13 Hardware 12 Drugs September 1932 sales, compared with sales in September 1931: —16.5 — .8 + .5 —17.5 —19.4 September 1932 sales, compared with sales in August 1932: + 7.3 +54.7 +24.0 +24.3 + 7.6 Jan.-Sept. 1932 sales, compared with Jan.-Sept. 1931 sales: —17.0 —24.0 —14.6 —21.4 —18.5 Sept. 30. 1932, stocks, compared with Sept. 30, 1931, stocks: —10.1 (8^) —18.6 (4*^ —36.3(5*) —13.2(7*) ........ Sept. 30, 1932, stocks, compared with Aug. 31, 1932, stocks: + 7.1(8*) +7.6(4*) — 6.8(5*) + .4(7*) Percentage of Sept. 1, 1932, receivables collected in September: 56.2(13*) 35.0(6*) 37.7(6*) 27.3(11*) -44.4(8*) ♦Number of reporting firms. Retail Trade, 33 Department Stores Richmond Baltimore Washington Other Cities District September 1932 sales, compared with sales in September 1931: —10.4 —11.5 — 9.0 —15.6 —10.8 January-September 1932 sales, compared with Jan.-Sept. 1931: —20.4 —20.2 —15.3 —25.1 —18.8 Sept. 30, 1932, stocks, compared with stocks on Sept. 30, 1931: —20.9 —20.5 —12.6 —25.0 —18.2 Sept. 30, 1932, stocks, compared with stocks on August 31, 1932: + 5.7 + 9.5 +13.3 + 6.2 +10.2 Number of times stock was turned in September 1932: .333 .323 .336 .247 .32 Number of times stock was turned since January 1, 1932: 2.552 2.536 2.664 1.831 2.505 Percentage of Sept. 1, 1932, receivables collected in September: 26.0 1&9_______24J_______ 2U _______ 21.6 7 (Compiled October 21, 1932) MONTHLY REVIEW 8 BUSINESS CONDITIONS IN THE UNITED STATES (Compiled by the Federal Reserve Board) Industrial activity and shipments of commodities by rail increased from August to September by consid erably more than the usual seasonal amount. There was also a more than seasonal increase in the volume of factory employment and payrolls. The general level of prices, after advancing for three months, showed a decline beginning in the early part of September. Production and Employment Volume of industrial production, as measured by the Board’s seasonally adjusted index, based on the 1923-1925 average, increased from a low point of 58 in July to 60 in August and 66 in September. The advance in September reflected chiefly large increases in activity at textile mills, shoe factories, meatpacking establishments, and coal mines. In the steel industry, where activity had shown none of the usual seasonal increase in August, operations expanded considerably during September and the first three weeks of October to about 20 per cent of capacity. Daily average output of automobiles and lumber in September showed little change from recent low levels. Factory employment increased from 58.8 per cent of the 1923-1925 average in August to 60.3 per cent in September, according to the Board's seasonally adjust ed index. Considerable increases were reported in the cotton, woolen, silk, hosiery, and clothing industries, and smaller increases at car building shops, foundries, cement mills, and furniture factories. In the automo bile, tire and electrical machinery industries, employ ment declined. During the three months ending with September value of building contracts awarded, as reported by the F. W. Dodge Corporation, was about the same as in the preceding three months, although awards are usually smaller in the third quarter. In the first half of October the daily average of contracts declined somewhat. Distribution Volume of freight-car loadings increased by con siderably more than the usual seasonal amount in Sep tember, reflecting chiefly larger shipments of coal and miscellaneous freight. Department store sales increased from the low level of August by somewhat more than the usual seasonal percentage. W holesale Prices Wholesale commodity prices, as measured by the monthly index of the Bureau of Labor Statistics, showed little change from August to September. Dur ing August and early September there was a general advance in prices followed by a decline which con tinued through the first half of October, when the av erage was 2 per cent below the high point in early Sep tember and 1 per cent above the low point of early summer. Substantial decreases occurred after the be ginning of September in the prices of many domestic agricultural commodities, including cotton, grains, and livestock, and also in prices of gasoline, nonferrous metals, and imported raw materials; while prices of wool, worsted yarns, coal, and lumber increased some what during this period. Bank Credit During September and the first three weeks of Oc tober there were further additions to the reserve funds of member banks, arising from increases in the coun try’s stock of monetary gold, from an unseasonal re turn flow of currency, and from issues of additional national bank notes. Member bank indebtedness to the reserve banks declined by more than $100,000,000 from September 7 to October 19 and their reserve bal ances increased by $180,000,000. During September and the first two weeks of Oc tober reporting member banks in leading cities showed a further growth in investment holdings, largely of United States Government securities, but to some ex tent of other investments. Loans of reporting banks declined further in September; in the early part of October loans at banks in New York City showed an increase. There was considerable growth in Govern ment deposits and in bankers’ balances during the pe riod ; time deposits also increased. Money rates in the open market declined to lower levels during the first half of October, the rate on prime commercial paper being reduced from a range of 2-2J4 to a range of 1 ^-2 per cent, and the rate on 90-day bankers’ acceptances from % of one per cent to y2 of one per cent. Rates for call loans on stock exchange collateral declined from 2 per cent to 1 per cent.