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MONTHLY

REVIEW

o f Financial and Business Conditions

F ifth
Federal

Re s e r v e
D is tr ic t

September 30, 1939

Federal Reserve Bank, Richmond, Va.

Summary of August Business Conditions
shipped nearly as much yarn as in July; tobacco manu­
facturers sharply increased output o f all their products;
and bituminous coal operators mined a very heavy ton­
nage for this season. Cotton mills have sufficient orders
on hand to keep them running for a number o f weeks,
and the demand for rayon is so strong that producers have
reduced stocks to a relatively low figure and are begin­
ning to readjust base prices upward.

H E total volume o f trade and industry in the Fifth
Federal Reserve district was fully up to seasonal
level in August, although one or two indicators lagged
slightly for special reasons. Since the beginning o f Sep­
tember, war in Europe has had several concrete effects
on business, among them being heavy buying o f textiles,
suspension o f auction tobacco sales, and some accumu­
lation o f inventories.
Distribution o f goods in August showed a substantial
rise over July, much o f which was seasonal. Sales in
representative department stores rose 20 per cent above
sales in the preceding month, and were also 6 per cent
larger than sales in August last year. Due chiefly to the
customary August sales, furniture sales at retail advanced
by 41 per cent over sales in July, and in addition rose 7
per cent over August 1938 sales. Wholesale trade in­
creased 22 per cent in August in comparison with July,
and was 7 per cent above trade in August last year. Sales
o f new automobiles in August exceeded sales in the same
month last year by 45 per cent, but declined somewhat
more than seasonally from July sales, buyers beginning to
wait for new models earlier than usual this year.

T

CO N STR U C TIO N A N D E M P L O Y M E N T H O LD UP

Construction continues at recent high levels, although
the value o f permits issued and contracts awarded in
August were both smaller than July figures. However,
both July figures were comparatively high. A continu­
ation o f construction on a large scale, with increased
activity in many lines, is keeping employment up and is
increasing the number o f workers in some fields.
A U C T IO N T O B A C C O M ARKETS SUSPEND

The only outstanding development o f an unfavorable
nature in the district in the past month was the necessity
o f closing auction tobacco markets early in September to
prevent price demoralization as a result o f the retirement
o f export buyers. W ith a very large crop o f tobacco to
be sold, this first direct result o f the European conflict is
extremely serious to tobacco growers in North Carolina
and Virginia, and to all lines o f business in the tobacco
growing sections o f those states.

IN D U S T R IA L A C T IV IT Y EXPAN D S

In industry, cotton textile mills expanded operations
around 17 per cent in A ugust; rayon mills, except for
one which was tied up by a strike, ran full time and

BUSINESS STATISTICS— FIFTH FEDERAL RESERVE DISTRICT

August 1939

July 1939

August 1938

Debits to individual accounts (24 cities)...........
Sales, 30 department stores, 5th district..............
Sales, 37 furniture stores, 5th district.................
Sales, 189 wholesale firms, 5th district................
Registrations, new autos, 5th district.................

$1,218,844,000
7,409,362
$
1,324,494
$
$ 12,664,000
15,840

$1,221,748,000
6,193,095
$
941,894
$
$ 10,367,000
19,962

$1,125,303,000
6,965,642
$
1,238,416
$
$ 11,831,000
10,903

Tobacco sold in 5th district (F ou nds)...............
Growers receipts from tobacco, 5th district.........
Average price o f tobacco, per hundred pounds..
Number o f business failures, 5th district...........
Liabilities in failures, 5th district........................
Value o f building permits, 31 cities....................

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

Value o f contracts awarded, 5th district.............
Cotton consumption, 5th district (B a les)...........
Cotton price, t per lb., end of month...................
Print cloths, 3 8 ^ in., 64x60s, end of month.......
Rayon yarn shipments, U. S. (P ou nds)...............
Rayon yarn stocks, U. S. (P ou nds).....................
Bituminous coal mined, U. S. (T o n s ).................

$




$
$

32,213,000
299,195
8.76
4.63
31,300,000
18,400,000
34,470,000

141,771,927
33,894,137
23.91
72
727,000
$
6,757,976
$
$ 32,347,000
273,351
8.31
4.38
36,700,000
41,100,000
28,665,000

% Change
Year

Month

0
+20
+41
+ 22
—21

— 38

+ 55
+ 4
— 33
... 51
— 66
+26

— 8
+17
— 6
— 3
— 5
— 26
+18

0
+ 9
+ 5
+ 6
— 15
— 55
+20

$
$
' $
$
$

35
486,000
13,635,565
35,117,000
255,264
9.28
4.75
32,900,000
24,900,000
29,135,000

+ 8
+ 6
+ 7
+ 7
+ 45

"o

MONTHLY REVIEW

2

G O V E R N M E N T SECU RITY H O LDIN GS H IG H ER

Circulation o f Federal Reserve notes rose during the
past month as auctioning of tobacco increased and other
fall crops began to come on the market. Member bank
reserve deposits and cash reserves of the Richmond bank
also increased between the middle o f August and the mid­
dle of September. Perhaps the most significant change in
the statement this month is the increase in the bank’s
portfolio of Government securities, due to System pur­
chases of securities in the open market to maintain orderly
conditions 111 the money market following the outbreak of
war in Europe.
RESERVE BANK STATEMENT ITEMS
Fifth District
000 omitted
Aug. 15
Sept. 15
ITEMS
1939
1939
J
200'
$
560
Discounts held ..............................
87
87
Foreign loans on gold...............
23
23
Open market p a p e r ...................
1,043
1,067
Industrial advances ...................
137,064
151,912
Government securities ...............
153,265
Total earning assets ...........
138,801
210,496
Circulation of Fed. Res. notes
202,007
273,187
257,993
Members’ reserve deposits .. .
Cash reserves ................................
398,943
377,097
Reserve ratio ..............................
72.48
74.01

Sept. 15
1938
555
0
23
1,472
127,873
129,921
199,151
221,881
353,254
74.00

$

Industrial plants on the whole were more active in
August than in either July this year or August last year,
and production in bituminous coal mines last month was
higher than in either the preceding month this year or the
corresponding month last year.
Cotton textile mills increased operations in August, and
rayon mills were fully employed except one large plant
which was closed by a strike.
Opening o f additional tobacco markets in North Caro­
lina in August added to the number o f handlers, graders,
etc., at work, but this improvement was lost in September
when markets closed after withdrawal o f buyers for ex­
porters.
The following figures, compiled for the most part by
the Bureau o f Labor Statistics, show the trends o f em­
ployment and payrolls in the Fifth district from July
to A u gu st:
Percentage change from
July 1939 to Aug. 1939
in number
in amount
on payroll
of payroll
+ 2.0
+ 1.4
— 2.2
— 0.7
+ 3.9
+ 4.7
+ 1.9
+ 13.6
+ 2.8
+ 5.6
+ 2.0
+ 2.4

STATES
Maryland ...............
Dist. of Columbia
Virginia .................
West Virginia ___
North Carolina . . .
South Carolina . . .

FU R TH E R RISE IN LO AN S A N D IN VESTM EN TS

Reporting member banks in 12 Fifth district cities in­
creased both loans and investments between August 9 and
September 13, and showed a substantial rise in demand
deposits. Reserves of the 41 banks also were higher on
the later date. Cash in vaults rose seasonally as crop
marketing and early fall trade began.
SELECTED ITEMS— 41 REPORTING BANKS
Fifth District
000 omitted
ITEMS
Sept. 13
Aug 9
1939
1939
Loans & discounts ..............................
$248,637
$245,316
Investments in securities .................
433,539
431,633
Reserve bal. with F. R. Bank _____
183,969
169,311
Cash in vaults ................................
20,411
Demand deposits .................................
521,368
494,508
200,308
Money borrowed

Sept. 14
1938
$234,138
384,509
148,342
19,212
458,960
197,934

M U T U A L SAVINGS CO N TIN U E SU M M ER DECLIN E

Ten mutual savings banks in Baltimore had total de­
posits of $219,426,239 on August 31, 1939, compared with
$219,774,904 on July 31, 1939, and $217,598,810 on A u ­
gust 31, 1938. The small decline last month was a con­
tinuation o f a drop which usually occurs during the vaca­
tion season.
FA ILU RES W E L L BELOW LA ST Y E A R

Commercial failures in the Fifth district and the United
States were reported by Dun & Bradstreet as fo llo w s:
PERIODiS
August 1939 ............. ...........
July 1939 ................... ...........
August 1938 ............. ...........
8 Months, 1939 .......... ..........
8 Months, 1938 ......... ..........

Number of Failures
District U. S.
859
35
35
917
72
1,015
401
446

8,339
9,114

Total Liabilities
District
U. S.
$ 246,000
$ 11,259,000
486,000
14,150,000
727,000
16,382,000
$4,397,000
5,901,000

$119,092,000
170,115,000

DEBITS A T SE ASO N AL L E V E L

Debits to individual accounts in 24 trade centers in the
Fifth Reserve district were approximately the same in
August as in July this year, but exceeded August 1938
debits by 8 per cent. O f the 24 cities reporting for both
years, 12 reported higher and 12 lower figures for August
than for July, while all but 3 cities reported higher figures
last month than for August 1938.
DEBITS TO IN DIVIDUAL ACCOUNTS
Fifth District
CITIES

Aug.
1939

Maryland
Baltimore .............
Cumberland .........
Hagerstown .........
Dist. of Columbia
Washington .........
Virginia
Danville ...............
Lynchburg ...........
Newport News . . .
Portsmouth .........
Richmond .............
Roanoke ...............
West Virginia
Charleston ...........
Huntington .........
Parkersburg .........
North Carolina
Asheville ...............
Charlotte .............
Durham ...............
Greensboro ...........
Raleigh
...............
Wilmington .........
Winston-Salem . .
South Carolina
Charleston ...........
Columbia .............
Greenville .............
Spartanburg
District Totals . .

000 omitted
July
Aug.
1989
1938

% of Change
Month
Year

$ 325,562
7,546
8,030

$ 346,938
8,878
8,962

$ 303,924
7,485
7,717

— 6
— 15
— 10

+
+
+

246,187

266,293

221,504

— 8

+ 11

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

7,380
15,380
9,023
48,264
4,072
143,081
25,853

8,749
13,443
7,683
42,439
3,738
164,377
22,223

+ 24
— 13
+ 6
— 9
— 4
+ 18
— 5

+

7
1
4

5
0
+ 25
+ 3
+ 5
+ 3
+ 11

46,420
15,673
9,607*

45,197
15,440
10,145*

38,701
14,252

+ 3
+ 2
— 5

+ 20
+ 10

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

11,810*
59,292
29,503
18,430
41,713
10,373
37,257

11,707
51,250
46,634
15,556
36,448
11,350
36,658

+ 6
+ 3
+ 40
— 2
— 3
+ 7
+ 9

+ 7
+ 20
— 11
+ 16
+ 10
— 2
+ 11

15,489
27,256
17,710
9,812
$1,218,844

15,757
24,901
18,298
9,653
$1,221,748

13,938
21,738
15,814
7,975
$1,125,303

—
+
—
+

+ 11
+- 25
+ 12
+ 23

2
9
3
2
0

+

8

E M P L O Y M E N T CO N TIN U ES U PW A RD

Specific data on employment are not sufficiently avail­
able to indicate changes from month to month with pre­
cision, but it seems clear that conditions in the Fifth dis­
trict improved during August.




A U T O BU YERS A W A IT N EW MODELS

New automobile sales in August fell below July sales
by somewhat more than seasonal average, but this was
probably due to the expectation o f earlier showing o f new

3

MONTHLY REVIEW
models this year, and to incomplete stocks of new cars
on some dealers’ floors toward the end o f the month.
Stocks o f used cars are not burdensome this fall, and
automobile dealers appear to be optimistic on fall and
winter prospects. The following registration figures for
new cars were furnished by R . L. Polk & Cov o f De­
troit :
REGISTRATION OF N E W PASSENGER CARS— NUMBEIR
STATES
Maryland ...........
Dist. of Col. . . .
Virginia .............
W est V a...............
No. Carolina . . .
So. Carolina . . .
District ...........

Aug.
1939
2,935
1,681
3,636
1,716
3,805
2,067
15,840

Aug.
1938
1,868
1,189
2,269
1,172
3,015
1,390
10,903

% 8 Months 8 Months
Change
1939
1938
+57
26,911
17,667
+41
17,851
11,901
+60
29,489
21,170
+46
15,655
11,295
+26
31,152
20,789
+49
17,397
9,870
+45
138,455
92,692

%
Change
+52
+50
+39
+39
+50
+76
+49

CO N STR U C TIO N DECLINES SE A SO N A LLY

There was a decline in the value o f building permits
issued in August from the high July total, but last month’s
valuation was materially higher than the August 1938
figure. Permits issued in 31 cities in August 1939 totaled
$8,498,125, compared with $13,596,301 in July 1939 and
$6,757,976 in August 1938. Washington reported the
highest figure last month, $2,290,900, Baltimore was sec­
ond with $1,636,990, Raleigh third with $800,283, Rich­
mond fourth with $796,095, and Charlotte fifth with
$425,066.
Contracts actually awarded in the Fifth district in A u ­
gust totaled $32,213,000, a decrease of 8 per cent from
$35,117,000 awarded in July 1939, and also a fraction
below contracts totaling $32,347,000 in August 1938.
However, except for August 1938, last month’s awards
were the highest for any August in this bank’s records
which run back through 1929. Figures collected by the
F. W . D odge Corporation by states for August 1939 and
1938 on construction contracts awarded are as fo llo w s:
CONSTRUCTION CONTRACTS AW ARDED
STATES
Maryland
................................
Dist. of Col................................
Virginia
..................................
West Virginia .......................
North Carolina .....................
South Carolina .....................
Fifth District ...................

Aug. 1939
$ 8,568,000
10,035,000
6,760,000
2,376,000*
3,271,000
1,529,000
$32,539,000*

Aug. 1938
$ 6,650,000
5,553,000
9,751,000
2,205,000*
5,810,000
2,696,000
$32,665,000*

% Change

+
+
—
+
—
—

29
81
31
8
44
43
0

C O TTO N T E X T IL E A C T IV IT Y ROSE 17%

Cotton textile mills in August increased operations
after a seasonal recession during July. Both cotton con­
sumption and actual spindle hours o f operations rose 17
per cent in the Fifth district in August in comparison
with July. Further, with declining cotton prices while
the prices for textiles were firm, mill margins widened in
August. In the first half o f September orders were re­
ceived in excess o f production and many mills are assured
of full time operations for some weeks. Meanwhile mills
have grown reluctant to book further advance orders at
current prices, and therefore today’s quotations are nomi­
nal in many constructions.
Consumption o f cotton by states in the Fifth district
in August 1939, July 1939, and August 1938, in bales,
is shown b elow :
COTTON CONSUMPTION
Fifth District
— Bales—
MONTHS
No. Carolina So. Carolina
August 1939 .........................
163,494
121,535
July 1939 ................................
143,266
100,757
August 1938 .........................
143,560
114,916
8 Months 1939 .......................
8 Months 1938 .......................

1,229,760
964,160

927,332
744,991

Virginia
14,166
11,241
14,875

District
299,195
255,264
273,351

92,956
91,511

2,250^048
1,800,662

R A Y O N IN STRO N G POSITION

In spite o f the absence o f one o f the largest producers
from the market because o f a strike during nearly all o f
August, shipments o f rayon filament yarn during that
month totaled 31,300,000 pounds, only 5 per cent below
32.900.000 pounds shipped in July 1939 and 15 per cent
less than 36,700,00 pounds shipped in August 1938. Ship­
ments o f rayon exceeded production in August, and stocks
declined from 24,900,000 pounds on July 31 to 18,400,000
pounds on August 31. Settlement o f the strike previ­
ously mentioned increased production in September, but
demand for rayon is very strong and on September 19
the largest producer announced an increase in price o f 2
cents per pound. Some o f the mills are restricting orders
for deliveries beyond November until price adjustments
now in process are completed.
CO TTO N PR O D U C TIO N ESTIM ATE RAISED

* Includes some contracts outside 5th district.

C O A L M IN IN G CO NTIN UES A B O V E 1938 L E V E L

Bituminous coal production in August was unusually
high for that month, totaling 34,470,000 net tons, an in­
crease o f 18 per cent over production of 29,135,000 tons
in the shorter month o f July this year and 20 per cent
above 28,665,000 tons mined in August last year. Total
production this calendar year to August 31 of 224,862,000
tons is 11 per cent higher than 1938 production o f 202,666,000 tons for the corresponding months. Increased
production o f coal during the past three months was prin­
cipally to rebuild reserve stocks which were depleted in
April and May, but coal consumption also increased sub­
stantially in industry and reserve stocks have therefore
not yet been replenished.
Shipments of coal through Hampton Roads ports this
calendar year to September 9 totaling 12,546,906 tons
exceeded 11,140,833 tons handled in the corresponding 8
months last year by 13 per cent.




Spot cotton prices, which declined steadily during A u ­
gust, rose again early in September, but failed to hold
all the gain at the middle o f the month. On August 18,
the average price for middling grade upland cotton on 10
Southern markets was 8.95 cents, from which it dropped
to 8.74 cents on August 25. However, by September 8
the average was up to 9.49 cents, and on September 15
stood at 9.18 cents.
The second cotton condition report estimated probable
production in 1939 at 12,380,000 bales, an increase o f
968.000 bales over the August 1 estimate. The unfavor­
able effect o f this marked increase in prospective yield
was lessened by European developments, which may tend
to increase demand for American cotton both at home and
abroad. If the price rise which occurred in September is
maintained, in addition to the higher production indicated
by the September report, farm purchasing power in the
Carolinas during the fall and winter should be very ma­
terially increased.

MONTHLY REVIEW

4
COTTON CONSUMED AND ON HAND
(Bales)
August 1939
Fifth district states:
Cotton consumed ................................
299,195

August 1938
273,351

Cotton growing states:
Cotton consumed ..................................
Cotton on hand August 31 in
Consuming establishments ...........
Storage & compresses ...................

531,632

470,431

494,911
11,777,604

856,529
9,757,925

United States:
Cotton consumed ................................
Cotton on hand August 31 in
Consuming establishments ...........
Storage & compresses ...................
Exports of cotton ....................................
Spindles active in month .....................

628,448

1,059,052
9,825,329
200,843
22,157,528

+ 3
— 30
—
1
+ 12

559,409

653,874
11,805,195
218,792
22,012,186

Individual Cities:
Baltimore, 9 stores . .
Columbia, 3 stores . . .
Richmond, 5 stores . .
Washington, 7 stores

TO B A C C O M ARKETS D E M O R A LIZE D

Auction tobacco markets in the two Carolinas were open
in August and sold 55 per cent more tobacco than in
August 1938, but growers received only 4 per cent more
for their tobacco since average prices were 33 per cent
lower in the 1939 month. Early in September the lead­
ing export buyer retired from the markets because o f
disturbed European conditions, and a few days later all
auction tobacco markets closed to prevent complete de­
moralization o f prices. Sales in August, all o f the fluecured type, were as follow s:
Producers’ Tobacco Sales, Pounds
August 1939
August 1938

STATES
So. Carolina .........
No. Carolina .........
Total
...................

76,832,115
143,091,227
219,924,342

Price per Hundred
1939
1938
$15.96
16.05
$16.02

58,683,790
83,088,137
141,771,927

23.94
$23.91

T O B A C C O PRODUCTS IN CREASE S U B S TA N TIA LLY

All branches o f the tobacco manufacturing industry in­
creased operations materially in August over July, and
output in every line was also higher than August 1938
output. The Bureau of Internal Revenue reports as fol­
lows on August manufacturing:
TOBACCO PRODUCTS MANUFACTURED
August 1939
Smoking & chewing
tobacco, pounds ...............
Cigarettes, number .................
Cigars, number .......................
Snuff, pounds ............................

29,839,260
16,571,041,957
500,807,236
3,451,554

August 1983 c
t
27,504,760
15,891,586,977
477,59*5,984
2,966,448

Change

+ 8
+ 4
+ 5
+ 16

R E T A IL A N D W H O LESALE TR A D E

Same stores by
states, with 24
stores added:
Virginia (13) . . .
West Va. (10) . .
No. Carolina (8) .
So. Carolina (9).

Net Sales
August 1939
compared with
Aug.
July
1939
1938

LINES

Auto Supplies (5)

.........

+20

Drugs (10) .......................
Dry Goods (9) ...............
Electrical Goods (14) . .
Groceries (62) .................
Hardware (20) ...............
Indus. Supplies (10) . . .
Paper & Products ( 7 ) . .
Tobacco & Products (8) .
Miscellaneous (39) . . . .
Totals (189) ...............

+
+

2
3

+ 14
+ 40
+ 2
+ 7
+ 8
— 4
+ 11

+
+

7
7

Stocks
Ratio Aug.
collections
Aug. 31, 1939
compared with to accounts
Aug. 31 July 31 outstanding
August 1
1938
1939

+ 9
+ 82
+ 10
+ 77
0
+ 7
+ 29
+ 17
+ 11

+ i2
+ 6
— 6
+ 41
+ 5
+ 6
+ 8
— 7

— 5
— 1

+ *3
+ 7

+ *1
+ 1

+ 13
+ 15
+ 22

+
+

+
+

+

3
5
4
3
1
0

50
48
83
44
69
87
51
60
60
89
69
66

CROP FORECASTS

The following figures show forecasts o f production
based on September 1 conditions, compared with yields
in 1938 and in the 10-year period 1928-1937, and per­
centage changes in acreage this year over or under 1938.
Yield figures marked ( + ) were raised between August
1 and September 1, and those marked ( — ) were low­
ered.
Cottofn (Bales)

Y Change
c
Acreage
Virginia ............
North Carolina
South Carolina ,

— 15
— 11
0

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

+

Yield
1939

Yield
1938

Yield
1928-1937

12,000
388,000
648,000

40,000
702.000
827.000

29,250,000
98,806,000
2,208,000
516,850,000
98,800,000

25.217.000
98.075.000
3,400,000
493,927,000
79.624.000

18,537,000
34,775,000
12,640,000
46,398,000
26,767,000

15.617.000
32.225.000
12.384.000
41.355.000
21.335.000

1,312,000
1,978,000
1,806,000
5,566,000
10,648,000

1.364.000
2.287.000
2.218.000
3.906.000
8.488.000

543,000
1,138,000
802,000'
863,000
431,000

464.000
916.000
645.000
654.000
338.000

2,990,000
10,349,000
2,720,000
8,690,000
2,784,000

3.257.000
12,352,000
3.109.000
8.028.000
2,476,000

1,040,000
3,570,000
8,748,000
6,468,000

1.156.000
4.285.000
7.896.000
4.965.000

15,000 —
464,000 —
833,000 +

Tobacco (Pounds)

1

+ 16
— 6
+ 21
+ 20

28,804,000 +
126,488,000 +
2,205,000 +
694,550,000—
118,750,000

Corn (Bushels)
Maryland .........
Virginia ...........
West Virginia
North Carolina
South Carolina

+

1

0
1
—
1
— 5

+

17,710,000
36,166,000
13,978,000
47,151,000 —
25,433,000

Oats (Bushels)
Maryland .........
Virginia ...........
West Virginia
North Carolina
South Carolina

+

5

+ 10
— 15

+ 4
+ 7

1,226,000 +
2,020,000
1,460,000 +
5,786,000
11,750,000
Hay (Tons)

Stocks
Aug. 31, 1939
compared with
Aug.
July
1939
1938
+ 3.9
+ 3.9
+ 1.3
+ 15.1
+ 5.4
+ 7.6
+ 9.4
+ 4.6
4- 4.2
+ 9.4

Ratio Aug.
collections
to accounts
outstanding
August 1
30.2
29.2
26.3
25.7
27.6

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

+
+
+

1

+

1

1
1

— 1

503,000
1,010,000 +
688,000 +
820,000 +
475,000 +

Irish Potatoes (Bushels)
Maryland .........
Virginia ...........
West Virginia
North Carolina
South Carolina

— 4
0
— 3
+ 10
+ 17

2,200,000 —
7,031,000
2,790,000 +
8,091,000
3,108,000

Sweet Potatoes (Bushels)
+
+

2.7
4.9

+ 8.1

+ 13.2

+

+

3.0

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

2.2

+ 0.9
+ 16.3

% Change in Sales, Aug. and 8 Months 1939

STATES
Maryland, 9 stores ...........
Dist. of Col., 7 stores . . .
Virginia, 10 stores ...........
North Carolina, 4 stores
South Carolina, 7 stores
District, 37 stores

Compared with
Aug. 1938
+ 3

+12
3
+ 8

+

+ 7
+ 7

+

0
0
0
5

1,120,000 —
3,978,000 —
8,586,000 —
6,900,000

ipples, Commercial (Bushels)

RETAIL FURNITURE SALES




+
+

3
5
2
5

W HO LESALE TRADE, 189 FIRMS

DEPARTMENT STORE TRADE
Net Sales
Net Sales
Aug. 1939
J an. 1 to date
comp, with compared with
August
same period
last year
1938
+ 2.4
Richmond (3) . . .
+ 2.2
Baltimore (8) . . . .
+ 5.1
+ 1.1
+ 4.6
Washington (6) .
+ 8.7
+ 4.1
Other Cities (13)1
+ 6.3
+ 3.1
District (30)
+ 6.4

+
—

Compared with
I Months 1938
+ 3
+ 5
+ 9
+ 9

+ 20

+ 6

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

1,700,000 +
8,000,000 +
4,300,000 +
580,000

1,419,000
7,268,000
3,227,000
480,000

1.331.000
8.153.000
3.576.000
657,000

146.010.000
249.075.000
9,100,000

148.630.000
238.750.000
8,517,000

Peanuts (Pounds)
Virginia ...........
North Carolina
South Carolina

(Compiled September 21, 1939)

181,500,000
279,000,000 —
11,250,000 +

MONTHLY REVIEW, September 30, 1939

FEDERAL RESERVE BANK OF RICHMOND

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

Industrial activity, w hich had increased substantially during the summer,
showed a sharp advance in the first h a lf o f Septem ber a fter the outbreak o f w ar
in Europe. P rices o f basic com m odities and equ ity securities rose sharply while
prices o f high-grade bonds declined.

PRODUCTION

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

DEPARTMENT STORE SALES AND STOCKS

In A ugust, the B oard’s seasonally adjusted index o f industrial production
w as at 102 per cent o f the 1923-1925 average as com pared w ith 101 per cent
reached in July. Volum e o f m anu factu ring production increased fu rther, but
m ineral production declined, ow ing to a tem porary curtailm ent in output o f
crude petroleum. In the iron and steel industry output increased som ewhat
fu rth er in A u gust and rose sharply in the first h a lf o f September, steel in got
production reaching a rate o f 70 per cent o f cap a city in the week ending Sep­
tem ber 16 as com pared w ith about 63 per cent at the begin ning o f the month.
A utom obile production showed about the usual sharp seasonal changes in this
period as the sh ift to new model production w as being made. O utput o f plate
glass increased sharply. Production o f nondurable m anufactures advanced in
A ugust, reflecting chiefly increased a ctivity at cotton and w oolen textile mills.
A t m eat-packing establishm ents activity declined less than seasonally, w hile
at flour m ills, where output has been at a high rate in recent months, there w as
not the usual large seasonal increase. Shoe production advanced seasonally.
A t coal m ines output increased by about the usual seasonal am ount and ship­
ments o f iron ore w ere a t the highest rate o f this season. Petroleum production
declined sharply during the latter h a lf o f A ugust, reflecting shut-downs o f wells
in m ost o f the principal oil producing states, but increased rapid ly in the first
h alf o f September when the wells w ere reopened.
V alue o f construction contracts, as reported b y the F. W . D odge C orpora­
tion, increased somewhat in A ugust, ow in g to la rger aw ards fo r publicly-financed
projects, including several large dams and an increased volum e o f United States
H ousing A dm inistration projects. P riva te residential building showed little
change, although there is usually some seasonal decline. Other private con ­
struction, w hich in Ju ly had been the highest f o r any month in tw o years,
declined in August.

DISTRIBUTION
Indexes of value of sales and stocks, adjusted
for seasonal variation, 1923-1925 average=100.
By months, January 1934 to August 1939.

WHOLESALE PRICES

D epartm ent store sales increased m ore than seasonally from Ju ly to August.
The B oa rd’s adjusted index advanced from 86 to 89 per cent o f the 1923-1925
average and w as at about the level reached in the latter part o f la st year.
Sales at variety stores showed little change in A ugust.
F reigh t-car loadings rose som ewhat fu rth er in August, reflecting chiefly con ­
tinued increases in shipments o f coal and m iscellaneous freigh t.

COMMODITY PRICES
P rices o f most basic foodstuffs and industrial m aterials advanced sharply
in the first h a lf o f September. Prices o f w heat, corn, sugar, cocoa, and v ege­
table oils as w ell as o f hides, rubber, w ool, zinc, and tin showed the largest
increases. The general level o f w holesale com m odity prices as m easured b y the
Bureau o f Labor Statistics index rose 3.1 points and in the w eek ending Sep­
tem ber 9 w as at 78.4 per cent o f the 1926 average, about the sam e level as a
year ago.

AGRICULTURE

Indexes compiled by the U. S. Bureau of Labor
Statistics, 1926=100.
By weeks, 1934 to week
ending September 16, 1939.

Crop prospects showed some im provem ent on Septem ber 1 over a month
earlier, according to the D epartm ent o f A gricu lture. Indications are that p ro­
duction o f all leading crop s except cotton w ill be average or above average in
volume. A cotton crop o f 12,380,000 bales, about 10 per cent below the 19281937 average, is forecast. This com pares w ith a crop o f 11,940,000 bales in
1938 and an estimated w orld consum ption o f 11,265,000 bales o f A m erican
cotton during the past season.

GOVERNMENT SECURITY MARKET
A v era ge yields on long-term T reasu ry bonds, w hich had advanced fr a c ­
tionally since last June, increased sharply by about V o f 1 per cent in the
2
latter h a lf o f August and early September. In pursuance o f the System ’s policy
o f endeavoring to m aintain orderly conditions in the money market, the Federal
Reserve banks during the first h a lf o f Septem ber increased th eir holdings o f
G overnm ent securities by about $400,000,000. On September 1 the Board o f
Governors o f the F ederal Reserve System announced that the F ederal Reserve
banks are prepared at this time to make advances on Government obligations to
member and nonmember banks at par and at the same rate o f discount.

MONEY RATES IN NEW YORK C ITY

BANK CREDIT

For weeks ending January
tember 16, 1939.




6,

1934,

to

Sep­

T otal investments held by reportin g mem ber banks in 101 leadin g cities
declined during the first h a lf o f September. A t N ew Y ork City banks the de­
cline represented the redem ption at m aturity o f Federal F arm M ortgage C or­
poration bonds and at banks in other leading cities it represented the sale o f
T reasu ry bills and bonds. Com m ercial loans o f city banks showed a substantial
grow th during A ugust and the first h a lf o f September.

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