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MONTHLY

REVIEW

o f Financial and Business Conditions

F ifth
FEDERAL

Reserve
D is tr ic t

October 31, 1939

Federal Reserve Bank, Richmond, Va.

Summary of September Business Conditions
EM P L O Y M E N T INCREASES S H A R PLY

N D U S T R IA L activity in the Fifth Reserve district
expanded more than normally in September, coal min­
ing leading the increase chiefly as a result o f greater de­
mand from domestic users but also because o f a sub­
stantial increase in exports as a result o f the European
war. Cotton textile mills increased their operations on
a daily basis, and rayon yarn mills shipped more yarn
than they could produce, cutting further into their small
reserve stocks. Tobacco manufacturing declined from
August figures, but continued ahead o f 1938.

I

Construction tends to decline in the fall, and work
provided for in September permits dropped 9 per cent
below the August figure, but contract awards were prac­
tically equal to those in the preceding month. This rela­
tively large volume o f building, together with substantial
gains in some industrial activity and in coal minng, materally increased demand for labor and claims for un­
employment compensation at State agencies are said to
have declined sharply.
T O B A C C O M ARKETS REOPEN

Auction tobacco markets, which closed on September
13 after export buyers retired, opened again on October
10 with the buyers for foreign concerns back on the mar­
kets, but operating as agents for the Commodity Credit
Corporation. The Department o f Agriculture, through
the Commodity Credit Corporation, arranged to have
certain buyers act as agents for the Corporation, the to­
bacco to be paid for and held by the C. C. C. under an
option arrangement. This arrangement prevented price
demoralization and is enabling growers to market their
crop in an orderly manner. Meanwhile growers have
voted for a return to a marketing quota system in 1940,
to insure against over production next season.

D ISTR IBU TIO N OF GOODS H IG H ER

Consumer buying was well above seasonal expectations
in September. Department store sales exceeded August
sales by 39 per cent, and were 7 per cent above September
1938 sales, while representative furniture stores sold 9
per cent more than in August and 19 per cent more than
in September last year. Wholesale trade in most lines
also went substantially ahead o f sales in either August
1939 or September 1938. Sales o f new automobiles de­
clined from the August level while prospective buyers
awaited new models, but were 60 per cent ahead o f sales
in September last year.
BUSINESS

STATISTICS— FIFTH FEDERAL

RESERVE

DISTRICT

% Change
Month
Year

September 1939

August 1939

September 1938

Debits to individual accounts (24 cities).......
Sales, 30 department stores, 5th district.........
Sales, 36 furniture stores, 5th district.............
Sales, 199 wholesale firms, 5th district...........
Registrations, new autos, 5th district...............

$1,293,601,000
$ 10,326,177
$
1,424,579
$ 15,879,000
10,988

$1,218,844,000
$
7,409,362
$
1,304,352
$ 14,395,000
15,840

$1,184,526,000
$
9,657,064
$
1,202,169
$ 13,822,000
6,874

-f- 6
+39
+ 9
+10
—31

+ 9
+ 7
+19
+15
+60

T obacco sold in 5th district (P ou nds)..........
Growers’ receipts from tobacco, 5th district..
Average price of tobacco, per 100 pounds.......
Number of business failures, 5th district.......
Liabilities in failures, 5th district....................
Value o f building permits, 31 cities..................

111,366,137
14,160,093
12.71
31
$
381,000
$
7,765,960

219,924,342
35,233,572
16.02
35
$
246,000
$
8,498,125

208,795,475
44,207,248
21.17
43
$
455,000
$ 10,030,113

—49
—60
—21
— 11
+ 55
— 9

— 47
—68
— 40
—28
— 16
—23

Value of contracts awarded, 5th district.........
Cotton consumption, 5th district (B a les).......
Cotton price, c per lb., end of month.................
Print cloths, 38 ^ in., 64x60s, end o f month....
Rayon yarn shipments, U. S. (pounds)...........
Rayon yarn stocks, U. S. (pounds)................
Bituminous coal mined, U. S. (T o n s)...............

$

$

$

0
0
+ 4
+19
+ 5
—31
+ 9

+ 15
+14
+10
+26
—
1
— 62
+ 17




$
$

32,058,000
297,816
9.08
5.50
32,800,000
13,000,000
37,695,000

$
$

32,213,000
299,195
8.76
4.63
31,300,000
18,900,000
34,688,000

$
$

27,955,000
260,260
8.25
4.38
33,100,000
34,600,000
32,286,000

MONTHLY REVIEW

2
N O TE

C IR C U L A T IO N

INCREASES

SE A SO N A LLY

Government security holdings of the Federal Reserve
Bank o f Richmond declined between September 15 and
October 15 as a result of a reallocation of System hold­
ings on October 1. The volume o f Federal Reserve notes
in circulation showed further seasonal increase as crop
marketing spread and fall trade expanded. Discounts for
member banks rose slightly, but at the same time member
bank reserve deposits also increased. Cash reserves of
the bank rose during the month, chiefly due to receipts
from the shift of securities to other Reserve banks.
RESERVE B AN K STATEMENT ITEMS
Fifth District
000 omitted
Sept. 15
Oct. 15
ITEMS
1939
1939
Discounts held ......................................
Foreign loans on gold .....................
Open market paper ...........................
Industrial advances ............................
Government securities .......................
Total earning assets .....................
Circulation of Fed. Res. notes . . . .
Members’ reserve deposits ...............
Cash reserves ........................................
Reserve ratio ........................... ............

$

360
142
24
1,023
139.408
$140,957
215,245
283,686

Oct. 15
1938
$

324
0
23
1,461
120,321
$122,129
208,740
224,898
389,278
76.99

$

200
87
23
1,043
151,912
$153,265
210,496
273,187
398,943
72.48

LOANS, IN VESTM EN TS A N D DEPOSITS RISE

Loans and discounts continued to increase moderately
in 41 reporting member banks between September 13 and
October 11, and deposits also rose by more than the in­
crease in loans. All figures in the skeleton statement
show substantial increases over figures for October 12,
1938.
SELECTED ITEMS— 41 REPORTING BANKS
Fifth District
000 omitted
ITEMS
Oct. 11
Sept. 13
1939
1939
Loans & discounts ....................................
Investments in securities .......................
Reserve bal. with F. R. bank ...............
Cash in vaults ............................................
Demand

deposits

$255,652
446,514
180,616
23,413

Oct. 12
1938

$248,637
433,539
183,969
23,043

............................................

530,923

521,368

Time deposits ..............................................
Money borrowed ........................................

200,504
0

$237,763
422,107
146,965
19,908
471,987
198,800

200,024
0

dustrial activity in nearly all lines has increased since
September 1, and the weather was so favorable for out­
door work that no recession occurred in that field. T o ­
bacco markets which closed at the middle o f September
reopened on October 10, with additional openings in V ir­
ginia, giving employment to many handlers, graders, etc.
One large industry in the district has announced wage
increases to be made in the near future averaging approxi­
mately 10 per cent, and it is estimated that the increase
in base pay under the Fair Labor Standards A ct made
on October 24 will further increase wages o f many thou­
sands o f Fifth district workers, chiefly in tobacco hand­
ling concerns, saw mills, fertilizer plants and textile mills.
The following figures, compiled for the most part by the
Bureau o f Labor Statistics, show the trends o f employ­
ment and payrolls in the Fifth district from August to
September:
Percentage change from
Aug. 1939 to Sept. 1939
in number
in amount
on payroll
of payroll

STATES
.............
West Virginia .................................. .............
North Carolina ..........................
.............
South Carolina ................................

+ 1.7
+2.4

Debits to individual accounts in 24 Fifth district cities
rose 6 per cent in September over August debits, and
also gained 9 per cent in comparison with debits in Sep­
tember 1938. A n increase in September over August is
seasonal, and every reporting city except three showed
higher figures for the later month. The declines in Dan­
ville and Durham were due to tobacco markets being closed
this year during the last half o f September, and the de­
crease in Columbia resulted from an unusually high
August figure.
DEBITS TO IN D IV ID U AL ACCOUNTS
Fifth District
Sept.
1939

CITIES

Deposits in 10 mutual savings banks in Baltimore, after
declining in July and August on account of vacation with­
drawals, turned upward again in September by about the
usual amount. Total deposits on September 30, 1939, of
$219,921,027 compared with $219,426,239 on August 31
this year and $217,903,802 on September 30 last year.
CO M M E R C IA L FAILURES DECREASE

Commercial failures in the Fifth district and the United
States were reported by Dun & Brad street as fo llo w s:
Number of Failures
District U. S.

PERIODS
September 1939 .....................
August 1939 ............................
September 1938 .....................
9 Months, 1939 .....................
9 Months, 1938 .....................

31
35859
43866
432
489

Total Liabilities
District
U. S.

758

$ 381,000
246,000
455,000

9,097
9,980

$4,778,000
6,356,000

$

9,402,000
11,259,000
14,341,000

$128,494,000
184,456,000

EM P L O Y M E N T A N D PA Y R O L L S RISE

Employment broadened in September and the first half
of October, and unemployment compensation payments
declined as employment agencies found work for many
applicants and industrial plants called workers back. In­




8.6
3.2
4.0
2.4
4.3
2.7

DEBITS RISE SH A R PLY

0

M U T U A L SAVINGS TU R N UPW ARD

+
+
+
+
+
+

+9.5

Dist. of Columbia ............................

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

000 omitted
Aug.
Sept.
1939
1938

of Change
Year
Month

%

+ 9
+ 4
+ 26

+ 16
+ 5
+ 20

231,490

+

7

+ 14

10,399
14,599
7,630
43,779
3,982
184,248
23,825

— 1
+ 9
+ 17
+ 13
+ 12
+ 1
+ 5

— 12
0
+ 47
+ 13
+ 10
— 7
+ 9

$ 355,028
7,833
10,115

$ 325,562
7,546
8,030

$ 306,963
7,472
8,410

Dist. of Col.
Washington

263,294

246,187

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

9,114
14,661
11,247
49,575
4,398
170,576
25,886

9,170
13,405
9,602
43,747
3,913 .
169,458
24,621

West Virginia
Charleston ...........
Huntington .........
Parkersburg .........

47,526
17,514
9,522*

46,420
15,673
9,607*

41,110
14,285

+ 2
+ 12
— 1

+ 16
+ 23

North Carolina
Asheville ...............
Charlotte .............
Durham .................
Greensboro ...........
Raleigh .................
Wilmington ........
Winston-Salem . .

12,898
64,911
35,558
20,241
42,162
11,617
42,067

12,499
61,310
41,281
18,095
40,266
11,111
40,681

12,234
55,547
44,326
17,557
39,612
11,582
39,914

+ 3
+ 6
— 14
+ 12
+ 5
+ 5
+ 3

+ 5
+ 17
— 20
+ 15
+ 6
0
+ 5

South Carolina
Charleston ...........
Columbia .............
Greenville .............
Spartanburg

18,017
26,698
21,101
11,564

15,489
27,256
17,710
9,812

14,821
24,795
17,512
8,434

+ 16
— 2
+ 19
+ 18

+ 22
+ 8
+ 20
+ 37

$1,293,601

$1,218,844

$1,184,526

+

+

District Totals

..

* Not included in Totals.

6

9

3

MONTHLY REVIEW
A U T O SALES D ECLIN E SE A SO N A LLY

New models of automobiles, for which buyers began
waiting toward the end of August, did not come out until
late September or early October, and sales o f new cars
last month in the Fifth district were materially lower than
in August but exceeded September 1938 sales by 60 per
cent. Many dealers had only a few cars on their floors
during September.
Stocks o f u sed . cars are reported
moderate, and dealers apparently occupy a favorable po­
sition for fall business. The following registration fig­
ures for new cars were furnished by R. L. Polk & C o.:
REGISTRATION OF N E W
Sept.
1939

STATES
Maryland ...........
Dist. of Col. . . .
Virginia .............
West Virginia ..
No. Carolina .. .
So. Carolina . ..
District ...........

2,585
1,340
2,190
1,260
2,388
1,225
10,988

Sept.
1938
1,169
712
1,709
764
1,680
840
6,874

PASSENGER CARS— NUMBER
%

Change
+ 121
+ 88
+ 28
+ 65
+ 42
+ 46
+ 60

9 Months 9 Months
19*39
19318
29,496
19,191
31,679
16,915
33,540
18,622
149,443

18,836
12,613
22,879
12,059
22,469
10,710
99,566

%
Change
+ 57
+ 52
+ 38
+ 40
+ 49
+74
+ 50

CO N STR U C TIO N SLACKENS

A s is usually the case in September, construction work
provided for in building permits issued and contracts
actually awarded last month declined from the summer
volume. Estimated valuation o f permits issued in 31
Fifth district cities totaled $7,765,960 in September, com ­
pared with $8,498,125 in August and $10,030,113 in Sep­
tember 1938. Washington led in permit valuation last
month with $2,874,570, followed by Baltimore with $1,097,394, Charlotte with $586,854, Charleston, S. C., with
$486,968, and Charleston, W . Va., with $385,005.
Eighteen of the 31 cities reported higher figures for Sep­
tember 1939 than for September 1938, but a decrease o f
nearly $2,500,000 in Washington brought the district
total down by 23 per cent last month. Permits issued in
the first 9 months o f 1939 totaling $91,236,608 exceeded
the 1938 figure o f $65,109,426 for the corresponding pe­
riod by 40 per cent.
Contracts awarded in September for all types o f con­
struction in the Fifth district totaled $32,058,000, a very
small decline from $32,213,000 for August but 15 per
cent above $27,955,000 in September 1938. Total con­
tracts awarded from January through September amount­
ed to $302,781,000 this year and $216,358,000 last year,
a gain of 40 per cent in 1939. Figures collected by the
F. W . Dodge Corporation by states for September 1939
and 1938 on construction contracts awarded are as fol­
lows :
CONSTRUCTION CONTRACTS AW ARDEt)
STATES

Sept. 1939

Sept. 1938
$ 6,351,000
4,068,000
6,565,000
1,770,000*
5,943,000
3,505,000
$28,202,000

+
5
— 22
— 11
+ 82
0
+118
+ 15

TE X T IL E ORDERS L E V E L OFF

In the first half o f September cotton textile mills re­
ceived orders materially ahead o f production, but in late
September and early October operations were increased
while orders declined, bringing about an approximate bal­
ance. Cloth and yarn prices were well maintained at
higher levels attained in September. W ith orders on
hand to insure full time operations for the fall, many
mills are not seeking additional commitments at current
prices.
Consumption o f cotton by states in the Fifth district
in September 1939, August 1939, and September 1938, in
bales, is shown b e lo w :
COTTON CONSUMPTION— FIFTH DISTRICT
In Bales
MONTHS
September 1939 .................
August 1939 .......................
September 1938 .................
!) Months, 1939 .................
9 Months, 1938 ...................

No. Carolina So. Carolina
166,640
118,362
163,494
121,535
138,826
110,280
1,396,400
1,102,986

1,045,694
855,271

Virginia
12,814
14,166
11,154
105,770
102,665

District
297,816
299,195
260,260
2,547,864
2,060,922

R A Y O N SHIPM ENTS EXCEED PRO D U CTIO N

Data from Rayon Organon for October indicate that
rayon filament yarn consumption has reached a point above
the industry’s capacity to produce yarn at present deniers
spun, and it is therefore apparent that with less than two
weeks’ supply o f yarn on hand producers cannot ship as
much during the next quarter as they did last quarter,
when 97,000,000 pounds were shipped by reducing reserve
stocks from 32,600,000 pounds at the end o f June to
13,000,000 pounds at the end o f September. Shipments
of yarn last month totaled 32,800,000 pounds, o f which
5,900,000 pounds came from reserve stocks. The rayon
industry has reduced the advance booking period from a
maximum o f 90 days to 60 days.

% Change

Maryland
........................................
$ 6,693,000
Dist. of Col............................... ........
3,172,000
Virginia
..........................................
5,811,000
West Virginia .............................
3,229.000*
North Carolina ...........................
5,926,000
South Carolina .............................
7,641,000
Fifth District ...........................
$32,472,000
* Includes some contracts outside 5th district.

raised fuel requirements o f domestic consumers.
Car
loadings o f coal were reported at an all-time high by one
leading carrier during the week ended September 29. A d ­
vances in coal prices have so far been unimportant. T on ­
nage o f bituminous coal mined in the United States in
September totaling 37,695,000 net tons was 9 per cent
above 34,688,000 tons mined in August 1939 and 17 per
cent above 32,286,000 tons in September 1938. Ship­
ments o f coal through Hampton Roads this calendar year
to October 7 totaled 14,459,734 tons, compared with
12,391,038 tons shipped to the same date in 1938. The
demand for foreign cargo coal is expected to continue far
above recent figures as long as Europe remains at war.

D EM AN D FO R C O A L RISES SH A R PLY

Bituminous coal production, which had increased stead­
ily since the April-M ay shutdown, took a sharp jump fur­
ther upward immediately after the beginning o f war in
Europe, and foreign cargo loadings at Hampton Roads
increased several-fold. A rise in industrial activity also




CO TTO N CROP ESTIM ATE IS REDUCED

Spot cotton prices fluctuated around 9 cents per pound
from the middle o f September to the middle o f October.
On September 15 the average price for middling grade
cotton on 10 Southern markets was 9.18 cents, but dropped
to 8.96 cents on September 22. A fter advancing again to
9.08 cents on September 29, the price declined to 8.97
cents on October 6 and held the same average to O cto­
ber 13.
The Department o f Agriculture reduced its estimate o f
1939 cotton production in its October report, placing the
figure at 11,928,000 bales against the September estimate
o f 12,380,000 bales, a decline o f 3.7 per cent. In contrast

4

MONTHLY REVIEW

with this National decline, the aggregate production fore­
cast for Fifth district cotton states was raised from 1,312,000 bales to 1,397,000 bales, an improvement o f 6.5
per cent during September.
COTTON CONSUMPTION AND ON HAND
(Bales)
Sept.
1938

Sept.
1939

Aug. 1 to Sept. 30
This Year Last Year

Fifth district states:
260,260
Cotton consumed .......................
297,816
Cotton growing states:
456,701
Cotton consumed .......................
534,735
Cotton on hand Sept. 30 in
930,577
Consuming establishments . .
727,333
Storage & compresses ........... 14,154,340 12,974,699
United States:
533,399
Cotton consumed .......................
624,902
Cotton on hand Sept. 30 in
Consuming establishments . .
870,862 1,107,351
Storage & compresses............. 14,175,815 13,033,511
388,658
Exports of cotton .........................
649,057
Spindles active, U. S..................... 22,231,976 22,183,972

597,011

533,611

1,066,367

1,253,350

Price per Cwt.
1939
1938

26,729,841
182,065,634
208,795,475
350,567,402

$19.01
21.49
21.17
22.27

$12.50
12.76
12.71
14.91

Auto supplies (7) .........
Shoes (5) ..........................
Dirugs (13) .....................
Dry goods (9) .................
Electrical goods (17) . .
Groceries (63) ............... ..
Hardware (19) ...............
Indus, supplies ( 11) . . .
Plumbing & heating (6)
Paper & products (8) . .
Tobacco & products( 7 ).
Miscellaneous (34) .........
Totals (199) ...............

TOBACCO PRODUCTS MANUFACTURED
Sept. 1939Sept. 1938
Smoking & chewing
tobacco, Pounds . . . . . . .
Cigarettes, number .................
Cigars, number .......................
Snuff, pounds ................... ..

%

27,411,852
27,056,195
14,789,904,810
14,710,977,947
486,864,568486,481,938
0
2,949,488
3,520,488

Change
+
+

1
1

— 16

R E T A IL A N D W H O LESALE TR A D E
DEPARTMENT STORE TRADE
Net Sales
Sept. 1939
comp, with
September
1938

Richmond (3) . . .
Baltimore (8) . . .
Washington (6) .
Other Cities (13)
District (30) . .

+
+
+
+
+

7.2
5.6
7.6
8.1
6.9

Same stores by states,
with 28 stores added:
Virginia (13) . .
+ 7.7
West Va. (10) . .
+ 7.3
No. Carolina (8) .
+ 8.2
So. Carolina (13)
+ 1 4 .6




Net Sales
Sto OKS
Jan. 1 to date Sept., 3,0, 1939
comp, with
comp/ with
same period Sept.
Aug.
last year
1938
1939
+

+
+
+
+

3.0
1.7
5.0
4.6
3.6

+ 3.6
+ 2.9
+ 1.9
+ 15.5

+
+
+
+
+

6.9
2.1
3.2
2.2
3.1

+
+
+
+
+

12.4
13.0
11.5
1.5
11.0

Ratio S?pt.
collections
to accounts
outstanding
Sept. 1
30.9
31.2
26.6
26.9
28.5

+10
+

+
+

6
9
+12

6

+ 32
+ 61
+ 19
+ 24
—

2

+10

+ 30

+

8

+ 6
+ 2
+ 6

Net Sales
September 1939
compared with
Sept.
Aug.
1938
1939
+2,3
+ 42
— 1
— 9
+ 4
+ 8
+ 34
+ 13
+ 59
+ 6
+ 16
+ 16
+ 19
+ 20
+ 32
+ 19
+ 3
+ 4
+ 13
+20
+ 10
0
+ 11
+ 8
+ 15
+ 10

Stocks
Ratio Sept.
Sept. 30, 1939
collections
compared with
to accounts
Sept. 30 Aug. 31 outstanding
1938
1939
Sept. 1
— 3
+ 2
70
— 17
48
+ 0
78
+ 3
+ 5
— 9
—
8
40
+ 32
— 4
72
+ 8
+ 7
87
—
1
42
+ 5
+10
63
+ 4
—
2
55
+ 5
— 11
— 5
61
79
+ ‘7
73
+ ‘i
— 2
64
+ 7

CROP FO RECASTS

The following figures show forecasts o f production
based on October 1 conditions, compared with yields in
1938 and in the 10-year period 1928-1937, and percent­
age changes in acreage this year over or under 1938.
Production figures marked ( - f ) were raised between
September 1 and October 1 , and those marked ( — ) were
lowered.
Cotton (Bales)
Yield
Yield
Acreage
1939
1938
— 15
12,000 —
12,000
— 11
475,000
388,000
0
910,000
648,000
Tobacco (Pounds)
29,562,000 +
+ 1
29,250,000
+ 16
126,563,000 +
98,906,000
— 6
2,175,000—
2,208,000
+21
692,120,000 — 516,850,000
+ 20
118,750,000
98,800,000
Corn (Bushels)
17,710,000
18,537,000
+ 1
0
36,136,000
34,775,000
13,737,000 —
+ 1
12,640,000
— 1
47,151,000
46,398,000
— 5
25,433,000
26,767,000
Oats (Bushels)
+ 5
1,182,000 —
1,312,000
+ 10
2,020,000
1,978,000
— 15
1,387,000 —
1,806,000
5,786,000
+ 4
5,566,000
11,750,000
+ 7
10,648,000
Hay (Tons)
491,000 —
543,000
+ 1
1,010,000
1,138,000
+ 1
709,000 +
802,000
+ 1
— 1
829,000 +
8*53,000
475,000
+ 1
431,000
Irish Potatoes (Bushels)
— 4
2,250,000 +
2,990,000
0
6,952,000—
10,349,000
— 3
2,852,000+
2,720,000
+ 10
8,091,000
8,690,000
+ 17
3,108,000
2,784,000
Sweet Potatoes (Bushels)
0
1,200,000 —
1,040,000
0
4,114,000 +
3,570,000
0
8,667,000 +
8,748,000
6,900,000
+ 5
6,468,000
Commercial Apples (Bushels)
1,700,000
1,419,000
7,700,000 —
7,268,000
4,000,000 —
3,227,000
560,000 —
480,000
Peanuts (Pounds)
184,800,000 +
+ 5
146,010,000
+ 5
285,200,000 +
249,075,000
+ 6
12,000,000 +
9,100,000
% Change

Virginia ............
North Carolina
South Carolina ,
Maryland ..........
Virginia .............
West Virginia .
North Carolina .
South Carolina .

T O B A C C O M A N U F A C T U R IN G DECLINES

Tobacco products manufactured in September declined
from August levels, but exceeded September 1938 figures
in all lines except snuff. The Bureau o f Internal Revenue
reports as follows on September manufacturing:

>Change in Sales, Sept. and 9 Months 1939
Compared with Compared with
Sept. 1938
9 Months 1938
+ 24
+ 6

W HOLESALE TRADE, 199 FIRMS

1,092,808

................................
................................
867,849
589,501
................................

Producers’ Tobacco Sales, Pounds
September 1939 September 1938
19,407,860
91,958,277
111,366,137
331,289,479

Maryland, 10 stores .....................
Dist. of Col., 7 stores ...............
Virginia, 9 stores .......................
North Carolina, 4 stores . . . . . .
South Carolina, 5 stores ...........
District, 36 stores* .................
Individual Cities:
Baltimore, 10 stores ...................
Richmond, 4 stores .............
Washington, 7 stores .................
* Includes one W . Va. store.

................................
................................

Auction tobacco markets, which closed on September
13 to prevent demoralization o f prices, opened again on
October 10. Prices on the reopening were slightly better
than those paid just prior to the shut-down, averaging
about 15 cents per pound. Export buyers returned to the
markets as agents for the Commodity Credit Corporation
o f the Department o f Agriculture, under an arrangement
by which the exporters have an option to buy the tobacco
from the C. C. C. at a later date. Exporters normally
buy about a third o f the flue-cured tobacco crop. Sales
o f tobacco in the Fifth district in September prior to the
closing o f the markets were as follows, compared with a
full month’s sales in September 1938:
STATES

STATES

927,132

T O B A C C O M ARKETS RESUM E SALES

So. Carolina .............
No . C arolina.............
Total
.......................
Season through . . .

RETAIL FURNITURE SALES

Maryland ..........
Virginia .............
West Virginia .
North Carolina .
South Carolina
Maryland .........
Virginia ...........
West Virginia
North Carolina
South Carolina
Maryland .........
Virginia . . . . . .
West Virginia
North Carolina
South Carolina
Maryland ........
Virginia ...........
West Virginia
North Carolina
South Carolina
Maryland ........
Virginia ...........
North Carolina
South Carolina
Maryland .........
Virginia ...........
West Virginia
North Carolina
Virginia ...........
North Carolina
South Carolina

(Compiled October 21. 1939^

Yield
1928-1937
40,000
702,000
827,000
25,217,000
98,075,000
3,400,000
493,927,000
79,624,000
15,617,000
32,225,000
12,384,000
41,355,000
21,335,000
1,364,000
2,287,000
2,218,000
3,906,000
8,488,000
464,000
916,000
645,000
654,000
338,000
3,257,000
12,352,000
3,109,000
8,028,000
2,476,000
1,156,000
4,285,000
7,896,000
4,965,000
1,331,000
8,153,000
3,576,000
657,000
148,630,000
238,750,000
8,517,000

MONTHLY REVIEW, October 31, 1939

FEDERAL RESERVE BANK OF RICHMOND

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

Volum e o f industrial production, w hich had turned up sharply last summer,
advanced still m ore rapidly in the six weeks a fter the outbreak o f w ar. E m ploy­
ment also increased but at a less rapid rate. Consum ption o f goods b y industry
and by individuals has not expanded so rap id ly as production and orders. B u y­
in g o f basic commodities, a fter a burst o f a ctivity in early Septem ber, has
slackened considerably, but orders fo r m any semi-finished goods and fo r finished
products, particu larly m achinery and railroad equipment, have continued in
la rge volum e. M ost orders have com e fro m dom estic sources. Prices o f basic
com m odities advanced sharply in the early pa rt o f September, but in recent
weeks prices o f foodstuffs have declined w hile prices o f industrial m aterials in
most instances have been maintained. P rices o f finished goods have shown a
much sm aller advance.

PRODUCTION
Index of physical volume of production, ad­
justed for seasonal variation, 1923-1925 average
=100.
By months, January 1934 to September
1939.
FRE1GHT-CAR LOADINGS

Index of total loadings of revenue freight, ad­
justed for seasonal variation, 1923-1924 average
=100.
By months, January 1934 to September
1939.

WHOLESALE PRICES

In Septem ber the B oard's seasonally adjusted index o f industrial production
advanced to 110 per cent o f the 1923-1925 average as com pared w ith 103 in
A u gust and 92 last spring. Increases in output o f iron and steel, flour, sugar,
m eat products, and petroleum w ere p a rticu la rly m arked in September. In the
steel industry ingot production rose from an average rate o f 61 per cent o f
capacity in A u gust to 71 in September. In the first three weeks o f October the
rate advanced fu rther to 90 per cent and actual volum e o f output w as at the
highest level on record. F lou r production rose to near record levels and at m eat­
packing establishments activity w as at the highest rate reached in several years.
The sharp increase in output o f crude petroleum follow ed a considerable reduction
in the previous month and curren tly production is at about the high rate p re­
v ailin g before wells w ere closed in the latter h a lf o f A ugust.
In other industries increases in activity, though quite general, w ere not so
marked. Autom obile production showed a sharp seasonal rise as volum e pro­
duction o f new model cars w as begun at m ost plants, and in related lines, such
as plate glass, activity also increased. T extile production increased som ewhat
fu rth er from the high level reached earlier. Shoe production, however, which
had been in la rg e volum e in the first eight m onths o f the year, decreased in
September. M ineral production advanced generally and iron ore shipm ent
schedules w ere expanded to build up stocks at low er lake ports before the close
o f the shipping season.
V alue o f construction contracts, as reported by the F. W . D odge C orpora­
tion, rose fu rth er in September, reflecting a contraseasonal increase in private
residential building. Other private construction showed little change and there
w as some reduction in the volum e o f new public projects, both residential and
nonresidential.

DISTRIBUTION
In September and the early part o f O ctober departm ent store sales increased
considerably. F reigh t-car loadings also advanced sharply, w ith the m ost marked
increases reported in shipments o f coal and o f miscellaneous freigh t, w hich in ­
cludes m ost m anufactured products.

COMMODITY PRICES

Indexes compiled by the U. S. Bureau of Labor
Statistics, 1926=100.
B3 weeks, 1934 to week
T
ending October 14, 19#9.

W holesale prices o f foodstuffs declined a fter the middle o f September,
follow in g sharp advances earlier in the month. P rices o f industrial com m odi­
ties, w hich rose considerably until the third w eek in September, subsequently
were generally maintained, although prices o f some m aterials, such as steel
scrap, hides, and rubber, declined from earlier peak levels.

MEMBER BANKS IN 101 LEADING CITIES

BANK CREDIT
Follow in g reductions during the early part o f September, Governm ent se­
cu rity holdings by member banks in 101 leadin g cities increased somewhat during
the three weeks ending O ctober 11, reflecting la rg ely the purchase o f T reasu ry
bills. Com m ercial loans continued to increase, but at a less rapid rate than in
late A u gust and early September. The volum e o f demand deposits at city banks
also increased further.
Excess reserves, w hich had increased sharply at mem ber banks during the
first h a lf o f September, showed fu rth er m oderate increases during the fo u r
weeks ending October 11.

MONEY RATES AND BOND YIELDS
Wednesday figures for reporting member banks
in 101 leading cities, September 5, 1934, to Oc­
tober 11, 1939. Commercial loans, which include
industrial and agricultural loans, represent prior
to May 19, 1937, so-called “ Other Loans” as then
reported.




Prices o f United States Governm ent securities increased in the latter part
o f September and the first h a lf o f October, follow in g sharp declines early in
September. A verage yields on long-term Treasu ry bonds declined from 2.79
per cent on September 21 to 2.62 per cent on October 16. Y ields on T reasu ry
notes declined to 0.78 per cent from 1.30 per cent early in September.