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MONTHLY BUSINESS REVIEW Covering financial, industrial, and agricultural conditions in the Fourth Federal Reserve District Federal Reserve Bank of Cleveland Vol. 12 Cleveland, Ohio, December 1, 1930 Reports received from all parts of the Fourth District indicate that business in general continued in October and early November at the low levels which prevailed in. early fall. Seasonal changes have been shown in some lines but as yet there has been no evidence of a revival in business activity. Department store sales, which showed more than sea sonal improvement in August and September, declined rather sharply in October after allowance for seasonal variations was made. Sales were ten per cent below October, 1929, and in the first ten months o f this year ▼ere nine per cent under the same period o f last year. Activity at automobile parts factories in the latter part of November was somewhat stimulated by new model production by some o f the auto manufacturers, although the volume of orders is still very small. Iron and steel production continues to lag, but operations at Cleveland furnaces increased in November. The industry as a whole is operating at about 45 per cent o f capacity. Tex tile and clothing factories were more active seasonally than a month ago and were among the few groups to show an increase in employment in October. Employ ment and payrolls declined in October and the ratio of demand for labor to applications for work at 13 cities of the Fourth District declined to 40.0 per cent, com pared with 63.2 last year and 67.7 in October, 1928. Building activity in this District, both in October and the first half o f November, showed a greater than sea sonal increase. Although the expansion was shared by residential and non-residential building, the com pari son with form er years is still very unfavorable. Electric power production, despite the seasonal im provem ent and general upward trend, is below last year. Life insurance sales in October were 16 per cent below the same month o f 1929 and the first ten months showed a loss of 0.1 per cent. Commercial failures increased in October, both as compared with September and last year. Liabilities were also greater. Banks report Christmas savings deposits, now being released, almost as large as those paid out a year ago. Crop yields, reported in October, were larger than antici pated a few months ago, but tbey are still much below the average o f past years. Prices continue to sag, al though the rate o f decline has lessened. FINANCIAL Total volume o f member bank credit declined in the month ended November 19, but changes at the Reserve No. 12 bank were relatively unimportant. Money rates declined slightly. Savings deposits at selected banks increased in October and were one per cent higher than a year ago. Reserve Bank Credit. R elatively easy money condi tions are still reflected in the position o f the Federal Reserve Bank of Cleveland. Other than a further sea sonal reduction in gold reserves in the four weeks ended November 19 and a contraction in member bank reserve deposits in the same period, the condition o f this bank is practically unchanged from a month ago. Bills discounted, at $27,905,000 (only $856,000 higher than in October) were still unusually low for this season of the year, in fact lower than for any year since 1924. R eporting member banks in leading cities were borrow ing only $10,000,000 on Novem ber 19. Acceptances have not increased seasonally as much as in past years and were slightly low er than a month ago. The volum e o f government securities owned increased $1,565,000 in the week ended November 19, the first change in this item since early August. These securities have made up the bulk o f this bank's earning assets for the past seven months. Note circulation has changed but little in the past fou r weeks. M ember Bank Credit. In general, changes in bank credit reflected in figures o f weekly reporting member banks in leading cities o f the Fourth District show fluc tuations somewhat similar to the changes occurring in all reporting member banks o f the country, but in the past month the trend o f loans and investments o f the two groups has been opposite except in the case o f collateral FEDERAL RESERVE BANKS Federal Reserve Bank of Cleveland Federal Reserve System ------ (In M illions)------------ (In M illions)------Nov. 19, Nov. 20, Oct. 22, Nov. 19, Nov. 20, Oct. 22, 1930 1929 1930 1930 1929 1980 Gold Reserves............... 295 201 303 3,041 8,042 5,017 Discounts ....................... 28 118 27 206 900 1»2 Acceptances ................. 19 39 20 178 284 177 U. S. Securities ......... 59 16 68 596 827 602 Total Bills and Securities ............................. 106 174 105 985 1.680 977 Federal Reserve Notes in Circulation ......... 184 175 182 1,284 1,925 1,869 Total Deposits ............. 197 178 203 2,614 2,563 2,489 REPORTING MEMBER BANKS Fourth District United States ------ (In M illions)------------ (In M illions)-— Nov. 19, Nov. 20, Oct. 22, Nov. 19, Nov. 20, Oct. 22, 1930 1929 1930 1930 1929 1980 Loans on securities..... 721 748 727 7,888 7,991 8,142 All other loans............. 768 848 769 8,582 9,871 8,678 Total loans ................... 1,489 1,691 1,496 16,690 17,862 16,716 Investments ................. 768 608 788 6,804 5,650 6,667 Demand Deposits ......... 1.086 1,027 1,118 13,974 14,227 13,710 Tima deposits ............... 1,021 927 1,021 7,486 6,722 7,560 THE MONTHLY BUSINESS REVIEW 2 loans. Accompanying the rather sharp decline in stock prices, loans on securities at reporting member banks in this District hare been reduced $24,000,000 in the past two months, although on November 19 they were $3,000,000 higher than on October 29, the lowest point since March. These loans were $27,000,000 lower than one year ago. “ A ll other” loans, including loans made for comm er cial purposes, have fluctuated in rather narrow limits In the past few weeks, the general trend o f the last two months being horizontal instead o f showing the upward tendency that has characterized the fall season o f the m ajority o f the past ten years. At $768,000,000 on November 19, these loans were about at the same level as in October and at the beginning o f September, but were $75,000,000 low er than last year at this time, and, barring the past few weeks, were lower than at any time since early 1928. In the entire country “ all other” loans have been increasing since the beginning o f September. Investments at these same banks in the District have decreased $25,000,000 in the past month and $46,000,000 from the peak o f September 24; on November 19, at $763,000,000, they were still $155,000,000 higher than last year at that time. As a result o f these aforem entioned changes, Fourth District member bank credit extended has declined $31,000,000 in the fou r weeks ended November 19 and has been accompanied by a drop of $38,000,000 in total de posits, practically all of which was in demand deposits. These total deposits were still $150,000,000 larger than in November, 1929, however, while total credit extended has increased only $53,000,000 in the same period. m a n u f a c t u r in g , m in in g Iron and Steel Steel specifications, production and prices in the month ended November 15 continued the gentle but steady de cline which has characterized the market since early autumn. There was a distinct tendency on the part of producers to discount the remainder o f the year and at tempt to put prices on a more stable and remunerative basis. This was accentuated early in November when makers o f steel plates, shapes and bars imparted vigor to their stabilizing campaign, which was instituted in mid-October, and took a stand on 1.60 cents, Pittsburgh, for their products. Their lead was expected to be follow ed by producers of sheets, strip and wire products, in which pronounced weakness developed early in November. The declines in pig iron in October appear to have stabilized this market. Beehive foundry coke was easier at $2.50 to $2.60. A downward movement in scrap prices was also evident in early November, carrying heavy melt ing steel as low as $13 at Pittsburgh. Requirements for new automobile models stimulated sporadic specifications for steel, but as a whole the re leases from the automotive industry declined during the month. Line pipe mills, as for the past few months, operated almost entirely against backlogs. Railroad purchases o f track material, while helpful to order books o f Pittsburgh mills, proved o f little help to current rollings, most specifications being for 1931 de livery. Some assistance, however, was derived from re leases fo r car-building material. Outdoor construction, prolonged by mild weather, resulted in heavier consum p tion o f building steel than anticipated. Low inventories* a strong point when consumption revives, led to slight im provem ent in steelmaking operations at Cleveland in mid-November, contrasted with a slightly easier position in the Pittsburgh and Youngstown districts. Cleveland operations, however, were at the abnormally low rat© o f 44 per cent o f capacity while Pittsburgh and Y oungstow n mills w ere at 45 and 52 per cent respectively. Reflecting the weak price situation, especially in sheets and wire, the market composite o f STEEL declined from an average o f $32.26 in October to $31.86 by N ovem ber 15. This was a reduction of 14 per cent since the begin ning o f 1930, and a new low for the present decade. Steel ingot production in October was at a daily aver age o f 100,756 gross tons, compared with 110,307 tons in September and 167,983 tons last October. F o r the year to date the daily average rate is 136,193 tons, against 174,643 tons in all of 1930. The 35,410,283 tons o f ingots produced in ten months indicates a 1930 output o f about 42,350,000 tons. In record 1930, output was 54,313,845 tons; in 1928, 49,865,185 tons; in 1927, 43.397,743 tons. October's daily pig iron rate was 69,851 gross tons, against 75,893 tons in September and 115,747 tons last October. Total production in October, 2,165,374 tons, brought the ten-month total to 27,910,315 tons, com pared with 36,270,846 tons in the like period o f 1929. Pig iron production in October was at 49.6 per cent o f capacity. Coal Output o f bituminous coal mines o f the Fourth District increased 11.7 per cent in October as compared with Septem ber, which was slightly more than the average increase of the past seven years, but was less than the 1929 September-to-October increase o f 16 per cent and also less than the increase o f 14.8 per cent reported this year for the entire country. Compared with last year, coa l production in the District showed a drop o f 13.9 per cen t fo r October and 9.6 per cent for the first ten m onths o f 1930. Cold weather in October stimulated demand for dom es tic coal, but the gain reported in that month was offset by the drop in orders which accompanied the unusually warm weather o f November. Industrial demand, w hich usually absorbs the lower grades o f coal, has been very much below the average o f past years with a consequent decline in the price of these grades. Stocks o f coal in hands o f industrial consumers on October 1 were smaller than on any corresponding date since 1922, but were seasonally higher than in A ugust o f this year. Consumption o f coal in the third quarter o f this year amounted to 7,370,000 tons a week as against 8,713,000 tons per week in the same period o f 1929, a decrease in 15 per cent. Autom obiles In most recent years there has been a falling-off in autom obile production from September to October, but the decline In the past seventeen years has never been as great as was reported this year. Total production o f passenger cars, trucks and taxicabs reached only 150,044 THE MONTHLY BUSINESS REVIEW units, a drop of 31 per cent from September which, was also a month of very limited production. Barring Decem ber, 1929, when output was sharply curtailed, production in October was the smallest for any month since Decem ber, 1921. The curtailment, although general, was some what accelerated by complete shut-downs in a few cases for new model changes. One of the largest makers of small cars was not producing most of October, but re sumed operations in early November on rather an ex tensive scale. Production of passenger cars has declined to a low er level than has demand, resulting in an im provem ent in the dealer stock situation which was distinctly unfavor able last year and the early part of 1930. New passenger car registrations for the country in the first three quarters o f this year (the latest available) were 30 per cent below the same period o f 1929. Output during this time de clined 38 per cent with a further sharp reduction in October. In the past few months new dom estic passenger car registrations and exports have exceeded production figures, showing that actual absorption has been greater than output. Members o f the National A utom obile Cham ber of Commerce reported dealer stocks as o f October 1 37 per cent below 1929. New Passenger Car Registrations (10 principal counties) % October, 1930 Akron (S um m it).. .. Canton (S ta rk)........ Cincinnati (Hamilton) Cleveland (Cuyahoga) Columbut (Franklin) Dayton (M ontgom ery) Pitttburgh (Alleghy.) Toledo (L u ca s)......... Wheeling (O h io). . . . Youngstown (Mahoning) T o ta l...................... 340 220 804 1,577 462 267 1,664 324 84 222 5,964 % change from 1929 Jan.-Oct., 1930 — 5 4 .S — 55.8 — 4 0.4 — 4 6.9 — S2.3 — 60.3 — 4 0 .0 —4 8 .7 — 50.0 — 64.4 — 4 7.7 7,702 4,732 13,642 31,597 8,557 5,862 30,963 6,359 1,532 4,484 115,450 change Jan.-Oct., from 1929 1929 14,932 9,226 19,015 47,524 14,316 10,524 36,949 13,116 2,343 8,366 176,311 — 48.4 — 4 8.7 — 28.3 — 33.5 — 40.1 — 44.3 — 16.2 — 51.5 — 34.6 — 46.4 — 34.5 Truck manufacturers, although sharing in the decline, have not curtailed output to the extent that passenger car production has been reduced. Output in October was 37,244 units, compared with 41,157 in September and 60,687 in October, 1929. The decrease from a year ago was 38.5 per cent. Production in the first ten months was down 32 per cent. Makers of autom obile parts and accessories, located in this District, reported a slight increase in orders for ma 3 terial in October and November, all of which was sea sonal and was in preparation for new model introduction in several cases. R ubber, Tires In the past year world stocks o f crude rubber have increased steadily each month except May, 1930 when the tap ping holiday tem porarily retarded production. The cause of these generally increased stocks has been reduced consumption rather than increased output. Total world stocks o f rubber on September 30, according to the De partment o f Commerce, were 470,000 long tons com pared with 310,730 tons last year, an increase o f 51 per cent. Proportionately more of this rubber has found its way to the United States than to other countries, stocks on hand on October 31 amounting to 184,701 tons as against 88,483 tons on the same date last year, an increase of 108 per cent. This large increase in total stocks has had a very de pressing effect on the market, the average price in Octo ber being 8.10 cents a pound as against 19.41 cents in October last year and 22.4 and 37.9 cents the average yearly price for 1928 and 1927. Current prices are lower than production costs and now that the possibility o f governm ent restriction of output has definitely been removed, an econom ic adjustm ent between production and demand would seem to be the only solution. Some o f the plantations began to curtail tapping some months ago be cause o f the low price, particularly in the Dutch East Indies, but many o f the large estates in the Malay States, Ceylon, India and British Borneo up to August showed larger outputs than one year ago. Consumption o f crude rubber by United States manu facturers in October totaled 27,271 tons, an increase o f eight per cent over September, but considerably below last October's consumption o f 34,800 tons. Imports in October, at 43,729 tons continued to exceed consumption. P roduction o f tires in September (the latest available) was 24.7 per cent below last year and 24 per cent below August, but shipments exceeded production by 31 per cent, resulting in a further reduction o f inventories to the lowest fo r any month since September, 1928. Employment at rubber plants in October showed slight ly more than the average decline of fou r per cent recorded for the past five years. Clothing Textile and clothing factory operations were among the few to show an in crease in October. Employment at 39 concerns increased two per cent from September, 24 firms contributing to the expansion, while 14 reported a decline and one no change from a month ago. This was the second month to show an increase, the rate of gain being greater than was reported last year. The general level is still 16 per cent below October, 1929 and some fac tories are only on a part-time schedule. This is usually the most active season o f the year for the clothing industry, operations being accelerated by re orders o f winter goods and orders for spring delivery. Salesmen are now out meeting the trade, but orders are being received in reduced volum e from last year at this time which was also a poor season. Retailers are buying below what was form erly their normal requirements. The 4 THE MONTHLY BUSINESS REVIEW unusual degree of unemployment has created a feeling o f fear and uneasiness in the minds o f many people and extreme economy is being practiced on all sides, particu larly with regard to clothing purchases. Retailers see ing the effect o f this cautious attitude have reduced their commitments which is reflected in smaller stocks. At department stores in this District stocks of wom en's coats and dresses were 16 and 22 per cent smaller respectively than one year ago, while men’s clothing was down 10 per cent. Part o f this decrease is accounted for by the lower level o f prices, but much o f it is due to actually smaller stocks. The few orders that are being placed are for immediate delivery. The entire cotton textile industry showed further im provement with regard to inventories in October. P ro duction, although slightly above September, was kept be low shipments and unfilled orders also increased to the highest level since April. Other M anufacturing General manufacturing activity in the Fourth District continues very irregu la r with declining operations still pre dominating. Employment, in general, decreased further in October and the ratio o f demand for labor to applica tions fo r employment fell more than seasonally in thir teen m ajor cities of the Fourth District, despite the low level that has prevailed this year. Of the eleven m ajor manufacturing groups, only three showed an increase from September, two o f which were greater than the aver age o f the past five years. One group showed a smaller than average decline. In Ohio, 886 firms reporting to the Ohio State Bureau o f Business Research, reported a deerease o f three per cent from September, in contrast with an average one per cent increase shown in the five years, 1925*29. Canning. The canning industry appears to be feeling the effects o f depression just as most other lines. The late, open season enabled canners to pack more tomatoes than last year and the corn pack is estimated to be only about 10-12 per cent short o f 1929. These larger than anticipated packs have weakened the market generally. So far as can be determined stocks on retailers shelves are smaller than usual, but buying is still only for pres ent needs. Olay Products. Employment in the stone, clay and glass products industry increased one per cent in October, in contrast to stability shown from September to October in 1925-29. The present level is still 20 per cent below last year and 23 per cent below the 1926 m onthly average. Demand for window glass showed sea sonal im p r o v e m e n t in the past month, but it is still far from normal. Sales o f all window glass manufacturers in the first nine months o f 1930 were about 23 per cent below 1929 and 46 per cent less than in the corresponding period o f 1928. It is reported that stocks in hands o f manufacturers and dealers have been decreasing slowly. E lectrical Supplies. Stimulated by the advance in cop per prices, ofders fo r electrical supplies and equipment increased in November. Except for copper, inventories, particularly o f finished goods, are very low. Employment declined sharply in October and was over 20 per cent below last year. Hardware, Machinery. Operations in this industry in October continued the decline which started last spring, the drop in employment for the month being eight per cent. Of 106 concerns, 69 reported declines, 32 increases and five no change from September. Demand generally is very much below normal and the few orders that are placed are for immediate delivery. The fourth quarter is usually the dullest o f the year, and to this extent 1930 has not varied from past periods. Paint. Stocks of paint are reported smaller than in periods of normal activity, but dealers are showing con siderable hesitancy about restocking and current sales are much below one year ago. This is norm ally the d u ll est season of the year with building paint in little demand but industrial orders have also receded sharply. Paper. Production of paper mills in October was slightly higher than in September, but em ploym ent was unchanged. Orders received have shown a slow ly rising tendency in the past few weeks, October sales o f one large concern being ten per cent ahead o f September. Stocks in distributors’ hands are reported low. Shoes. Shoe production in October, both in the F ourth District and the entire country, declined from Septem ber in contrast to the increase shown at that time in 1928 and 1929. Output of 50 factories was 9.5 per cent small er than in September, considerably larger than the de cline of 4.6 per cent reported for the entire country. Last year the September-to-October increase was 10 per cent in this District. Comparison with corresponding periods o f 1929 is very unfavorable, output in the past month being 35.6 per cen t below October, 1929, and production fo r the first ten months showed a drop o f 22.3 per cent. Manufacturers at Cincinnati reported business at unusual ly low levels with very little buying being done. H ide and leather prices continue to drift downward, but the generally lower level has had no favorable effect on the shoe business. Stove and Sheet Metal. Employment at sheet m etal and stove and equipment factories declined only fra c tionally in October, but was more than 20 per cent below last year at that time. More concerns reported increases than decreases, but buying is at a very low level. W atches, Jewelry. Seasonal changes have been noticed in volum e o f sales, but general level is subnormal. Deal ers are buying much more conservatively than in past pre-holiday seasons. BUILDING Building activity in this territory in the first half o f Novem ber was proportionately greater, as com pared with October, than in the entire country. Contracts awarded averaged $2,022,800 a day for the first three weeks as against a daily'average o f 11,865,700 in the entire m onth o f October and $1,070,100 in November, 1929. In the 37 eastern states the daily average o f contracts let in this same period was seven per cent smaller than the THE MONTHLY BUSINESS REVIEW daily average of October and 23 per cent below the daily average of November, 1929. The average decline from October to November in past years was 13 per cent. October contracts awarded in the Fourth District were decidedly ahead of September, both in residential and non-residential lines. Total contracts awarded in Oc tober amounted to $41,342,000 as against $34,268,000 in September, an increase o f 21 per cent. In only two of the past ten years, 1920 and 1925, have larger September-to-October increases been reported and seven or the ten years have shown decreases for the period. The comparison with preceding periods is still very unfavor able, total building for the first ten months being 23 per cent below the same period of 1929, with residential building registering a drop o f 34 per cent. Contracts awarded for residential construction amounted to only $7,872,000 in October, which brought the total for the ten-month period to $94,752,000. Lumber dealers report little change from one month ago. A few reported an increase in inquiries, but actual orders are very scarce. Prices continue to show little re sistance to the downward movement, the stabilizing ef forts being more effective in the western states than locally. TRADE Retail Fourth District department store trade, Trade after increasing more than seasonally in August and September, showed rather a sharp decline in October. Sales at 55 stores, on a dally average basis, increased less than the usual sea sonal amount and the adjusted sales index declined from 98 in September to 91 in October. Sales at all cities except Cleveland were larger in October than in September, but compared with October, 1929, rather wide variations are noticed. Declines o f one per cent were shown at Cincinnati, four per cent at Pittsburgh, eight per cent at Columbus and W heeling, 15 per cent at Toledo, 16 per cent at Cleveland and 21 per cent at Akron. Although stocks have been increasing for the past two months in preparation for Christmas selling, the dollar volume on October 31 was 13 per cent below one year ago. Part of this decrease is due to lower retail prices, but much of it represents a real contraction in stocks. The stock turnover rate for October was the same as one year ago and for the first ten months was 2.75 as against 2.78 in the same period o f 1929. 6 The ratio of installment sales to total sales at depart ment stores in this District has been showing seasonal fluctuations and in October, at 5.9 per cent, was only slightly higher than in 192 9 when it was 5.6 per cent. Collections on these accounts have been well main tained. The ratio o f all credit sales to total sales is about . the same as in 1929 and collections have held up quite well, the ratio o f collections during October to accounts outstanding on September 30 being 34.9 this year as against 36.8 one year ago. W holesale Trad© All reporting lines o f wholesale trade except drugs and shoes showed some seasonal im provem ent in October, but in most cases this was less than has been experienced at this season o f past years. Compared with October, 1929. large declines are reported in all branches of trade, drugs being off 13.7 per cent, dry goods, 20.4, groceries, 16.9, hardware, 21.9 and shoes 31.5 per cent. The drop in grocery sales was unusually large, increasing the dis crepancy between the first ten months o f 19 30 and the same period o f 1929 to 6.4 per cent. Stocks in all lines except groceries were lower than in 1929 and collections have shown a sharper falling-off than have accounts re ceivable. AGRICULTURE Harvesting of late crops has been com pleted in this District, but final crop figures are not yet available. The November report of the Department o f Agriculture showed rather general improvement in yields o f 44 m ajor crops, the harvest of the country increasing 0.8 per cent for the month. In spite of this, yields per acre are still expected to be 5.4 per cent below the rather low yields o f last year and 8.9 per cent below the average yields o f the preceding ten years. In Ohio, crop yields increased 2.5 per cent in October, but were over 20 per cent below the ten-year average. In Pennsylvania the increase for the month was 1.9 per cent, with prospective yields 14 per cent below the 1919-28 average. Kentucky and W est Virginia also reported im provement in the month, but total yields were over 40 per cent below the preceding ten years. Yields in the Fourth District were above the expecta tions of a month ago. The corn crop which has nearly all been husked, was estimated to be 109,408,000 bushels as against last year’s harvest of 170,082,000 bushels, and 184,000,000 bushels, the average harvest o f the past five years. Potatoes also im proved and are yielding better than was expected in all parts o f the District. The No vember 1 estimate was 17,094,000 bushels as against 19,695,000 bushels in 1929, a drop o f 13 per cent. In the entire country the potato crop was estimated to be 2.4 per cent larger than in 1929, but 6.2 per cent below the average production o f the previous five years. The apple crop is also larger than was anticipated a month ago, but is still below the ten-year average. The quality o f grapes is the highest since 1923 in Pennsyl vania, but three points below average in Ohio. Y ield in both states, while about six points below average, was considerably better than in 1929. One o f the m ost discouraging factors in the entire agricultural situation is the water shortage, still acute 6 THE MONTHLY BUSINESS REVIEW in most sections. The drought, which has prevailed all year, was not mitigated to any extent by the rains in Sep tember. Farmers in many sections are hauling water, both for livestock and household use and pastures and fall-sown grains are in very poor condition. W heat in some sections has been maintained by the little surface moisture, but in other sections seed was not up four to six weeks after planting. Prices The rise in the index of the price of farm products which occurred in Sep tember proved only a temporary im provement, for, a drop from 111 in September to 106 per cent o f the five-year average 1909-14 occurred in October. At this point the index compared with 140 in October, 1929, a drop for the year of 24.3 per cent. It was also the lowest for any month since February, 1916. The chief cause of the extreme drop in the past year was the sharp declines in grains, cotton and cottonseed. The index o f the form er dropped from 128 in October, 1929, to 92 this year, while the latter fell from 141 to 76 per cent of the pre-war average in the same period. A comparison of other com m odity prices reveals that the farm producer has not been the only one affected, but the drop in the past year in the price o f non-agricultural products has only been 12.2 per cent. On the other hand, the drop in the prices paid by farmers for goods has only been about four per cent, so that the ratio o f the prices received to prices paid dropped from 90 last year to 71 in October, 1930. This sequence has follow ed in previous periods o f fall ing prices. Farm products and raw material prices have declined faster and farther than manufactured goods and both have receded faster than retail prices. Tobacco Interest in the tobacco sections of th is District is now centered on the market opening in early Decem ber; all grow e rs and warehouse men are anxiously awaiting to see w h a t prices will be offered on the loose-leaf floors, as to the probable price of the market opening, nothing ca n be said with certainty, but a review o f the flue-cured markets in the southeastern states, which opened earlior, may throw some light on the situation. A ccording to the Georgia State Department of Agri culture, 106 million pounds o f tobacco were sold at an average o f 9.86 cents a pound. This compared with 91 million pounds at 18.37 cents in 1929. In North Caro lina sales in October reached 158 m illion pounds at tin average of 14.92 cents a pound, as against 155 million pounds last year at 19.91 cents a pound. W hile the average auction price in these two districts has been considerably below last year, much o f the dis crepancy can be attributed to the low er average Quality o f the crop. Prices on certain o f the better grades ap pear to be fully as high as in 1929, but the poorer grade tobacco, of which there seems to be an abundance this year, has been substantially lower-priced. Last year the burley crop brought, on an average, 21.7 cents a pound. The present supply o f burley tobacco (stocks in hands of dealers and this year's crop ) is ju st about the same as one year ago, the large increase in carryover being offset by the drop in production. The determining factor in the price obtained w ill undoubtedly be the quality o f the crop, on which opinion is divided. A bout 25 per cent of the burley crop was cut prior to the fall rains. Much of this is o f good quality, but very light weight, so that per acre return will be reduced. The late-cut burley, in general, is of mediocre quality, and some seems to have cured green. The drought has not yet been broken and because of the dry weather little tobacco has been stripped. The latest estimate o f the Department o f A griculture showed rather a large increase during October in total burley tobacco production. On Novem ber 1 the total burley crop was estimated at 305,089,000 pounds as against 334,619,000 pounds harvested in 1929. The Ken tucky burley crop, however, does not make such a favor able showing, being estimated at 202,300,000 pounds as against 242,440,000 pounds harvested in 1929. Other types raised in this District show up more favorably than burley, and the tobacco crop for the entire country waa estimated at 1,518,781,000 pounds as compared with 1,519,081,000 pounds last year, and 1,302,463,000 pounds, the average annual harvest of 1924-1928. THE MONTHLY BUSINESS REVIEW Fourth District Business Statistics Fourth District Business Indexes (1923-1925 = 100) (000 omitted) K% change change Jan.-Oct., Jan.-Oct., from October, from 1930 1929 1929 1930 1929 Fourth District Unless Otherwise Specified Bank Debits—-24 cities. . .$ 3,144,000 — 21.8 31,353,000 36,134,000 — 13.2 Savings Deposits— end of month: 772,7471 771 ,97 1 *+ 0.1 Ohio— 35 banks................$ 783,200 + 1-3 277,4911 276,910*- f 0 .2 Western Pa.— 24 banks . . $ 279,283 1. 6 Total— 59 banks...............$ 1,062,483 + 1.4 1,050,2381 1 .0 4 8 .8 8 H + 0 .1 Life Insurance Sales: Ohio and Pa...................... $ 94,409 — 16.0 1,136,185 1,137,952 — 0 .2 Retail Sales: Department Stores— 57 firms........................... % 224,693 246,823 — 9 .0 26,580 — 10.0 Wearing Apparel— 16,099 — 10.1 16 firms............................ 3 14,481 1,747 — Furniture— 51 firms........ J5 12,743 — 33.8 8,440 772 — 4 3.7 Wholesale Sales: Drugs— 13 firms............... $ 15,976 17,873 — 10.6 1,592 — 13.8 19.249 — 19.8 Dry Goods— 10 firm s... .$ 15,444 1,898 — 20.4 59,271 Groceries— 41 firms......... $ 63,296 — 6 .4 6,354 — 16.9 f Hardware— 17 f i r m s . ... .$ 21,900 — 17.6 18,040 1,974 — 21.9 Building Permits— 27 cities........................... £ 182,692 — 24.2 138,469 15,092 — 25.3 Building Contracts— Residential...................... $ 144,474 — 34.4 94,752 7,872 — 35 . 3 Building Contracts— Total— All Classes...................... $ 567,829 — 23.3 435,759 41,342 — 44.4 Commercial Failures— 35,627 30,010 + 1 8 .7 Liabilities.........................$ 3,476 — 3.5 1,5 6 32 + 6 .7 Commercial Failures— N o.. 1852 + 4 0 . 2 Production: 27,867 36,267 — 23.2 Pig Iron, XJ. S............ tons 2,165 — 39.7 Steel Ingots, U. S.. ..ton s 35,410 47,888 — 26.1 2,720 — 4 0.0 2,592,0222 4,310,954a— 39.9 Automobiles— Pass. U. S. 112,2092— 64.8 473,834a 695,4263— 31.9 Automobiles— Trucks, U. S. 37,2443— 38.5 Bituminous C oal........ tons 173,542 — 9 .6 17,466 — 13.9 156,846 >•Cement — O., W. Pa., 14,208 + 1 0 .1 P W. V a.......................bbls. 15,643 1,655 — 4 .4 Elec. Power— 11,2214— 3.5 O., Pa., K y ........k.w.h. 10,8234 1,164s—4 1 . 3 Petroleum— O., Pa., Ky. 1 9.0894+ 8.4 20,6904 ....................................bbls. 2,067s— 7, & s — 22.3 Shoes............... ........ pairs 5 —35 33,6724 46,4564— 27.5 Tires, U. S........ . casings 2,706s— 24 Bituminous Coal Shipments: Lake Erie Ports. . . . tons 34,441 34,713 — 0.8 4,575 — 7.2 Iron Ore Receipts: Lake Erie P orts........ tons 30,251 42,628 — 29.0 4,011 — 33.7 'M o n th ly Average ry-Sept 4 January-September * Actual Number •^Confidential ■September + 12.0 1,6683 Wholesale and Retail Trade (1930 compared with 1929) (57) D E P A R T M E N T STORES A kron................................................... Cincinnati........................................... Cleveland............................................ Columbus............................................ Pittsburgh.......................................... T o le d o ................................................. W heeling............................................. Other Cities....................................... District................................................ W E A R IN G APPAR E L Cincinnati........................................... Cleveland............................................ Other Cities....................................... D istrict................................................ F U R N IT U R E Cincinnati........................................... Cleveland............................................ Columbus........................................... D a vton ................................................ T o le d o................................................. Other Cities....................................... D istrict................................................ C H AIN STORES* Drugs— District (4 )...................................... Groceries— District ( 6 ) ................................ W HOLESALE G R O C E R IE S (41) A kron............................................................... Cincinnati........................................................ Cleveland......................................................... Erie.................................................................. Pittsburgh....................................................... T oled o.............................................................. Other Cities..................................................... D istrict............................................................ W HOLESALE D R Y GOODS W HOLESALE DRU GS ..................... W HOLESALE H A R D W A R E W HOLESALE SHOES ( 5 ) ........................ •Sales per individual unit operated. (16) (51) (10).......... (13) (17)......... Percentage Increase or Decrease STOCKS SALES SALES Oct.,First Oct.,Oct. ten Oct. Months — 17.0 — 19.2 —21.2 — 10.3 — 2.3 — — 16.1 — 11.7 — 15.7 — 8 .9 — 2.5 — 7. 6 Oct., Oct., Oct., 1930 1929 1928 116 148 136 127 90 111 79 36 54 113 134 130 (55 106 118 112 (13 102 118 114 86 109 106 (10 (41 97 113 109 (15 83 107 103 (82)t................................ 94 115 111 (3 87 89 90 87 156 120 46 71 102 97 112 106 138 144 176 139 156 135 112 120 105 74 115 120 (24 Bank Debits cities)......................................... Commercial Failures (N u m ber)........................ (Liabilities)..................... Sales— Life Insurance (Ohio and P a .)............... “ — Department Stores firm s)............... “ — Wholesale Drugs firm s)................... “ — " Dry Goods firm s)......... — “ Groceries firms)............. “ — “ Hardware firm s)........... “ — “ All — Chain Drugs firm s)**......................... Building Contracts (T o ta l)................................ (Residential)..................... Production— Coal (O., Wn. Pa., E. K y .)........ — Cement (0 ., W. Pa., W. V a .). . . — Elec. Power (O., Pa., K y ,)* . • ■. — Petroleum (O., Pa., K y .)* ........... — Shoes................................................ ♦September **Per individual unit operated, flncludes shoe firms. Oct., Oct., 1927 1926 119 116 120 114 159 58 108 108 113 118 111 111 98 111 102 110 108 112 106 114 96 104 103 113 101 93 87 118 145 149 121 125 110 104 114 112 3 Debits to Individual Accounts (Thousands of Dollars) 4 weeks % Year-to- Year-to% ending change Date, Date, change Nov. 19,from (Dec. 31,1929 (Tan. 2, 1929 from 19301929 Nov. 19,1930) Nov. 20,1929) 1929 Akron.............................. 76,531 —29.9 1,045,566 1,285,082 —18.6 Butler............................. 11,840 — 18.6 138,300 141,099 — 2.0 Canton........................... 34,690 —29.5 483,365 593,001 —18.5 Cincinnati...................... 327,242 —33.3 4,011,034 4,845,511 —17.2 Cleveland....................... 699,146 —30.0 8,690,631 10,107,696 —14.0 169,084 — 8.7 1,958,020 2.046,273 — 4.3 Columbus...................... D ayton........................... 65,536 —34.5 964,583 1,157,842 —16.7 Erie................................. 30,265 —28.7 420,267 444,348 — 5.4 Franklin......................... 3,965 —36.7 54,360 66,110 — 17.8 Greensburg.................... 18,779 — 3.5 207,572 228,290 — 9.1 Ham ilton........................ 11,088 —35.8 154,062 187,987 —18.0 Homestead.................... 3,789 —35.0 48,895 54,944 —11.0 Lexington........... 19,152 — 17! 1 264,440 301,112 —12.2 Lim a................................ 10,238 —25.6 133.605 169,828 —21.3 5,277 — 11.4 62,274 69,993 — 11.0 Lorain............................. Middletown................... 8,738 —31.3 116,720 141,315 —17.4 Oil C ity......................... 14,136 —27.8 177.657 211,756 —16.1 863,314 —29.7 10,610,5 57 12,018,392 —11.7 Pittsburgh..................... Springfield..................... 17.003 —24.5 240,690 263,954 — 8.8 Steubenville.................. 8,066 —28.9 109,976 136,442 — 19.4 Toledo............................ 149,238 — 35.4 1,932,947 2,467,301 —21.7 W arren........................... 9,613 — 28.1 125,686 165,676 —24.1 Wheeling........................ 36,698 —29.4 468,594 557,928 — 16.0 Younsrstown.................. 53,610 —34.2 730,911 871,558 —16.1 Zanesville....................... 8,982 —28.9 108,039 140,595 —23.2 T otal........................... 2,656,020 —29.5 33,258,751 38,674,033 —14.0 1.0 — — — — — — — — — 4.1 15.4 7.8 17.2 10.0 10.8 14.9 10.4 1 2 .0 24.4 49. 0 — 34.7 — 43 .4 — 53.4 — 34.2 — 43. 7 — — — — — — — — — — — — — — — — 4.7 2.1 31.8 9. 9 24.2 14.5 11.2 13.5 11.1 16.9 20.4 13.7 21.9 31.5 — — — — — — — — 5. 4 17.4 10.5 13.8 9 .0 7.7 13.8 8.4 —10.1 — — — — — — — — — — 10.4 — 15.6 — 14.9 — 10.5 — 7.4 10.0 — — 9 .2 25.3 33.2 30.5 26.6 49.0 34.7 33.8 1.8 1.2 1. 1 11.5 6.2 4. 9 — 5.0 — 0 .9 — 6.4 — 19.8 —10.6 — 17.6 — 31.3 (Value of Permits) % 12.6 — —20.6 — Building Operations —10.2 — — — - 0 .3 - 12.0 -1 6 .3 -5 6 .9 October, .............................. ...................... ...................... ............................ ...................... ....................... ............. ................. ......................... .. . .................. ......................... ............ ........ ....................... ............. ........................... .......................... ........................ ............... ................................ ........................... .............. ...................... ............................. ......... .................. ........................... A kron Ashtabula Barberton C an ton C incianati Cleveland Cleve. Suburbs: Cleve. H ghts East C leve E uclid Garfield Heights. L akew ood Parm a R ocky R iver Shaker Heights Colum bus Covington, K y D a y to n Erie, P a H am ilton Lexington, K y Lim a N ew ark Pittsburgh, P a Springfield T o le d o Wheeling, W. V a Y oungstow n T ota l 1930 355,310 25,698 9,205 83,857 3,491,265 7,073,175 81,450 12,685 62,905 23,500 64,517 105,820 51,700 323,235 949,000 70,800 291,109 356,860 67,763 171,611 9,914 2,725 806,088 51,345 224,405 75,606 250,700 15,092,248 change from 1929 —69.4 — 41.2 —79.0 —67.6 —23.3 +25.3 —43.1 —92.0 —61.4 —69.7 — 11.0 — 40.9 — 35.1 —44.0 —27.9 —62.0 —71.1 +18.8 —88.4 + 20.9 —50.8 —94.4 —60.6 +46.8 —75.5 + 5.9 — 31.6 —25.3 Jan.Jan.Oct., Oct., 1930 1929 9,020,974 16,221,788 314,621 574,527 219,367 945,932 1,364,864 3,266,980 36,118,777 32,940,945 29,306,050 35,045,600 2,433,080 788,131 1,288,566 509,300 1,414,352 1,248,919 996,953 4,644.135 5,151,150 606,450 4,525,843 3,837,073 1,125,564 1,065,310 495,927 230,760 18,110,842 726,475 9,322,464 1,016,653 2,586,089 138,468,689 2,267,140 1,803,400 2,185,347 1.108.850 1,379,507 2,294,978 1,381,378 5.648.850 9,866,550 1,312,025 5,869,220 5,848,661 1,948,870 1,962,882 390,665 627,480 27,628,884 1,693,191 12,765,097 1,381,986 4.331.648 182,692,381 change from 1929 —44.4 —45.2 —76.8 —58.2 + 9.6 —16.4 + 7.3 — 56.3 —41.0 —54.1 + 2.5 —45.6 —27.8 — 17.8 —47.8 —53.8 —22.9 —34.4 —42.2 —45.7 + 26.9 —63.2 34.4 —57.1 — — — — 27.0 26.4 40.3 — 24.2 THE MONTHLY BUSINESS REVIEW 8 Summary of National Business Conditions By the Federal Reserve Board 1 tNDUSTfTIAL PRODIUCTI0N A\ / \ ------- ^ -------------- 1 1926 1530 Index number o f production of manufactures and minerals combined, adjusted for seasonal variations (1923*1925 = 100) Latest figure October, 88. meTORY DdPUCYMIENT ANID F*YR<DLLS tA A f*\ » V‘ J Vv f v CM ptm 1925 1926 V olum e of Industrial production and factory employment declined in October, and there was a further downward movement o f com m odity prices. Volume o f sales by department stores increased by m ore than the usual seasonal amount. There was a considerable inflow o f gold from South Am erica and the Orient, and a further slight easing o f m oney rates. 1027 1928 k 1929 v\ 1930 Index numbers o f factory employment and payrolls, without adjustment for seasonal vari ations. (1923-1925 average = 100). Latest figures October, employment, 84.3, payrolls, 80.8. Production and Employment Industrial production, including both factories and mines, decreased by about three per cent in October, according to the Federal Reserve B oard's index, which makes allowance for usual seasonal changes. This decline reflected chiefly a further decrease in output o f steel ingots, contrary to the usual seasonal movement, and a larger than seasonal decline in the output o f automobiles. Output in the shoe industry was also curtailed. Consumption o f cotton by domestic mills showed a further increase o f slightly more than the usual seasonal amount, and stocks o f cotton cloth were further reduced; increased activity was also reported for the silk in* dustry. Output o f coal was in substantially larger volume than In Septem ber, while production o f copper and petroleum declined. Number o f workers employed showed a decrease for the m onth in foundries and in the automobile, machine tool, woolen, and shoe industries while increases were reported in number of persons employed In the pro^ duction o f silk goods, hosiery, and radios. Employment at coal mines in creased considerably, partly in response to seasonal influences. Value o f contracts for residential building, as reported by the F. W . Dodge Corporation, which had shown a growth in September, increased further in October, but by an amount smaller than is usual for that m onth. Contracts for public works and utilities also increased somewhat, reflect ing a larger volume o f awards for pipe lines. Owing to a substantial de crease in contracts for industrial building, however, there was little change in the total value o f building contracts awarded. Distribution Volume o f distribution o f commodities by rail showed a decline from September to October. R etail trade, however, as indicated by sales o f de partment stores, increased by considerably more than the seasonal am ount, according to preliminary reports to the Federal Reserve System. W holesale Prices The general level o f wholesale prices, as measured by the Bureau o f Labor Statistics Index, declined In October, and the decline continued In the first half o f November. Further decreases in the prices o f many agri cultural products, including grains, livestock and meats, were accom panied by reduction in the prices o f hides, tin, petroleum and gasoline, w hile sugar and copper a d v a n c e d . The price o f cotton rose considerably at the end o f October from the low level prevailing early in the month Indexes o f the United States Bureau of Labor Statistics, (1926 = 100, base adopted by Bureau). Latest figures October, farm products, 82.6, foods, 88.6, other commodities, 81.5. Bank Credit Total volum e o f credit at reporting member banks in leading cities showed relatively little change for the four-week period ending Novem ber 12. Loans on securities declined further by $350,000,000 reflecting re ductions in loans to brokers and dealers in securities, while all other loans increased by $ 1 5 0 , 0 0 0 , 0 0 0 , partly on account o f purchases o f acceptances by the member banks. The banks also increased their holdings o f invest ments. The volume o f reserve bank credit in use showed little change between the middle o f 0 c *0ker and the middle o f November. There was a further addition o f $30,000,000 to the stock monetary gold and a decline o f $ 2 0 , 0 0 0 , 0 0 0 in money in circulation, while member bank reserve balances increased. No material change in the composition o f the reserve bank port folio was shown for the month. Monthly averages of weekly figures for report ing member banks in leading cities. Latest figures are averages of first two weeks in November Money rates in the open market have eased slightly since the m iddle o f October. The rate on prime comm ercial paper declined from 3 per cent to a range from 2 % to 3 per cent and there was a reduction in the rate o f bankers' acceptances o f the longer maturities. Long time money rates as measured by yields on United States Government securities, declined slightly.
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