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MONTHLY BUSINESS REVIEW
Covering financial, industrial, and agricultural conditions
in the
Fourth Federal Reserve District
Federal Reserve Bank o f Cleveland
Cleveland, Ohio, March 1, 1932
Vol. 14
General business in this District exhibited no marked
change in the latter part of January or the first three
weeks of February. Although slight increases, chiefly
seasonal, were reported in a few industries, little actual
improvement has been made, though no great tendency
to decline was evident.
From all sections, however, come reports of better
sentiment. Recent legislation no doubt was responsible
for a large part of this betterment and anxiety concern
ing financial conditions has lessened.
The number of
bank suspensions was much smaller in February than
in preceding months and there also was a reduction in
the rate of deposit withdrawals at member banks.
The shoe industry increased operations in January at
a greater-than-seasonal rate, output in the month be
ing 6.4 per cent above one year ago. Clothing concerns,
particularly those engaged in the manufacture of men’s
wear, also were operating at fairly satisfactory levels.
Makers of china and pottery reported an increase in or
ders and demand for heavy machinery improved in some
sections. Tire production increased seasonally in Jan
uary as did steel production, but the slowing down of
the automobile industry in late January and early Feb
ruary caused a reduction in these as well as many other
industries in this District.
Coal production and retail and wholesale trade in Jan
uary were adversely affected by the unseasonably warm
weather. Dollar sales at department stores were 22 per
cent below one year ago, no allowance being made for
the decline in prices in the period.
Sales of life insurance in Ohio and Pennsylvania in
January were 6.7 per cent ahead of the same month in
1931.
FINANCIAL
With bank credit resources amplified by the Recon
struction Finance Corporation (which already has started
to make loans, thus releasing frozen credit) and rein
forced by the additional facilities provided by the GlassSteagall Bill, sentiment regarding the banking situation
in this District has improved in the past few weeks. The
number of bank suspensions in the District declined
sharply in February, there being only five in the first 27
days, compared with 18 in January.
Deposit withdrawals also have lessened and though
credit extended by member banks has not increased as
No. 3
is customary at this season of the year, the contraction,
which was unusually sharp in the closing months of 1931,
moderated somewhat in the four weeks ended February
17. The amount of reserve bank credit extended con
tinued at high levels and, though note circulation has
dropped slightly in recent weeks, it remains higher than
since 1921.
Savings deposits at selected banks receded three per
cent in January, and at the month-end were 14.7 per
cent below one year ago. The falling-off in the latest
month was partly seasonal, but larger than in other years.
Reservo Bank Credit. The total volume of this bank’s
credit outstanding on February 17 was about $6 millions
lower than on January 20, slightly less than the average con
traction in similar periods of the preceding five years. On
the latest date, however, total bills and securities, at $197
millions, compared with $90 millions one year ago and
were higher than for any similar date since 1921, when
this bank was rediscounting for other Reserve banks.
Bills discounted for member banks receded from $126
millions on January 20 to $117 millions on February 3,
but increased slightly in the two ensuing weeks to $121
millions on February 17. Compared with a year ago, this
represented an increase of approximately $100 millions.
On the latest date loans were being made to 291 mem
ber banks out of a total of 646, whereas a year ago 249
banks out of a total of 751 members were borrowing.
Loans to member banks in this District continue at rec
ord levels for this time of year.
Acceptances held by this bank declined slightly in the
four-week period, but were only a little below one year
ago on February 17. Holdings, however, were much
smaller than in preceding years, partly because of the
limited volume of acceptances created in recent months.
Government securities owned receded about $500,000,
but at $69 millions, were still about $10 millions above
one year ago.
Gold reserves were reduced about $7 millions in the
latest four weeks, contrary to the seasonal movement of
preceding years.
Circulation of this bank’s Federal reserve notes de
clined $13 millions since the first of the year, a drop of
$6 millions occurring in the four weeks ended February
17. This downward movement was in line with sea
sonal trend, but was not as pronounced as in other recent
THE MONTHLY BUSINESS REVIEW
2
years at that time. At $311 millions on tlie latest date,
circulation was $131 millions higher than a year ago.
Reflecting the slowing down in the reduction of de
posits at member banks, reserve deposits were down only
$3 millions in the four most recent weeks. In the past
year the decline has amounted to $56 millions, or 28
per cent, part of which represented the drop in deposits
at member banks, and part the closing of reserve ac
counts because of bank suspensions.
Member Bank Credit. Total credit extended by report
ing member banks in leading cities declined 0.6 per cent
in the four weeks ended February 17, the falling-off since
the first of the year being at a slightly more moderate
rate than in the closing months of 1931. Loans of these
banks receded 1.2 per cent in the four weeks, the reduc
tion in collateral loans amounting to $9 millions, being at
about the same rate evident for over a year. From the
peak in 1929, the contraction has been approximately $200
millions, or 27 per cent. “ All other” loans were reduced
$6 millions and the downward movement which has been
in progress for over two years, with only minor reversals,
was thus continued.
Investment holdings of this group of banks were slight
ly higher on the latest date than a month ago, but at $739
millions were about six per cent smaller than in February,
1931. Government securities owned amounted to $386
millions on the latest date, compared with $383 mil
lions one year ago.
The persistent decline in deposits, evident in this Dis
trict for over six months, continued in the last half of
January and the first three weeks of February. The fall
ing-off, however, was at a slower rate than in recent
months. In the four weeks ended February 17, total
deposits dropped only $17 millions, while in the three
immediately preceding four-week periods the declines in
total deposits were $64, $38, and $49 millions, respec
tively. Time deposits, at $843 millions, were down only
$1 million from a month ago, but were $153 millions, or
practically 15 per cent below a year ago.
Demand deposits declined $18 millions in the latest
four weeks to $836 millions, which was about 24 per cent
lower than last year at that time. In recent years de
posits at banks in major cities increased somewhat in
the opening weeks of the year.
The ratio of loans and discounts to total deposits at
REPORTING MEMBER BANKS
PER CENT
FOURTH
RATIO Or LOANS AND DISCOUNTS
TO TOTAL DEPOSITS
DISTRICT
________
reporting member banks, as shown on the accompanying
chart, has increased rather sharply in the past six months,
chiefly because the falling-off in deposits in the period
has been at a more rapid rate than the contraction in
total loans.
Condition figures for all member banks in the Dis
trict as of December 31, 1931, have recently become
available. A comparison of principal items with those
of a year ago shows wide variations, partly because of
the drop in the number of banks. On December 31, 1931,
there were 655 member banks in the District, whereas
one year earlier there were 757. The decline in num
ber was about 13.5 per cent, whereas the reduction in
total resources was 17.5 per cent, in total deposits 21.3
per cent and in loans and investments 16.2 per cent.
Total investments were off only 8.5 per cent, but hold
ings of Government securities of the smaller number of
banks were 9.6 per cent higher than a year ago. Loans
eligible for rediscount with the Reserve bank dropped
24 per cent to $157 millions in the year, but combined
holdings of Government securities and eligible paper
of all member banks on December 31, 1931, were only
$5 millions less than a year ago.
All Fourth District Member Banks
(Amounts in Millions of Dollars)
Dec. 31,
Dec. 31,
1931
1930
Total Resources ....................................
$3,501
$4,244
Loans and Discounts ........................
1,807
2,262
Investments— U. S. Governments
489
446
— Other Securities...........
569
711
Cash in Vault .............................. .....
54
59
Due from Banks in U. S. ..............
124
195
Demand Deposits ................................
1,107
1,375
1,334
Time Deposits ......................................
1,653
29
U. S. Deposits .................... ....... .....
29
92
Bills Discounted .............. ............ .
37
157
206
Eligible Paper ....................................
Number o f Banks ..............................
655
757
% change
from 1930
— 17.5
— 20.1
+ 9.6
— 20.0
— 8.5
— 36.4
— 19.5
— 19.3
+ 148.6
— 23.8
— 13.5
MANUFACTURING, MINING
Iron and
Steel
Iron and steel demand and production,
which continue in fair synchronization,
exhausted in the last ten days of Jan
uary the momentum remaining from the rise which fol
lowed the holiday shut-down. This upward movement
carried activity of the industry from about 20 per cent
of capacity on January 1 to 27 per cent on January 15,
reaching a peak of 28% per cent as the month closed.
Lacking expected support from the railroads and au
tomobile manufacturers, the industry barely maintained
the 28 y2 per cent rate through the first ten days of Feb
ruary, then eased off to 26 per cent by February 22.
Sentiment was somewhat weakened by the early termi
nation of a rise which in most years carried through the
first quarter, but the adjustment of the railroad wage sit
uation, the announcement by an important small-car pro
ducer that an early introduction of new models was con
templated, and the various emergency relief measures
at Washington buoyed up the hope that the upward trend
might be resumed shortly.
The decline in the steel operating rate in early Feb
ruary foreshadowed a lower total production than in Jan
uary when the daily average output was 56,203 tons.
This was an increase of 12.2 per cent over the 50,092
tons in December, or just about the usual seasonal
THE MONTHLY BUSINESS REVIEW
amount. Compared with a year ago, when output was
91,063 tons, the reduction was 38 per cent. Part of the
increase from December apparently was at the expense of
backlogs, for unfilled orders of the United States Steel
Corporation were reduced 87,203 tons in the month.
This was contrary to seasonal movements of past years
and the tenth consecutive decline. At 2,648,150 tons,
they were lower than for any time on record back to
1904. In January production was at 26.54 per cent
of capacity, compared with 23.58 in December and 42.86
per cent in January, 1931.
Though the decline in pig iron production, which has
been apparent since May, 1931, continued in January,
the reduction was just about seasonal and a net increase
of four in the number of active blast furnaces was some
what encouraging.
There were 61 out of 298 blast
furnaces in operation on January 31.
Pig iron production in January was at a daily rate of
31,336 gross tons, compared with 31,625 in December
and 55,337 tons in January, 19 31.
The mildly rising price tendency which accompanied
the expansion in early January production culminated
with a top of $30.08 on January 16, which was followed
by a moderate, but consecutive decline to $29.53 by Feb
ruary 20, as indicated by the iron and steel composite of
Steel. This easing of prices was accompanied by determined
efforts of producers to stabilize the situation.
Coal
December production of bituminous coal
in this section was the smallest on rec
ord up to that time, but January sur
passed that figure as a decline of 16.8 per cent was shown
from the preceding month. The average December-toJanuary change in the preceding eight years was an in
crease of 7.8 per cent, with only two years, 1931 and
1927, showing very moderate declines.
In the entire
country the drop from December to January was only
7.8 per cent.
Output of Fourth District mines in January was 9,168,000 tons, a falling-ofi of 39 per cent from the same
month of 1931. This compared with a 27 per cent re
duction in December and the 20 per cent decline in the
entire year 1931.
Despite the sharp curtailment in production, consu
mers’ stocks of bituminous coal increased in the fourth
quarter of 1931, an anticipated demand for coal, both for
heating and industrial uses, failed to develop. On Jan
uary 1, 1932, coal stocks were estimated to be 1,000,000
tons higher than three months earlier, but were 1,700,000 tons less than on the corresponding date of 1931,
and less than on any similar date in the past decade.
Because of the lower current rate of consumption, stocks
are larger, in terms of the number of days’ supply, than
a year ago. Stocks of coal in retail dealers' yards, though
actually slightly smaller than a year ago, also were larger
in terms of the number of days’ supply.
Reports for the first two weeks in February indicated
a slight improvement in production, partly a result of
colder weather.
Coal companies are attempting to work out some plan
which would stabilize the industry, both as regards prices
3
and production, but nothing definite has developed as
yet.
Automobiles
The upturn in automobile production
terminated about the middle of Jan
uary when retail demand failed to de
velop to the extent anticipated earlier in the season. Ac
tual production has not declined very sharply, but in
past years a sizeable expansion has occurred in the lat
ter part of January and February.
The falling-off in late January was enough to reduce
the seasonally adjusted index of the Federal Reserve
Board from 66 per cent of the 1923-25 average in De
cember to 45 for the entire month of January.
This
compared with 63 in January, 1931. According to Cram's
reports, a slight increased occurred in the first two weeks
of February, but this was not up to seasonal propor
tions and the weekly adjusted index dropped below 40
per cent.
Actual output in January, according to the Department
of Commerce, was 119,344 cars and trucks, a drop of 1.8
per cent from December, and which compared with 171,848 in the corresponding month of 1931. Passenger car
production was 98,803 units against 138,317 cars a year
ago and truck output was 20,541 compared with 33,531
in January, 1931.
The very unfavorable comparison with last year was
partly due to the fact that one principal small-car pro
ducer was practically out of production during the first
two months of the year.
The reduction in January also
was a reflection of the very cautious attitude maintained
by most car manufacturers.
Vigorous attempts have been made to keep output in
line with actual demand and orders for materials and
parts have been placed only in small quantities. Be
cause of this irregularity, operations of many parts and
accessory companies have shown rather wide fluctuations
recently, though generally they are much below other
years at this season.
Tires,
lUibber
The tire industry appears to have stabilized its operations recently, for only
minor changes in employment have been
apparent in the past few months at factories in this Dis
trict, though the index of the Ohio State Bureau of Busi
ness Research in January was only 65 per cent of the
1926 average. This is eight points lower than a year
ago.
Reports from manufacturers indicate that operations
in January and early February were higher than in De
cember, but this was entirely seasonal, and sales of re
newal tires w~ere reported about 15 per cent below one
year ago. Consumption of crude rubber in January
amounted to 27,962 long tons, compared with 21,409 tons
in December, an increase of 30.6 per cent, which was
about seasonal. Consumption in January, 1931, was 28,557 tons.
As the spring selling season approaches, the outlook
for tire makers is better than for some time. Prices are
very low and with many cars remaining in service that in
more normal times would be scrapped, a greater demand
THE MONTHLY BUSINESS R EVIEW
4
for replacement tires is anticipated, sales of which gen
erally are more profitable to manufacturers than original
equipment sales.
Production of tires in December, the latest period for
which figures are available, was slightly higher than in
November, but shipments exceeded output by 5.2 per
cent. Tire production in 1931 was only 4.5 per cent be
low 1930, but shipments of tires exceeded produc
tion by a good margin, for inventories on December 31
were about 1,000,000 tires less than at the end of 1930,
and were smaller than since 1925. Manufacturers re
port stocks about in line, in view of reduced demand and
the longer life of the average tire.
The crude rubber situation, both in this country and the
world, shows little evidence of improvement. Imports
to the United States in January were 31,298 long tons,
a drop of 40 per cent from the high level of December
and 15.6 per cent from a year ago, but they exceeded do
mestic consumption, and crude rubber afloat for United
States ports, which amounted to 77,244 long tons on Jan
uary 31, compared with 53,940 tons a month ago and 56,188 tons at the end of January, 1931.
Total domestic stocks of crude rubber on hand Jan
uary 31 were estimated at 322,860 tons, an increase of
54.1 per cent from one year ago. The accompanying
chart shows monthly stocks in the United States and the
world for the past six years, together with the monthly
average price of crude rubber at New York. With the
exception of a few months in 1928, when the Stevenson
Restriction Act was in force, and a period of 1929, world
crude rubber stocks have increased steadily from about
150,000 tons in January, 1926, to 575,000 tons at the end
of 1931, or about 280 per cent. In the same period do
mestic stocks advanced from 51,000 tons to about 325,000 tons, over 500 per cent.
Domestic stocks have increased much more sharply in
recent years than world stocks and at present represent
over 50 per cent of the total supply, while in 192 6 they
amounted to only about one-third of the total crude rub
ber on hand. Even in 1926-1929 when consumption of
crude rubber was increasing sharply, stocks advanced
nearly twice as fast as consumption, and when takings
of crude rubber declined in 1930 and 1931, production
was only slightly reduced. According to a recent esti
mate, output continues from 400 to 500 tons a day above
world requirements. Exports from Eastern producing
STOCKS RUBBER STOCKS AND PRICES
PRICE
THOUSANDS OF TONS________________ END OF MONTH____________________ CENTS PER LB.
r............
i------------ --WORLD TOTAL STOC!KS
—
UNITED STATES STO CKS
---------- WHOLESALE PRICE
t
1
I
1
V
■\
A
"N
1926
1927
1928
1929
1930
" S .
1931
1932
countries reflected increases in production in the closing
months of 1931 from a year earlier.
Rubber consumption in the United States in 1931 was
7.6 per cent below 1930, while in foreign countries the
falling-off was about five per cent.
The relatively larger
drop in domestic takings reflected in part the sharp de
cline in the automobile industry and the longer life of
tires now being made.
The trend of rubber prices in recent years has been
just the inverse of stocks. Prices have been subject to
wide fluctuations, but they never before reached such low
levels. In February crude rubber was selling in New
York at less than four cents a pound.
The drop in the
past twelve months was over 50 per cent and as recently
as 1927 rubber brought 40 cents a pound. In 1925, under
the Stevenson Restriction scheme, it was selling at a dol
lar a pound. The recent low level is almost unbeliev
able in view of the fact that cost of production averages
about 16 cents a pound. Because of the low prices, some
of the smaller producers have stopped tapping their trees,
but others, and among them some of the larger estates,
evidently feel they will lose less in the end by produc
ing a maximum crop irregardless of prices, rather than
let their plantations deteriorate. Plans for curtailing
production have been proposed, but because of varied na
tionalities, difficulty regarding individual cooperation,
etc., nothing definite has resulted.
The sharp decline in prices in the past few years has
resulted in drastic inventory losses to rubber manufac
turers, who, because of the great distance from the source
of supply, are forced to carry large stocks of raw ma
terials. Though declines similar in extent to those oc
curring in 1929, 1930 and 1931, can hardly take place
from present prices, a stabilization at reasonable levels
is much to be desired.
Clothing
Activity at many clothing and textile
plants in the District improved in Jan
uary and continued at the higher rate
in early February. Employment figures have not changed
materially, but the number of hours worked has in
creased. This normally is one of the busiest seasons of
the year for clothing factories, as preparation is made
for the spring selling season. With Easter occurring
much earlier than for some time, demand for spring ap
parel is expected to increase.
On a unit basis, operations and sales compare rather
favorably with a year ago, considering general condi
tions, but dollar volume is much reduced. Wearing ap
parel prices have dropped sharply in the past two years
as raw material, wages and other costs have receded.
Operations at factories making men’s clothing continue
at a considerably higher level than at those engaged en
tirely in producing women’s apparel. Employment at the
former in January was about 97 per cent of the 1926
average and one per cent above last year, while the in
dex for the entire clothing group was only 84 per cent of
the 1926 average and three per cent below one year ago.
Continued warm weather seriously hampered the dis
posal of surplus stocks, particularly overcoats, both at
wholesale and retail. Sales of women's clothing in Jan
uary at reporting department stores were about 39 per
5
THE MONTHLY BUSINESS R EVIEW
cent below the same month of last year and men’s cloth
ing sales were off about 31 per cent in the same period.
Prices of clothing have dropped about 16 per cent in the
year, according to reports.
Considerable difficulty regarding collections and ar
ranging credit is reported, particularly in those sections
where there have been numerous bank suspensions.
Shoes
The footwear industry is one of the
few which appears to have reached bot
tom and to have been able to exhibit
an upturn. During 1931, with the exception of a slight
fall slump, demand for shoes tended upward and opera
tions increased to a corresponding degree. Production
at factories in this section, most of which are in the
southwestern part of the District, advanced more than
seasonally in December and the upturn continued in Jan
uary. Output in the latest month was 20 per cent ahead
of December and 6.4 per cent above January, 1931.
Manufacturers usually are operating at or near peak
levels at this season of the year, but the recent greaterthan-seasonal increase is partly attributable to the early
date of Easter. Makers of women’s shoes, particularly
in the lower-priced fields are operating at higher levels
than producers of higher-priced or men’s footwear. In
ventories, both retail and wholesale, are reported below
normal.
The dollar value of women’s shoe sales at reporting
department stores in this District in January was 21 per
cent below the corresponding month of 1931 and men’s
shoe sales were down 24 per cent in the same period.
Price reductions distort the figures, however, for prices
of women’s shoes were reported to be 15 per cent below
one year ago, while men’s shoes were down only nine
per cent in the same time.
Other
Manufacturing
The upturn in operations in early
January in this section proved to be
only temporary in many cases, and ac
tivity in latter half of the month and the first part of
February was again at a lower level. Failure of the au
tomobile industry to maintain its increase worked a par
ticular hardship on many companies in this section,
though definite announcement from one of the principal
small-car producers that work on two new models had
started clarified the situation measurably. Sentiment ap
pears to have improved further because of this and the
enactment of recent legislation working toward a cessation
of the drastic deflation which has continued for so many
months.
Auto Parts and Accessory. Automobile sales so far
have been disappointing, and assemblying schedules were
reduced in many plants. Operations at parts and ac
cessory plants in mid-February were reported little changed
from January, which was about on a par with December.
Employment at 40 concerns, however, was 22 per cent
below one year ago, which in turn was 16 per cent below
January, 1930. This is usually the busiest season of the
year for parts companies, but present operations are only
a fraction of what they were in other years. Price trends,
with respect to both materials and labor, are still down
ward and inventories are very small.
Ceramics. Reports from southeastern part of the Dis
trict showed an improvement in February, with some
plants operating at capacity levels. Employment at 68
stone, clay and glass factories increased two per cent in
January, in contrast to a seasonal decline of eight per cent
in recent years. Compared with a year ago, the group
showed a falling-off of 11 per cent. Makers of dinnerware state that orders were received in good volume in
early February at prices unchanged from a month ago.
Brick and tile plants are practically shut down.
Glass. Glass production continues irregular.
Plate
glass.
Container and household glass manufacturers
proportions, in January, which was maintained in early
February. Orders were chiefly from the automobile in
dustry, there being practically no demand for building
glass. Container and household glass manufacturers
were operating irregularly, some being engaged at much
higher rates than others.
Electrical Equipment. Little change was apparent in op
erations at plants making electrical appliances, apparatus,
etc.; orders in early February were less numerous than
in the preceding month and very much below a year ago.
Employment at 29 concerns was two per cent below Jan
uary, 1931, but many plants were operating on reduced
schedules.
Hardware, Machinery. Rather sizeable orders were re
ceived recently for heavy machinery by some Cincinnati
concerns, but the industry as a whole showed little change
in early February from the low level of January. Em
ployment in the latter month at 116 plants was 16 per
cent below one year ago and was off two per cent from
December. Hardware demand was limited, though slight
ly better than one year previous.
Paint. Sales of paint in January were considerably be
low one year ago. Increased demand from the automobile
industry afforded a slight spurt, but this has since fallen
off. Inventories have increased slightly in anticipation
of spring business. Salesmen report a better sentiment
prevailing, but buying is very limited.
Prices remain
unchanged from last month.
Paper. Developments in the past month have not been
favorable. Employment in January was three per cent
smaller than in December and eight per cent below one
year ago. Prices on some grades have dropped, and com
petition, particularly foreign, is keen.
Sheet Metal, Etc. A greater-than-seasonal decline in
employment at sheet metal works was reported in Jan
uary, which was 25 per cent below one year ago. Makers
of metal containers reported general orders better, but
food containers are in very reduced demand, partly be
cause of the large carryover of canned goods.
TRADE
Retail trade, as reflected by total sales at leading de
partment stores in this District, was quite depressed in
January, total sales, on a daily average basis, being 22
per cent below the same month of 1931.
The decline
from December was considerably more than seasonal and
the adjusted index, at 69.5 per cent of the 1923-1925
monthly average, was below 70 per cent for the first time
THE MONTHLY BUSINESS REVIEW
6
since 1919. In December the adjusted index was 73.0
per cent.
Part of the decline in dollar sales was due to price re
ductions, for January pre-inventory sales in many cases
were at very much lower prices than prevailed in Decem
ber or a year ago. According to Fairchild's retail in
dex, prices in January recorded the largest monthly de
crease in the present deflation. The drop in the month
was 2.5 per cent and prices have receded 19 per cent
from January, 1931.
Moderate weather in this section was an added handi
cap and sales of seasonable goods were very slow in Jan
uary or were made at a sizeable price reduction.
The dollar value of stocks dropped 5.4 per cent in
January, slightly less than the seasonal change at this
period of the past years and the adjusted index rose from
70.5 per cent of the 1923-25 monthly average in De
cember to 71.4 per cent at the end of January. Com
pared with a year ago, retail value of inventories is down
13.5 per cent.
The decline in accounts receivable in January from a
year ago was 18.5 per cent, somewhat less than the fall
ing-off in sales, and the percentage of accounts receiv
able at the end of December collected in January was
33.7 per cent compared with 36.8 one year ago, a drop of
about eight per cent.
Sales at reporting wearing apparel stores were 35 per
cent smaller in January than last year and stocks were
down 22 per cent in value.
Sales of furniture stores were about 35 per cent smaller
in January than a year ago, while the decline in sales in
the furniture departments of department stores was only
27 per cent.
Wholesale trade in past years has declined about 10
per cent from December to January, but the falling-off in
the four reporting lines this year was 16 per cent. Whole
sale drug sales increased 1.4 per cent in January, con
trary to seasonal, but were still 17 per cent below Jan
uary, 1931.
AGRICULTURE
The annual January 1 livestock survey of the Depart
ment of Agriculture revealed that the number of four
principal types of farm animals in states comprising this
District was about four per cent larger than on the same
date last year. In the entire country the increase was about
two per cent.
Total farm value of livestock, however, dropped nearly
20 per cent in this section in the same period, while the
falling-off in the entire country was 28 per cent. Thus
the decline in livestock values in the Fourth District, as
well as crop values, was somewhat less than in the entire
country, and the reduction was chiefly due to price de
clines. In the United States all livestock was valued at
$3,196,000,000 on January 1, 1932, compared with $4,450,000,000 one year earlier. In the past two years live
stock values have fallen $2,800,000,000.
Livestock on Fourth District and
(000 omitted)
Number
January 1,
1932
% change
from
1931
U.
S.
Farms
Total V alue
January 1,
% decline
from
1932
1931
3.1
3.9
3.9
5.4
3.7
$40,730
30,797
10,434
7,467
676,698
— 9.3
— 7.5
All Cattle
Ohio ....................... 1,610
Pennsylvania ........ 1,398
Kentucky .................
978
West Virginia ......
525
United States ...... 62,407
+ 3.1
-f- 3.0
+ 4.0
-j- 5.0
-{- 2.4
55,670
66,016
23,167
15,028
1,662,222
— 23.8
— 28.3
— 22.4
— 16.5
— 30.6
Sheep and Lambs
Ohio ......................... 2,164
Pennsylvania ..........
491
Kentucky .................
875
West Virginia ......
657
United States .......... 53,912
-f 8.2
+ 2.1
*
4* 5.1
+ 2.2
7,550
2,169
4,130
2,894
183,255
— 17.6
— 23.1
— 26.8
Swine
Ohio ......................... 2,072
655
Pennsylvania ........
Kentucky .................
899
West Virginia ......
176
United States ...... 59,511
*No change.
-f 5.0
i 2.0
4*15.0
+ 4.8
4- 9.4
13,650
5,586
5,212
1,315
365,133
— 30.9
— 30.1
— 12.3
Horses and Colts
Ohio .......................
469
Pennsylvania ..........
297
222
Kentucky ....... ........
West Virginia ........
106
United States .......... 12,679
—
—
—
—
—
—
11.2
— 15.8
— 14.9
—
21.0
— 35.1
—
8.1
— 40.9
Tobacco
The tobacco selling season is rapidly
approaching its end, several of the
m arkets in the outlying sections hav
ing closed in early February, but as usual, Lexington
m arkets remained open longer than others. Though con
siderable tobacco is still being sold, it is chiefly of inferior
quality, generally the case at this tim e of year.
Prices
consequently declined as the lower grades appeared.
The average price paid for the 1931-32 burley tobacco
crop is the lowest since 1915. W ith the crop the largest
on record, 465,000,000 pounds, a large carryover from
last year, and a decline in cigarette consumption for the
first time in several years, prices were substantially re
duced. The average price paid for burley tobacco this past
season was about nine cents a pound. Sales in January, ac
cording
to the K entucky
amounted to
a pound.
Com m issioner
of Agriculture,
170,701,400 pounds at an average of 8.56 cents
In the same month last year the price averaged
15.01 cents a pound. A ll burley sales in K entucky up to
February 1 amounted to 272,047,004 pounds, averaging
nine cents, compared with 233,147,924 pounds, averag
ing 15.8 cents for the same period of 1931. Thus an in
crease of about 17 per cent in volum e of sales was ac
companied by a shrinkage of about 34 per cent in gross
revenue.
The accom panying chart shows the average price paid
7
THE MONTHLY BUSINESS REVIEW
for burley tobacco in the past 17 years, together with
the total crop raised in these periods. Since 1928 the
price has been reduced by two-thirds. At the same time
production has increased sharply, advancing from less
than 200,000,000 pounds in 1927, to the present level,
or more than 130 per cent. This increase in burley to
bacco has been offset in part by declines in flue-cured
types raised in Virginia and the Carolinas, though total to
bacco production increased 33 per cent in the same period.
BUILDING
The first two months of the year usually are the low
est in contract volume, and based on available figures,
and in view of the very unfavorable conditions prevail
ing, little change is yet apparent in the building indus
try, though certain favorable developments in the gen
eral situation appear to have improved sentiment among
building supply dealers and contractors.
According to the special survey of the F. W. Dodge
Corporation, “ prospects for residential building are mod
erately good,” particularly in regard to small houses, in
principal cities of this territory. Reductions in public
appropriations and earnings of commercial concerns con
tinue to affect non-residential building very materially.
Contracts awards in the Fourth District in January
were less than half as large as in December and were
over 60 per cent below January, 1931. They amounted
to only $6,924,000. There usually is a falling-off from
December, but, based on figures available, it never was
as large as this year. The decline from a year ago in
residential building and other types was about equal, on
a percentage basis. Public works and utility awards
amounted to only $2,578,000 in January, compared with
$7,517,000 in the corresponding month of last year, when
a power plant contract amounting to about $5,000,000
was awarded.
Utility awards in January, 1931, were
smaller than in any month of the preceding three years.
Fourth District Business Conditions
(000 o m itte d )
F ou rth D istrict Unless O therw ise Specified
B ank D ebits— 24 c itie s ..................... ...................3
Savings D eposits— end o f m on th :
27 selected banks, O., W . P a . , . ................... 3
P ostal R eceip ts— 9 c itie s .................. ...................3
Life Insurance Sales:
O hio and P e n n a ............................... ...................3
R etail Sales:
D epartm en t Stores— 55 firm s. . . ...................3
W earing A p parel— 13 firm s.......... ................. 3
Fu rn iture— 47 firm s....................... ...................3
W holesale Sales:
D rugs— 13 firm s.............................. ....................3
D ry G ood s— 11 firm s.................... ............3
G roceries— 37 firm s........................ ............3
H ardw are— 15 firm s....................... ............3
B u ilding C on tracts— R esidential, , ................... 3
— T o t a l .............. ............3
C om m ercia l Failures— L ia b ilitie s ., ................... 3
*
«
— N u m ber. . .
P ro d u ctio n :
P ig Iron, U. S..................................
Steel Ingots, U. S.........................
A u to-P a ss. C ar3.............................. ..........U. S.
“ T r u c k s .......................................... , . , .U . S.
B itum inous C o a l..............................
C em ent— O., W . Pa., W . Va.
, , Bbls.
E lec. P ow er— O., Pa., K y ............ . . . . k.w.h.
Bbls.
P etroleu m — O., Pa., K y ..............
S h oes......................................................
T ire*, U. S.......................................
A ctu a l N um ber.
D ecem b er
C on fidential
Jan.,
1932
2,090,000
% chang<
Jan.,
from
1931
1931
3,301,000 — 3 6 .7
665,738
2,510
763,825
2,987
96,984
90,869
+
12,588
733
412
17,150
1,129
640
— 2 6 .6
— 3 5 .1
— 3 5 .7
1,314
725
3,442
737
1,916
6,924
9,628
3221
1,584
1,228
4,577
1,001
4,936
17,971
11,952
2541
— 1 7 .0
— 4 1 .0
— 2 4 .8
— 2 6 .4
— 6 1 .2
— 6 1 .5
— 1 9 .4
+ 2 6 .8
973
1,461
98,8031
20,5411
9,167
246
1,1802
2,0763
1,715
2,459
138,3171
33,5311
14,936
505
1,2802
1,9672
s
2,2642
8
2,125*
— 1 2 .8
— 1 6 .0
—
—
—
—
—
—
—
+
+
—
6 .7
4 3 .3
4 0 .6
2 8 .6
3 8 .7
3 8 .6
5 1 .3
7 .8
5 .5
6 .4
6 .1
Fourth District Business Indexes
(1923-1925 = 100)
[an.,
1932
77
Bank D ebits (24 c it ie s )..........................
221
C om m ercial Failures (N u m b e r )..........
218
( L i a b i li t ie s ) ....
97
P ostal R eceipts (9 c it ie s ) ........................
116
Sales— Life Insurance (O h io & P a .) . .
55
“ — D epartm en t Stores (55 fir m s ).
84
* — W holesale D rugs (13 fir m s ).
28
D ry G ood s (10 fir m s )..........
57
“ —
*
G roceries (37 fir m s )..............
36
“ —
“
H ardw are (14 fir m s )............
52
* —
All ( 7 4 ) ......................................
77
* —
“
Chain D rugs (3 fir m s )* * ...
15
B u ilding C on tracts ( T o t a l ) .....................................
11
u
u
(R e s id e n tia l).........................
51
P ro d u ctio n — Coal (O ., W . Pa., E. K y .) ............
20
— Cem ent (O ., W . Pa., W . V a . ) . . .
141
“
— Elec. P ow er (O ., Pa., K y . ) * . . . .
112
*
— Petroleum (O ., Pa., K y .) * ..........
70
“
— S h oes.....................................................
♦D ecem ber.
* *P er individual unit op erated.
Jan.,
1931
122
174
271
115
109
70
101
48
76
49
70
86
38
29
83
42
152
106
66
Jan.,
1930
127
121
138
126
137
77
106
62
91
64
83
82
73
46
101
60
161
128
89
Jan.,
1929
136
134
105
122
130
84
130
70
92
74
90
81
115
66
103
68
149
107
104
Jan .,
1928
127
184
136
116
103
85
104
73
82
73
81
82
55
74
86
63
145
102
105
Debits to Individual Accounts
G reen sb u rg .......... .
H o m e s te a d ...........
M id d le to w n .........
S teu b en v ille.........
Y o u n g s to w n . . . .
(T h ou sa n d s o f D ollars)
Y ea r-to-d a te Y ea r-to-d a te
4 weeks
%
Jan. 1 to
ending
change
D ec. 31 to
Feb. 17,
Feb. 18,
Feb. 17,
from
1932
1931
1932
1931
45,693
133,117
— 3 4 .9
95,383
5,635
10,953
15,549
— 2 7 .3
17,909
— 4 6 .1
64,319
33,238
251,259
622,338
— 2 1 .5
474,151
398,783
867,923
1,224,800
— 3 2 .0
92,615
295,656
— 3 4 .5
185,344
41,255
— 3 7 .7
80,376
146,603
22,204
— 1 9 .8
41,391
49,504
3,025
— 8 .7
6,217
7,036
5,231
— 2 7 .1
11,678
19,931
7,679
— 2 6 .7
18,471
14,045
2,607
— 2 7 .2
4,500
6,209
22,684
43,934
53,220
— 1 6 .6
7,019
— 2 8 .6
12,438
20,691
3,533
— 2 0 .4
8,499
6,278
5,532
— 4 1 .1
9,941
18,050
8,210
— 1 9.3
20,443
15,774
513,058
— 3 6.1
1,000,225
1,408,656
11,225
33,264
— 3 1 .7
22,880
5,775
— 2 2 .7
10,403
13,517
74,736
— 4 1 .0
135,948
270,362
4,143
— 5 1 .6
7,624
17,271
24,738
— 2 2 .9
49,364
65,627
26,095
— 4 4 .9
57,516
94,573
5,752
— 3 0 .3
11,332
16,561
%
change
from
1931
— 2 8 .3
— 2 9 .6
— 4 8 .3
— 2 3 .8
— 2 9 .1
— 3 7 .3
— 4 5 .2
— 1 6 .4
— 1 1 .6
— 4 1 .4
— 2 4 .0
— 2 7 .5
— 1 7 .4
— 3 9 .9
— 2 6 .1
— 4 4 .9
— 2 2 .8
— 2 9 .0
— 3 1 .2
— 2 3 .0
— 4 9 .7
— 5 5 .9
— 2 4 .8
— 3 9 .2
— 3 1 .6
1,606,395
— 3 0 .9
— 3 2 .8
3,208,856
4,644,267
Wholesale and Retail Trade
(1932 com p ared w ith 1931)
P ercentage
Increase or D ecrease
COLLEC
SALES
STOCKS
T IO N S
D E P A R T M E N T S T O R E S (55)
A k r o n . ................................................................
C in cin n a ti...........................................................
C le v e la n d ............................................................
C o lu m b u s ..........................................................
P itts b u rg h ..........................................................
T o l e d o ............................................... . ................
W h e e lin g ...........................................................
Y o u n g s to w n .......................................................
O ther C itie s....................................................
D is tr ic t..............................................................
W E A R I N G A P P A R E L ( 13)
C in cin n a ti.........................................................
O ther C ities....................................................
D is tr ic t..............................................................
F U R N I T U R E ( 51)
C in cin n a ti.........................................................
C le v e la n d ..........................................................
C o lu m b u s..........................................................
D a y t o n ...............................................................
T o le d o ................................................................
O ther C ities....................................................
D is tr ic t..............................................................
C H A IN S T O R E S *
D rugs— D istrict (4 ) .....................................
G roceries— D istrict ( 6 ) ..............................
W H O L E S A L E G R O C E R I E S ( 37)
A k r o n .................................................................
C le v e la n d ..........................................................
E r ie ......................................................................
P ittsb u rg h ........................................ ................
T o l e d o ................................................................
O ther C itie s ....................................................
D is t r ic t ..............................................................
W H O L E S A L E D R Y G O O D S ( 11) . . .
W H O L E S A L E D R U G S ( 13) ...............
W H O L E S A L E H A R D W A R E ( 15) . . .
*Sales per individ ual unit op erated.
Jan.
Jan.
Jan.
— 3 0 .3
— 2 5 .1
— 2 2 .0
— 2 5 .6
— 2 8 .5
— 2 8 .7
— 32 .1
— 3 2 .0
— 2 7 .1
— 2 6 .6
—
—
—
—
—
—
—
—
—
—
1 2 .0
2 1 .4
2 .7
1 4 .7
1 2 .2
2 0 .8
1 2 .2
2 5 .8
2 2 .6
1 3 .5
— 2 3 .8
— 1 3 .9
— 1 8.3
— 19.1
— 2 5 .2
— 2 9 .0
— 2 8 .8
— 3 3 .6
— 2 5 .4
— 2 3 .1
— 3 2 .1
— 3 6 .7
— 3 5 .1
— 1 3 .7
— 2 6 .7
— 2 2 .7
— 1 6.3
— 2 5 .2
— 2 2 .8
—
—
—
—
—
—
—
4 0 .9
3 6 .8
4 1 .0
3 6 .1
1 1.3
3 5 .0
3 5 .7
—
—
—
—
—
—
—
3 1 .7
2 4 .4
4 2 .6
2 4 .9
3 1 .6
2 6 .2
2 8 .3
—
—
—
—
2 4 .9
3 3 .2
2 2 .9
3 1 .2
-1 0 .4
-
11.1
-2 8 .8
-2 3 .5
-
21.0
-2 1 .4
-
21.2
- 2 7 .2
-2 4 .8
-4 0 .9
- 1 7 .1
-2 6 .4
-1 6 .8
- 3 0 .3
— 9.fi
I
THE MONTHLY BUSINESS R EVIEW
Summary of National Business Conditions
By the Federal Reserve Board
In January production of manufactures increased by about the usual
seasonal amount, while output of minerals and value of building contracts
awarded continued to decline.
Wholesale prices declined further during January and early February,
but more recently prices of certain leading commodities showed an advance.
Production and Employment
Index number o f industrial production, adjusted
for seasonal variation (1923-1925 average =
100.)
Latest figure, January, 70.
Indexes based on three-month m oving averages
of the F. W . Dodge Data for 37 Eastern States,
adjusted for seasonal variation, (1923-1925 aver
age = 100.)
Latest figure, January, total, 33,
residential, 20.
PERCENT
PPRCfw?
Volume of industrial production, which includes both manufactures
and minerals, increased from December to January by an amount some
what smaller than is usual at this time of year, and the Board’s seasonally
adjusted index declined from 71 per cent of the 1923-1925 average to 70
per cent. In the steel industry there was a seasonal increase in activity
during January, followed by a slight decline during the first three weeks of
February. Production of automobiles, which usually increases considerably
at this season showed little change in January, following an increase in
December. Activity at textile mills increased by more than the usual sea
sonal amount and at shoe factories there was a seasonal increase in pro
duction. Output of coal and petroleum was substantially reduced.
Volume of factory employment declined by more than the usual sea
sonal amount between the middle of December and the middle of January.
Number employed at foundries, car-building shops, clothing factories, and
establishments producing building materials declined substantially, while
employment in the tobacco industry decreased less than is usual at this
season, and employment in the woolen goods industry increased, contrary
to seasonal tendency. Total value of building contracts awarded in 37
eastern states, as reported by the P. W. Dodge Corporation, declined sharply
in January, and for the three-month period ending in that month was about
one-half of the amount awarded in the corresponding period a year ago.
Approximately one-fourth of the decrease was in residential building, and
three-fourths in other types of construction.
Distribution
Total freight carloadings decreased in January, contrary to seasonal
tendency, reflecting chiefly smaller shipments of merchandise, miscellaneous
freight, and coal. Department store sales declined by about the usual sea
sonal amount.
Wholesale Prices
The general level of wholesale commodity prices, as measured by the
index of the Bureau of Labor Statistics, declined two per cent further from
December to January, although prices of some important commodities, such
as wheat, showed little change and the price of cotton advanced. During
early February prices of certain leading commodities, including grains and
cotton, declined, but later in the month there was some advance in the
prices of these commodities.
Indexes of daily average value of sales with and
without seasonal adjustm ent, (1923-1925 aver
age = 10*0.) Latest figure, adjusted, 80, unad
justed, 65.
Monthly averages of weekly figures for reporting
member banks in leading cities. Latest figures
are averages o f first three weeks o f February.
Bank Credit
Volume of Reserve bank credit outstanding declined in January and
the first half of February. This decrease reflected a return flow of currency
from circulation, which has been smaller than usual this year, together with
a continued reduction in member bank reserve balances, offset in part by a
demand for reserve bank credit, caused by an outward movement of gold
amounting to $100,000,000 since the turn of the year. A decline in money
in circulation after the first few days in February reflected some return
of hoarded currency, accompanying a decrease in bank failures.
At member banks in leading cities volume of credit continued to de
cline during January and the first half of February. Between January 13
and February 17, total loans and investments decreased by $550,000,000
representing declines in loans on securities, in “ other” loans and in in
vestments. Deposits of these banks also declined substantially during this
period.
Money rates in the open market showed little change. On February
26 the discount rate of the Federal Reserve Bank of New York was reduced
from 3 % to 3 per cent, and buying rates on bankers’ acceptances of short
maturities were reduced from 2 % to 2 % per cent.
@FedFRASER