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The Monthly
BUSINESS REVIEW
Cbiteriig business andindustrial conditions m the Ixm&i JtderedRuerw lX strict
FEDERAL RESERVE BANK of CLEVELAND
D.C.Wills, diairman of ihe Board
(COMPILED APRIL 20, 1922)
VOL. 4
CLEVELAND, OHIO, MAY 1, 1922
USINESS is still moving in the right direc
tion despite recent developments of an un
favorable nature. Spring naturally brings a
brighter outlook. Seasonal activity is helping. In
addition to this, people believe business is growing
better, and though the coal strike and other disor
ders throughout the country have slowed up some
of our basic industries, they have not permitted this
to dim their long-range vision. This confidence is
another vital cornerstone in the foundation of busi
ness prosperity.
The coal strike, unprecedented in its magnitude
as well as potentially disastrous to business, be
came effective throughout the country when more
than a half million miners ceased work on the last
day of March, (iovernment reports show that
nearly two-thirds of the bituminous tonnage of the
country has been closed by the strike. Whether
this great walk-out will seriously retard or actually
arrest the apparent movement toward business re
covery is still problematical. It is estimated by
government statisticians that, at the prevailing rate
of consumption, consumers’ stocks of soft coal on
hand should last approximately two months. If the
strike should be prolonged beyond that period, the
nation would inevitably experience a fuel famine.
For this district, perhaps the most reliable indicia
of business prosperity are the monthly tonnage fig
ures for pig iron and steel ingot production. The
output of both pig iron and steel ingots was sub
stantially greater in March than in February, the in
crease being due mainly to the heavy orders of
certain railroads for new cars and other equipment.
It is estimated that the railroads alone take, in
normal times, almost one-fourth of the total steel
tonnage. Several steel companies in this District
have recently received large orders from the rail
roads. The United States Steel Corporation’s March
statement of unfilled orders shows the largest
monthly increase recorded since April, 1920.
Late reports from the Pittsburgh and Youngs
town districts indicate that iron and steel plants
are even now beginning to feel the effects of an
actual or anticipated fuel shortage. A number of
B
No. S
blast furnaces have been banked and some mills
are curtailing or suspending operations in the in
terest of fuel conservation. Owing to stocks of
coal 011 hand, however, the industry is still able to
operate at about 75 per cent of capacity.
According to reliable trade sources, practically all
of the large manufacturers of passenger cars and
trucks turned out more vehicles during March than
in any other month since August, 1920. Passenger
car and truck output for the first quarter of this
year far exceeded that for the corresponding period
of 1921. One large producer of motor trucks in this
District reported that March orders were consider
ably larger than in any month since May, 1920,
and that deliveries exceeded those recorded for any
month since September, 1920. It is confidently pre
dicted that automobile and auto parts manufac
turers will have a much larger volume of business
this year than they had in 1921.
As would naturally be expected, the rubber tire
industry is sharing with the automotive industry
the increasing prosperity of the latter. Tire fac
tories in Akron, Ohio, are reported to be operating
at about 85 per cent of capacity. A recent advance
in the price of crude rubber on the New York mar
ket is attributed, in part, to increased buying on
the part of tire manufacturers.
While an increase in building operations in
spring is, of course, a seasonal phenomenon, there
is no doubt but that the country is now experi
encing a real boom in this field. 'The valuation of
building contracts awarded during March in the
northeastern states increased 65 per cent over the
Februnry figure. The valuation of building permits
issued by the principal cities in the Fourth Fed
eral Reserve District during March was nearly
double that reported for February, and about onefourth more than the valuation of such permits
issued in March, 1921.
That the payrolls of some business establish
ments in this District are growing is indicated by
an expansion in the note circulation of the Federal
Reserve Bank of Cleveland. Debits to individual
accounts, as reported by clearing house banks, also
ON PAGE 12 APPEARS A STORY OF THE FISCAL AGENCY DEPARTMENT OF OUR BANK*
THE M O N T H L Y B U S I N E S S
2
show that the volume of business transactions is
increasing at a moderate rate.
The liabilities of commercial and manufacturing
firms failing in this District were somewhat less in
March than in February, continuing the downward
trend observable since January. The liabilities of
such firms for the first quarter of this year are
much greater in amount than they were for the
corresponding quarter of 1921. An analysis of the
bankrupt firm shows that the failures predominated
in the wholesale and retail trade group embracing
wearing apparel, dry goods, boots and shoes, and
similar lines.
A monthly survey of industrial employment
made by the United States Employment Service
shows that during March payrolls increased in all
industries except food, textiles, and leather, and
their products. Such 'basic industries as iron, steel,
and other metal products, vehicles, railroad repair
shops, paper, printing, and stone, clay and glass
products, made substantial gains during March.
Public employment offices located in the largest
cities of Ohio reported a large increase in the num
ber of persons actually placed during March, as
compared with February.
There is a marked improvement in the condition
of the agricultural industry, according to the direc
REVIEW
tor of the War Finance Corporation. Bank de
posits have increased in many agricultural com
munities and the country banks are generally in a
stronger position than they have been for a long
time. Up to March 31, the War Finance Corpora
tion had approved over three hundred million dol
lars in loans for agricultural purposes. Late official
estimates indicate that the prospective yield o f
winter wheat will be about two million bushels
less than the average annual yield for the past
ten years. Cheering news for the farmer is the
general downward trend in the prices of farm im
plements, tractors, and other agricultural supplies
reported by the United States Department of
Agriculture.
While the business outlook is growing better
almost daily, we must remember that it must nec
essarily proceed at a slow pace. We can again
begin to look forward with confidence to a com
plete restoration of normal industrial activity; but
we must not permit ourselves to relax the atten
tion to the task in hand. If we can continue to
improve gradually, we will find the foundation o f
recovery so substantial that we will be better pre
pared to enjoy that longer and continued indus
trial activity which we hope to be not so very far
ahead.
Loans to City Banks Increase Slightly; Little Change in Demand
From Country Banks; Acceptance Market Dull
There has been no change of outstanding im
portance in the banking situation since last month.
Loans and rediscount demands on us by our mem
ber banks, however, and particularly those in the
cities, have been on the increase, indicating to some
extent the improvement of business in general.
From March 20 to April 1 the loans to country
banks increased approximately $1,000,000, but on
April 20 the demand had again fallen off to near
the March 20 point. This slight fluctuation is at
tributable to the customary spring demand.
The demand for accommodations from city
banks has shown a greater fluctuation. There was
a steady increase in the demand from March 20 to
April 18 to the amount of slightly more than $12,000,000. April 20. however, brought a marked de
cline and loans to city banks are now about $2,000.000 higher than they were a month ago. With
drawals of state, county and other public funds
have been partially responsible for this fluctuation.
The month ending April 20 brought a slight de
crease in the reserve ratio of the Federal Reserve
System and also of this bank. On March 20 the
System’s reserve ratio was 79 per cent and on
April 20, 77.7 per cent, a drop for the month of
1.3 per cent. The reserve ratio of this bank on
March 20 was 78.7 per cent and on April 20, 76.3
per cent, or a decrease of 2.4 per cent for the
month.
Combined reports from 18 large savings banks
and trust companies in the Fourth Federal Reserve
District show a decrease in saving deposits of 5 1
per cent for March, 1922, over the corresponding
month for last year. Deposits for the same num
ber of banks on March 31 were 0.3 per cent less
than they were at the end of February of thi*
year.
'
**
Throughout the month the acceptance market
has been at a very low ebb and consequently ex
tremely dull. Both the supply and the demand was
weak. Few bills moved in this District at the
low rates which have prevailed this month, and
bills that did move were those maturing within
90 days. On March 11 rates were from 4 to \]A per
cent and on April 15 they had declined to
y/t per cent.
The domestic bills offered in this market covered
the following commodities: Crude oil, coal nipiron, wheat, oats, corn, steel products, knitted goods
hardwood lumber, window glass, and wool. Th ’
imports bills covered coffee and woolen rags The
export bills were for paints, auto tires, and ruh
ber goods.
Dealer’s comments on the acceptance market in
this territory for the past month indicate that il
has been very dull. During the latter part o f
March there was a little quickening of demand
but there was a very decided slump the fo r e o a l
of April. There have been very few offerings
and the rates have reached a point so low that'
they fail to attract the buyers in Ohio. Most of
THE M O N T H L Y
BUSINESS REVIEW
the customers are in a position to get a better
rate on their idle money than is offered by the
present market in bankers’ acceptances.
A careful survey of customers has been made and
almost without exception they declare that they
like acceptances, but that the rates are too low to
3
attract them at the present time, even if they were
in funds. A great many of them state that the
reviving business is absorbing what otherwise would
be idle funds. Without exception, however, they
state that they will be interested in acceptances
when other conditions prevail
Calculations of Iron and Steel Industry Disturbed By Coal Strike}
Output Continues Around 70 to 75 Per Cent; Prices Advance
The coal strike carrying with it an unexpected
defection of the non-union workers in the Connellsville regions, the key fuel district of the iron and
steel industry, has interjected a disturbing influence
into the iron and steel market after some weeks of
steady and promising development. Because of the
fact that the effective date of the strike was timed
with the usual Easter holidays in the coke regions,
the true character of the absence of the men from
duty is yet to be determined. Nevertheless the
situation has displayed certain possibilities which
have tended to unsettle some of the original con
fident calculations of the industry and it has had
the effect of arousing apprehension among both
producers and consumers over shortages of sup
plies and of giving the market a sharp turn. Trices
have been given a decided upward impetus all
along the line, ranging from $2 to $5 per ton and
these have come so rapidly as to arouse some anx
iety over a possible over-stimulation of the market.
The menace of the strike for the iron and steel
industry at present is more prospective than im
mediate. Most of the plants are in a comfortable
position for some weeks on fuel stocks; however
there is a belief in the trade that any extended pro
longation of the irregular operations in the Connellsville region would likely have far-reaching ef
fects in curtailing iron and steel output, and in
checking the growing demand for mill and furnace
products. Some blast furnaces have been forced to
bank by interruption of coke supplies, and various
others which were about to resume, have been held
idle. The chief deterrent resulting from the uncer
tainty caused by the strike, in fact, is that the placing
in commission of further iron and steel capacity is
being blocked.
At present the industry con
tinues to maintain an output of 70 to 75 per cent
which has been more or less stationary since
April 1. Operators are not inclined to put on ad
ditional furnaces and mills until they feel more
assured that these can be kept in uninterrupted
operation.
Barring the doubtful factor of the strike's influ
ence, the expansion of the iron and steel industry
both in market demand and production has con
tinued very favorable. Steel ingot production in
March was raised to the indicated annual rate of
32,500,000 tons, or to the basis of 74.3 per cent of
the high record yearly output of the country in 1917.
March represented a gain of 182 per cent over the
low point of July. Pig iron production in March,
according to the compilation of The Iron Trade
Reviciv, was 2,034,784 tons, the greatest in 14
months, and a gain of 404,604 tons over February.
Compared with the low point in July, the in
crease is 135 per cent.
Bookings of business by the mills and furnaces
in March were the heaviest in about two years
and the demand has shown no signs of tapering off.
The buying volume from the railroads, building
construction, automobile, general manufacturing and
jobbing interests has been keeping to a high rate.
Since January 1, the railroads have ordered ap
proximately 60,000 cars as against 28,000 in the
full year of 1921. This rate of buying is the larg
est since 1913 and greater than the average of the
past 10 years. Structural steel awards in March
totaled 139,300 tons, or 77 per cent of the country’s
shop capacity, the best showing since March. 1920.
Since April 1, fully 140,000 tons have been placed.
The price situation is well reflected by The Iron
Trade Rcvictv's average composite of 14 iron and
steel products. Since the low point of $32.80 late
in March, the composite during the third week in
April had been lifted to $34.02. This gain was the
first substantial upturn of the composite average in
18 months. By way of comparison, the high point
of the composite was $89.69 in August, 1917. In
April, 1913, the average was $27.74.
Lake Shipping Season Opens With Fair Demand For Bulk Freighters;
Miners Strike Causes Little Change in Lake Coal Shipments
The demand for tonnage during the early part
of the shipping season will not be great enough to
furnish employment for all the bulk freighters, but
the number of vessels that will be idle during the
period will be much smaller than it was in 1921
when down cargoes were very scarce and some
of the boats had to come down light for coal. Ac
cording to a line-up made by some of the shippers
and consumers who are interested in mines, some
of the furnaces will take forward considerable more
ore than they did last season. No orders have been
booked for 1922 delivery and it is not expected
that sales of any size will be made until some ac
tion is taken in regard to rail rates at both ends of
the route.
The start in the ore trade will be slow. Most of
THE M O N T H L Y B U S I N E S S REVI EW
4
the big plants have a good supply on hand and they
will be in no great rush to get started, but stocks
at some of the furnace yards are low and early
cargoes will be wanted at Cleveland and Buffalo.
Some sales of dock ore have been made and some
trading has been done in order to get certain
grades for mixtures, but the indications are that
there will not be much ore received at this end of
the route until the middle of May. The docks at
Lake Erie ports will be in better shape on May 1
than they were last year. The interior furnaces are
taking ore forward at a pretty fair rate and ship
ments from dock for April will show a good in
crease over February and March. There is less
ore in store at the furnace yards than there was
a year ago, and the movement for the season will
be much heavier than it was in 1921.
A number of early cargoes were delivered but
there was no great rush for coal on account of the
miners strike, in spite of the fact that the docks at
some of the upper lake ports cleaned up in better
shape than expected. Considerable coal was loaded
early for steel plants at Lake Michigan ports and
at this end of the route. Tonnage was lined up
to take about 100,000 tons of coal from Ohio ports
to Buffalo and some of the coal carriers were un
loaded at Toledo. Although the miners quit work
April 1, considerable coal was delivered at the lake
front last month, but the amount afloat at the
opening was not as great as it was in 1921.
Stocks of grain at the upper lake ports are much
heavier than they were a year ago, but aside from
the first trip, chartering has not been very active.
A number of boats are still holding cargoes at Lake
Michigan ports and at this end of the route.
Reports on Manufacturing Conditions, Taken as a Whole, Show Distinct
Improvement; Automobile and Truck Production Gaining
Various manufacturing lines show another dis
tinct improvement. The letters received from our
correspondents this month, giving reports on manu
facturing and business conditions throughout the
Fourth Federal Reserve District, are the most opti
mistic of any received since business started in the
right direction. Two months ago the betterment
following the turn of the year was reflected in the
reports taken as a whole. Last month the reports
indicated a more conservative increase in activity,'
while the first weeks of April have undoubtedly
brought increased spring production, partly due to
seasonal demand.
Automobile production continues to increase.
Orders for passenger cars are coming in at a good
rate and in some instances April orders are double
those of March. One large manufacturer reports
“ business even better than our expectations” .
The National Automobile Chamber of Commerce
reports that production of cars and trucks in the
first quarter of 1922 was 220 per cent of the first
quarter 1921. March shipments of all makers in
creased 32 per cent over February and were 65
per cent greater than March last year. The fac
tory shipping figures for all manufacturers are:
Carloads
Driveawavs Bv Boat
1922
1921
1922
1921 1922 1921
January 15,297 6,48a
7,467 3,185 143 93
February 19.636 9,986
10.173 7,507 180 99
March
*25,210 16,287 *15,804 9,939 264 75
•Partly estimated.
Practically complete production of passenger cars
for February was 109,005.
The truck business for the first quarter of 1922
in general shows a decided improvement over the
corresponding quarter of last year. A part of this
improvement has been brought about by the fact
that excessive stocks held by responsible dealers
have been reduced to a limited number.
A partial absorption of trucks that were held by
companies who liquidated business, and also the
marketing of Government owned trucks, as well as
trucks re-imported from the Kuropean battle-fields,
has also taken place. With those stocks out of
the way it is only natural that buyers must pur
chase trucks that have to be made by the manu
facturer. These things are reflecting themselves
in the output of the truck manufacturer.
A large truck company reports March as beine
the best month they have had in orders since
June, 1920, the orders exceeding any subsequent
month by about 20 per cent. Deliveries were the
best, with one exception, of any month since Sep
tember, 1920. Indications from all of their 40
branch offices throughout the country show a con
tinued gradual improvement over March business.
The construction of buildings now under way in
Cleveland is causing a stronger demand for trucks
for heavy hauling purposes.
Practically complete production of trucks w
February was 12,898.
The automobile axle business has shown a marked
improvement since last month. A large concern re
ports business now running at approximately 50
per cent of normal with prospects of a 75 per cent
output in May.
There has been no particular change in the hard
ware business since our last report. Prices are
low and competition keen. Retail business is look
ing better. Customers are still buying on a verv
conservative basis. An encouraging feature is that
buyers are paying for their goods as they get them.
There is a much improved feeling in the cork
industry over that of a few months ago. The de
mand is more active and several important plants
in the District are operating almost at capacitv
The outlook for the next two or three months
reported to be good.
,s
There has been a slow but steady increase in
the printing and lithographic ink business since the
THE M O N T H L Y B U S I NE S S REVIEW
first of the year. Trade with South America is slow
but in the Far East where considerable business
is done there is a better feeling.
In the tool manufacturing line, local business is
reported to have slowed down a little the last few
weeks, but the general tendency over the country
appears to be forward.
A further gradual improvement is noted in the
farm implement industry, but up to this time it is
confined principally to reports of dealers' stocks
moving rather than factory shipments.
The plate glass industry is running strong. A
large manufacturer reports operations at 90 per
S
cent of capacity, which is up to normal, and that
the production is being sold. At a recent meeting
of the company’s managers located in leading cities
of the country, a very satisfactory outlook was re
ported.
Business in electrical lines is picking up. March
sales of products used by railroads show a large
increase over those for February. In comparison
with the preceding five or six months, the past
month has evidenced a fair increase in demand be
yond what might be considered seasonal. The
radio industry continues to show a remarkable
growth.
Jobbers Slow in Ordering Supplies of Gasoline for Summer Trade; Domestic
Crude Shows Increase; Market for Gasoline Growing
March was a month of hesitation so far as the
buying of refined petroleum products was con
cerned. The prices of all refined products trended
upward throughout the month, this being especially
true of gasoline. However, buying was slow for
the reason that the jobbers over the country hesi
tated to make big commitments for summer busi
ness until they were sure that there could be little
chance of any reductions in the posted price of
crude oil. At the same time they realized that a
sudden entry into the market by jobbers for a big
quantity of gasoline would have the effect of stim
ulating the price. Stocks in the tanks of jobbers
are low all over the country, but they maintained
their hand-to-mouth buying policy. The weather
during March was generally bad over the country
and retail sales of gasoline were not very heavy.
Refiners quite generally, faced with a relatively
high price of crude oil on one side and a low price
for the products on the other, restricted their oper
ations during March as during February and Janu
ary, and for the most part ran their products to
storage, rather than sell them at prevailing prices.
Inquiries from jobbers to refiners seeking to con
tract for supplies of gasoline for the spring and
summer trade, increased considerably during March
over those of February. However, their offers
were, for the most part, rejected by the refiners,
because of the latter’s confidence in stronger prices
to come later in the season.
Fuel oil prices were generally low during March,
the demand being small due to restricted indus
trial activity, and the coal strike apparently not
being taken very seriously by fuel consumers.
Toward the end of the month, fuel oil demand in
creased somewhat, and gas oil began to move more
freely as the large gas companies came into the
market to contract for requirements covering three
to six months.
The fact that public utilities companies are usu
ally very close and intelligent buyers seems to in
dicate, through their extensive purchasing the lat
ter part of March, that they believe the bottom
has been reached. Gasoline buying declined some
what toward the end of the month, due to the fact
that both refiners and jobbers wished to hold off
on making commitments until after the jobbers
and refiners’ salesmanagers got together at the Na
tional Petroleum Marketers’ Association Conven
tion, which was held April 4 to 7, at Kansas City.
At that time both buyers and sellers expected to
be able to size up the situation more intelligently
and plan their policies for summer business.
Kerosene sales were slow throughout the month,
largely due to the absence of export demand which
in former years has taken up the surplus from do
mestic refineries.
Production of crude oil continued to increase
from week to week during March, especially in
the fresh pools of the Mid-Continent fields, and the
month showed, for the first time in two years, an
excess of domestic crude produced over crude con
sumed in American refineries.
The general belief is, however, that the demands
of the gasoline season, which is already opening
strong, will shortly take care of the excess and
bring crude stocks more into a line with consump
tive demand. At present the market for gasoline
is strong and other products are showing a sym
pathetic tendency upward.
Business in Canned Goods Continues in Fair Volume; Food Products
Business Shows Substantial Gain
Sales of canned goods have continued in pretty
fair volume since last month. Retail grocers re
port that spot stocks are moving into the con
sumers hands very well, although the sales as a
rule are still quite small.
Stocks held by the canners have been reduced to
a considerable extent. Canners, quite generally,
are in a much stronger financial position than they
were a year ago, and are looking forward to fur
ther improvement.
Asparagus packers have sold their entire output
for 1922 as futures, at a price somewhat higher than
opening prices for 1921.
Canners of sweet corn are reducing their acre
THE M O N T H L Y B U S I N E S S R EVI EW
age and are planting only enough to take care of
future orders, or an amount that they are able to
finance easily.
Spot tomatoes are in a strong position and are
commanding a good price. The tomato crop is
third in value of the vegetable crops in this country.
From 200,000 to 300,OCX) acres are devoted to this
crop annually for canning and manufacturing pur
poses. The yield is around 1,000,000 tons per
annum.
The past month has witnessed but little change
in the food products industry, but the increase in
business over March of last year is substantial.
The wholesale grocery business is reported to
be steadily improving. Retail grocers are also gain
ing more confidence. Stocks of goods in retailers
hands are light, and this fact coupled with in
creased confidence in values, is leading wholesale
grocers to expect a very good business with the
arrival of new pack goods about July 1. This
fact is also evidenced by the amount of future buy
ing done by the retail trade for delivery from new
packs.
Local Building Affected By Recent Strike; Outlook Grouting
Brighter; Exposition Plans Progressing
The building outlook has brightened considerably
since our last report. Many workers who were out
on strike a month ago have returned to work and
construction is again moving forward. Building
materials are inquired for in larger volume and are
moving from the retail yards.
While building operations in Cleveland have been
seriously affected by the strike called on March 1,
the figures for the leading suburbs indicate a marked
increase over 1921. Had it not been for the handi
cap of the strike it is easy to see how the house
building program would have forged ahead during
the early part of this year. For example, the value
of permits issued in Cleveland Heights for the
first three months of the year is $1,751,782 as com
pared with $1,182,735 for the same period last year;
Lakewood $1,699,815 as compared with $1,409,628;
Hast Cleveland $784,165 as compared with $263,210; West Park $426,420 as compared with $275,491. The aggregate increase for the leading sub
urbs of the city over last year for the first three
months is in excess of $1,500,000.
From these figures it is apparent that the clear
ing of the way for operations with a definite con
clusion as to wages and working conditions, w ill
provide a direct stimulus for the industry.
A healthy increase in building is reported in
Cincinnati. All types of buildings are represented
in the applications for permits, but dwelling per
mits are in the lead.
The Building Exposition to be held in Cleveland
is scheduled to open April 22 and is to continue
eleven days. The Exposition has been planned
with a view to stimulating the building of homes
and in addition to show types of heating apparatus
electric fixtures, labor saving devices, decorations
and furnishings. It is being staged under the aus
pices of the Builders Exchange and is the first of
its kind to be held in Cleveland since 1916.
The total of building permit expenditures of 154
leading cities reporting to Bradstreefs for the
month of March is $234,288,294 as compared with
$130,245,280 in February, and $117,994,780 in
March a year ago. This is a gain of 72.1 per cent
over February and of 98.6 per cent over Matrh
1921.
cn ’
Improvement in Basic Industries Reflected in Pulp and
Paper Business; Orders Slightly Larger
Business in the pulp and paper industry has been
quite slow during the past few months, but at
present there are indications that business is grow
ing. Orders are now coming in at a better rate
and with more satisfactory specifications than for
some months past.
Manufacturers and merchants who attended the
annual convention of the American Paper and
Pulp Association recently held at New York, look
to the future with confidence. The meeting was
described as a starting point of a forward move
ment all along the line in the placing of orders to
fill up the depleted stocks.
The improvement in basic industries throughout
the country has already reflected an increased ton
nage in the paper mills, as the small stocks quite
generally carried by the consumer, are not suffi
cient to meet the needs of any material advance in
business. It is estimated that stocks at the mills on
the merchants’ shelves, and in the hands of the
printers and consumers, are lower than they have
been for perhaps two years.
The demand for fine paper is continuing at about
75 per cent of normal. Coarse papers are slowlv
working back toward normal and orders are in
creasing. Production of wrapping paper was esti
mated at 50 per cent of normal a short time a«>~
News print mills are running at about 85 per cent
capacity.
According to a report of the American Paoer
and Pulp Association, news print consumption has
been running heavy since last October. Sixty odd
newspapers in the United States of more than 100000 circulation each averaged more pages daily and
Sunday combined in March, than during any orev.
ious month on record.
The anticipated spring pick-up which is cus
tomary in the paper box and box board business
was not very strong. From this time until July £
the usual dull period. Prices on box board are still
quite low, and orders are small.
THE M O N T H L Y
BUSINESS REVIEW
1
Tire Production Gaining; Orders From Automobile
Companies Larger
The rubber industry has shown a slow but the high point, while buying for the coming sea
healthy improvement during the past month. This son is not yet under way. Belting and other rub
is true not only of the larger companies which have ber products required in industry is reported to be
been on the up grade for some time, but it also showing a gradual improvement.
applies to smaller concerns. For a time the im
The India Rubber Review, after a careful sur
provement was noticeable principally in the Akron
vey,
is of the opinion that caution is still needed in
district. The steady demand for tires, however, is
the
tire
industry. In this connection it says: “ That
being reflected in larger production by companies
the
tire
industry as a whole, however, has ex
outside of the Rubber City which until recently
panded
beyond
present needs is apparent. During
were operating their plants on a largely cur
the war period factories were expanded to take care
tailed basis.
of war-time tire requirements, and also tire de
Reports indicate that dealers as a whole have
very small stocks on hand, and will have to be mands which were based upon the use of five or
dependent to a large extent upon production dur six tires per car a year, whereas the increased qual
ing the next three months to supply tires for the ity of tires now produced has decreased this de
motoring season which is at hand. Sales of tires mand to approximately three tires a year with re
to automobile companies are showing a steady sulting plant equipment for which demand must
be postponed for at least several years.”
increase.
The crude rubber market is holding rather firm.
There have been no particular changes in the
mechanical rubber goods business. The market for Buyers of crude rubber are showing more inter
rubber heels is very good and is even better than est than they did a month ago, and are watching
before the depression set in. The demand for market developments closely, but the volume of
boots and shoes for the spring season has passed transactions is small.
Coal Production Drops As Result of Miners Strike; Considerable
Reserve Supply in Hands of Consumers
The last few weeks prior to the coal strike
brought out a final spurt of activity which carried
the production of soft coal up to 11,448,000 tons
in the week ending March 25. The output was
the largest recorded since December, 1920. Pro
duction during the week ending April 1 declined to
10,463,000 tons according to a recent report of the
Geological Survey.
The first week of the miners strike brought a
sharp drop in production. Complete returns of coal
loaded into cars at the mines indicate that produc
tion during the first week of the strike was 3,784,000 net tons of bituminous coal and a few cars
of anthracite dredged from the rivers. The total
production of all coal was estimated at 3,793,000
tons as against 5,590,000 tons during the first week
of the 1919 coal strike. At that time, however,
anthracite mines were working to capacity and
produced 2,008,000 tons.
The Survey states there are additional evidences
that the country was heavily stocked with coal on
April 1. In addition to the coal held by consum
ers, the coal on the upper lake docks and in storage
at the mines, there was a heavy tonnage in cars
at the mines for which no billing orders had been
received by the railroads when April 1 arrived.
The total quantity of coal unbilled in cars on that
date exceeded 1,400,000 tons of bituminous and
115,000 tons of anthracite.
It is estimated that around 3,000,000 tons of soft
coal were added to the consumers’ stock piles by
the final spurt in production during the week prior
to the strike, which would bring total stocks in the
hands of consumers on April 1 to approximately
63,000,000 tons. The present rate of consumption
and shipments abroad is about 8,300,000 tons a
week.
Production of anthracite coal practically ceased
during the first week of the strike. Railroad rei
ports of loadings show that 172 cars were shipped
during the week ending April 8 of which 27 were
left over from the week preceding, and 145 were
the product of river dredges. Based on these load
ings, the total output is estimated at 9,000 net
tons.
Farmers Start Spring Work; Acreage of Burley Tobacco Undecided;
Poultry Business Important
Spring work on the farms has been delayed somewhat by rain, but farmers have taken advantage
of the good weather and have made progress in
getting the soil ready for spring planting.
The winter wheat crop in most sections of the
Fourth District has wintered quite well. Some of
the fields, however, are spotted as a result of the
severe weather last January and February. There
has been less than the usual amount of freezing
and thawing this spring with the result thUt wheat
THE M O N T H L Y B U S I N ES S REVI EW
8
fields are already taking on a healthy color. But
it is still too early to make any exact estimate of
the wheat crop production, for quick changes in
the weather such as occurred last year make spring
estimates very uncertain.
The United States rye crop April 1 showed a
condition of 89 per cent compared to 90.3 per cent
April 1, 1921, and 88.5 per cent average on April 1,
for the last 10 years.
According to a recent report of the Ohio De
partment of Agriculture, the average farm wage on
April 1 for the state of Ohio was $32 a month
which is a reduction of from $8 to $10 a month
from the wages paid a year ago. The supply of
labor in most sections of the state is amply suffi
cient for all needs.
There is nothing especially outstanding in the
burley tobacco situation at this time. The tobacco
is now all in and most of it has been in for the
past two or three weeks. The Marketing Associa
tion is placing the tobacco which has not been
sold into hogsheads for storage purposes and it is
probable that sales of tobacco in hogsheads will
be made later on in the season when the tobacco
ha-s gone through the “June sweat” .
The growers appear to be very well satisfied
with the results obtained by the Association up to
this time. At present there are over 55,000 growers
in the organization.
It is still too early to determine what the acre
age for the present season will be, but it is ex
pected that a somewhat larger crop than last year
will be planted in view of the fact that last year’s
acreage was below the average.
Plans for establishing a marketing organization
among the dark tobacco growers of western Ken
tucky, similar to the one in the Burley field, are
being pushed forward and the interest seems to
be very keen.
There is no question but that the proceeds from
the sale of last year’s tobacco crop have been o f
great benefit to the farmers of Kentucky, and reports all indicate a decided improvement in busi
ness in that part of the District.
The consumption of eggs has increased with re
markable rapidity in the country during the past
two years, according to reports received by the
Ohio Division of Markets ot the State Agricultural
Department.
The egg business, which is now one of the
important industries of the country and occupying
the attention of market men, as well as producers,
more than ever before, is of great concern in Ohio!
It has established itself here in a very firm wav
and has ramifications throughout the entire state.
Ohio has become one of the largest egg producing
sections of the entire country. Beyond furnish
ing a supply sufficient to meet the" needs of its
own people, and they are not small, thousands of
cases are shipped to outside markets. In 1920
the producers here sent 300,000 cases to New York,
or 9,000,000 dozen. But this grew enormously in
1921 when the New York market took 457,839
cases or 13,735,170 dozen, an increase of more than
25 per cent.
Many men, in Ohio and other states, and women
as well, are realizing the rapid growth in the de
mand for eggs as an article of daily use. As a
result, increasing numbers are constantly going
into the raising of chickens, the egg laying quali
ties of which are the most pronounced. It has
proven a successful line of industry to those w ho
operated along scientific lines and make egg pro
ducing a matter of careful study.
Textile Industry Shows a Little More Confidence; Warm
Weather Brings Out Retail Trade
There appears to be a somewhat better feeling
in the textile industry in the Fourth District than
there was a month ago. Whether this slight im
provement has been brought about by a more con
sistent demand for merchandise, or because many
of the large mills in the east are closed down
on account of strikes, which naturally causes de
pleted stocks sooner or later, the fact remains that
the demand has been picking up a little during
the past two weeks.
Reports from manufacturers of fancy knit goods
indicate a somewhat uneven activity. As a rule
it is customary to start work on materials for the
coming fall by March 1, but so far there has been
less than the usual amount of work in this direc
tion.
There has been no particular change in the knit
underwear business during the past month. Weather
c o i t i o n s have been partially responsible for the
slack demand for spring goods for immediate de
livery. The big department stores have been or
dering slowly and this is also true of the small
retailers. Within the past ten days, however, a
slight betterment appears to be taking place, par
ticularly in the larger stores which are coming into
the market with larger orders.
Manufacturers of men’s and women's clothing
are marking time to some extent awaiting the
results of opening up of fall lines. The undertone
generally is more optimistic than it has been for
several months. While the late Easter together
with unsettled weather conditions delayed the
opening up of retail trade, the few warm days we
have had appeared to bring out substantial retail
business.
The new wool clip is reported to be fairly satis
factory. Prices of wool are continuing high
The strike among New England workers still
continues and more men are reported to be idle
than at any previous time this year. Labor trou
bles among the textile workers in Great Britain
are also being experienced.
THE M O N T H L Y B U S I N E S S R EV I EW
9
No Particular Change in Transportation Situation
Shown Through March
During March there was a large increase in the
movement of freight traffic in this territory, this
being a continuation of the improvement which
has been noted so far this year. Up to this time
no complete figures for April showing the effect of
the coal strike have been given out.
The total operating revenue for the eastern dis
trict for February, 1922, showed an increase of 4
per cent over the same month in 1921, and there
was a net revenue of almost $28,000,000 as com
pared with a deficit of over $7,000,000 last yean
Reports of 200 Class 1 railroads filed with the
Interstate Commerce Commission show that Janu
ary operating revenues aggregated $394,940,789 dr
16 per cent less than in the corresponding month
of last year, while operating expenses were $337,142,000 representing a decrease of 23.7 per cent
from January, 1921. The operating income totaled
$29,476,422 as against $51,588,000 in December.
Passenger traffic on Class 1 railroads decreased
20 per cent in 1921 as compared with 1920.
The number of bad order cars on March 1 was
334,628, this being an increase over the number
reported on February 28 at which time there were
272,867 cars awaiting repair. On March 15, how
ever, the number had decreased to 154,499. On
January 1 of this year there were 313,190 bad
order cars. It is estimated that between 14 and 15
per cent of the total freight car equipment of the
country’s railroads is still unfit for service.
Until the beginning of the coal strike the num
ber of idle serviceable freight cars showed a steady
decrease since the first of the year. On December
31 the number was 470,516; on January 31, 330,681:
on February 28, 245,100, and on March 31, 206,746.
A Special Survey on Farm Implements
In the Egyptian quarter of the British Museum,
standing humbly in a glass case between two mum
mied Pharoahs, is a little group of farm utensils, A
broken wooden plow, a rusted sickle, two sticks lied
together with a string, and several tassels that had
hung on the horns of the oxen. These were found on
the banks of the Nile three thousand years ago. Egypt
had a most elaborate government at that time. She
had an army and a navy, an art and literature. Yet
her bread-tools were no better than those of the bar
barians whom she dispiscd. It is one of the most
baffling mysteries of history, that agriculture—one of
the first industries to be learned, was among the last
to be developed.
The traditions of agriculture, the industry of in
dustries, reach back beyond the date of written rec
ords. Together with hunting and fishing it shares
the distinction of being one of the oldest of human
activities. Because of the traditions in which the art
of agriculture has been enveloped, changes have been
slow in coming. Just as practically all new inven
tions, which have proven themselves to be of lasting
benefit to society, have had to pass through “a trial
as by fire,” just so were the infant ideas that hand
work on the farm could be replaced by machinery,
ridiculed. The men who dared to think such foolish
things were branded as “ dreamers," and persecuted as
enemies of society.
The first railroad was torn up. The first telegraph
wires were cut. The first sewing machine was
smashed. The first man who sold coal in Philadelphia
was chased out as a swindler. The first iron plows
were said to poison the soil, while horses shied when
they say the first unwieldy reaj>er, and farmers laughed
and declared they would stick to the old-fashioned
cradle.
But the development did come. The crude, unwieldy
tillage tool of the ancients has been replaced by the
smooth-running modern plow—the fundamental farm
implement. The self-binding harvester has taken the
place of the tiny hand sickle and the back-breaking
grain cradle. The threshing machine lias supplanted
the flail. And in place of slow plodding oxen is the
“ iron horse”—the modern gas tractor—ready to chug
its way across the fields twenty-four hours" each day
without tiring.
Modem farm machinery is the answer to the far
mers call for shorter hours, less heart-breaking toil and
greater financial returns. The American farmer has
not become the most up-to-date of all the agricultural
peoples of the world for the mere pleasure of an ex
periment, but because by using modern methods he can
produce more food and cheaper food under the eco
nomic conditions with which he is confronted.
It is almost impossible to realize what this com
plete change has meant to food production. The
period before 1860 may be considered one of hand
production and since that date—or at least since 1870
—that of machine production. The following table
taken from The Influence of Farm Machinery On
Production And Labor9 is based on a very careful
study of all data available on the subject:
M
an
L abor
Man-Hours Required for Production
Crop (1 acre)By Hand By Machine
Barley ...................................
64
3
Corn .....................................
39
15
Cotton ...................................
168
79
Hay .......................................
21
4
O a ts.......................................
66
7
Potatoes ................................
109
38
Rice .......................................
62
17
Rye .......................................
63
25
Wheat ...................................
61
3
The plow is our oldest agricultural implement. An
cient monuments, dating back forty centuries, bear
10
THE M O N T H L Y B U S I N ES S REVI EW
sculptured representations of the plow. As early as
1100 B.C., two thousand years before the horse was
harnessed to the plow, the Israelites, who were un
skilled in working iron, “went down to the Philistines
to sharpen, every man, his share and his coulter.” (A
coulter is a blade or disk on the beam of a plow
to cut the sod.)
History does not give the name of the first plow or
the name of its inventor. Perhaps the snout of a wild
hog in its quest for grubs suggested the shape, and
a budgeon sharpened to a point was the crude imita
tion. Later a widening of the point into a chisel shape
made the instrument more efficient in its work. Grad
ually improvements were added, but the real change
came in 1837 when John Deere, a blacksmith at Grand
Detour, Illinois, built three steel plows, one of which
is still in existence. Then near the close of 1873 James
Oliver whose name is still linked with the chilled plow
in all parts of the world, perfected the chilling proc
ess. From that time there lias been a steady im
provement and today, the land that was once scratched
with the aid of a crooked stick, is now turned in long,
even furrows by the trim walking plow, the up-to-date
sulky, and the gang plow for traction plowing. All
of this has gone far in relieving the farmer of bur
densome toil.
Different soils require different types of plows. A
plow with its working parts made from soft-centered
steel is popular in the west, while in the east the chilled
plow gives the most satisfaction.
Plow manufacturers count quite a lot on replace
ment business each year. There is a particularly heavy
wear on the moldboard, landside, and share, which
means that these parts must be replaced frequently.
A year in which there is less than the usual amount
of rainfall means more business for the plow manu
facturer. Dry, hard soil makes plowing more difficult
and consequently a larger replacement business for
the manufacturer.
While the plow is the basic tillage tool, many others
are used in the preparation of the soil for the seed,
and in caring for the growing crop. Next to the plow,
the harrow seems to be the tool most common to
eastern and western farms. Spike-tooth, spring-tootli.
and various types of disk harrows are among the most
important, and are used principally for leveling and
pulverizing the soil. The disk harrow has won con
siderable popularity within the past few years. It is
an all-around harrow being adapted to a variety of
conditions. It is generally used in preparing plowed
land for corn or other crops, in preparing corn-stubble
land for oats in the spring or for wheat in the fall,
in cultivating alfalfa, and, in recent years, in harrow
ing sod previous to breaking.
The roller is a tool that is used to pack the soil
in dry weather, mash bumps and level the land.
It is efficient in the preparation of the seed-bed when
properly used, but when improperly used it does more
harm than good.
Cultivators and weeders are also important factors
in the division of tillage tools. In some sections of
the east the walking cultivator is still in general use,
but on the larger farms the sulky cultivator has
replaced the old-style method.
Various types o f
weeders are also extensively used for stirring the soil
after spring crops are planted—chiefly corn and po
tatoes.
Seeding machinery is used in planting the crop.
This work is very vital and the importance of proper
selection, care and adjustment of seeding machinery
must not be overlooked. A field may be fertile, the
soil properly prepared, but without proper seeding,
good crops cannot grow. Corn and potato planters*
grain drills, and grass seeders may be classed under
the head of seeding machinery.
As a labor saver and a source of profit, the manure
spreader has come to be regarded as a necessity on
the farm. The need for proper application of lime
in its various forms for the purpose of correcting
soil acidity, has also brought about a wide use of the
lime spreader.
Harvesting machinery comes next. This is a very
important branch of the farm implement business and
for several reasons. Few operations on the farm can be
as completely carried out by machinery as that of har
vesting. While complete equipment means quite a
heavy investment, the investment pays for itself not
only through a saving in labor, but through value
added to the crop by promptness in caring for it. A
noted authority on farming hit the nail on the head
when he made this statement: “ Any farmer who real
ly needs a farm machine and does not buy it, is paying
for it whether he buys it or not.”
Haying machinery includes mowers, rakes, tedders,
hay loaders, barn equipment, and stacking tools. In
all of these, improvements have been made. The
mower does better work with less power; the modern
self-dump rake has proven its superiority over the
older wooden frame, wooden wheel, hand dump style*
the advent of the loader which did away with the
tiresome hand-method of loading, especially in flat
farming sections, created a demand for the side-delivery rake; the tedder makes possible the speedv
drying and curing of a heavy hay crop; and the mod
ern barn equipment and stacking tools complete the
job.
Early in our story we told how the sickle and the
cradle have been supplanted by the modern grain
binder, now used in almost every country in the world
McCormick spent the best years of his life before
he succeeded in convincing the skeptical public that
his reaper was something worth while, but he had
the satisfaction of seeing his dream come true. It
has been said that the reaper “ pushed the American
frontier westward at the rate of thirty miles a year.”
Most of the western railways followed the wheat
and wheat money paid for them. The reaper clicked
ahead of the railroad, and civilization followed the
wheat from Chicago to Puget Sound, just as the
self-binder is leading the railroad today. It is still far
ahead in Western Canada and even farther in Siberia
During the Civil War the reaper did the work of a
million men in the grain fields of the north and made
possible the successful termination of the war. The
binder with the aid of its allies—modem farm imple
THE M O N T H L Y
BUSINESS REVIEW
ments—played the same important role in the World
War, and even on a larger scale.
Threshing completes the journey of the grain on the
farm. Solomon said “ There is no new thing under the
sun.” Modern threshing methods are new but thresh
ing is old. The ancients taught us how to thresh.
Threshing is the removal of the grain from the head;
separating is the removal of the straw. Lastly, the
chaff is removed—that is cleaning. The ancients did
the work with flails or oxen. Today an up-to-date
threshing outfit combines all the operations and it is a
success because it is an improvement over the old
method.
There was a time when practically all the thresh
ing throughout the country was done by men who
owned threshing outfits. They traveled about from
farm to farm. But this system very often caused delay
which resulted in the loss of grain. The past few
years has brought a change. Neighboring fanners
have gone together and bought outfits of their own.
They no longer wait until late in the season to thresh
their grain.
Labor conditions and the use of the gas tractor,
are resulting in the use of smaller threshers. Very
frequently farmers have found it impossible to securc
sufficient men to do the work required by a big thresh
ing outfit. Then, too, paying for the labor is expensive
while exchanging work at threshing time, as farmers
sometimes do, is very inconvenient to say the least.
Little threshing machines have been called grain insur
ance policies.
The housewife has something to say about it too.
Of all the days in the year, none are dreaded as that
one when the threshers are expected. Even worse
than the heavy work for the busy farmer’s wife is the
uncertainty. Largely due to the weather, threshers
can never be depended upon. The roast may spoil
if they are a day late and that means that the prize
pullets will have to be killed for “ nothing is too good
for the threshers,” and besides, if the meal is not up
to the high standard of the community, the farmer s
wife is certain to hear about it, if by chance she ever
11
‘listens in” on the telephone. Smaller threshing out
fits make work lighter for the farmer's wife.
It is practically impossible to tell the many interest
ing and important things that should be told about the
growth of the farm implement business. The ensilage
cutter is an example of what a new kind of machinery
on the farm can do. This machine has revolutionized
the dairy industry. Heading a properous implement
manufacturing concern in the Fourth District is the
man who invented the “ blower” type of ensilage cutter
that made the high silo possible and it was he who
suggested the idea for the first round silo.
And so the improvements have come; each im
provement making life on the farm a bit brighter,
the work less burdensome, the results more pleasing,
the returns larger. Modern farm machinery has
placed the American farm on a higher plane and
has moved the United States far away from the
bread line.
It is necessary to add, however, that the farm im
plement industry is still at the bottom. But for the
most part, it is rock-bottom, and already reports are
coming in that sales in some localities are showing
a slight improvement. Buying during the past few
years has been very light and the farmers have been
making their old machines last as long as possible. A
sure indication of this is the heavy replacement
business.
Quite a number of large farm implement manu
facturers were interviewed in connection with the pre
paration of this survey and every one of them reported
growing evidences of the need for new machinery
on the farms.
Scientific agriculture is still young. Step by step
fanning is becoming a sure and scientific profession.
The risks and uncertainties that formerly tossed the
farmer back and forth, between hope and despair,
are being mastered. The New Farmer is facing a
brighter future.
NOTE:—In the next issue of the Review we
{Jan to publish a survey on power farming.
THE M O N T H L Y BU S I N E S S REVI EW
12
The Story Of Our Fiscal Agency Department
The duties performed by the Federal Reserve banks
as fiscal agents of the United States have been delegated to the banks by the Secretary of the Treasury
under the authorization of a brief clause forming a
U r £? *• 1 e £ 4.1 r* i
part of the first paragraph of Section 15 of the I’ ederal Reserve Act: “------which banks, when required by
the Secretary of the Treasury, shall act as fiscal agents
of the United States; ---------Since this provision
appeared in the original text of the act as approved
»«f
t
«
• t
*•
r
December 22, 1913, the magnitude and importance of
the operations subsequently to be performed thereunder
by the Federal Reserve banks could not then have been
fully realized by anyone. Its simplicity is one of the
chief merits of the provision, for it required the Reserve
banks to perform any duty the T reasury considered advisable to delegate to them in the emergency of the
unprecedented era of Government war financing which
began early in the year 1917 and which still continues. From a financial point of view, the war is not
yet over.
This article is not a history of war financing, but
inasmuch as the duties of the Fiscal Agency Department are the result mainly of such operations, probably
brief mention of a few matters of interest in that
connection will not be out of place. In its contribution to the financial assistance of the Government, the
Fourth Federal Reserve District has ranked third,
being exceeded only by the Second District (Federal
Reserve Bank of New York) and the Seventh District (Federal Reserve Bank of Chicago); the proportion of the total of the various issues taken by subscribers in the Fourth District has been approximately 10
per cent. The immediate financing of the war was accomplished by the issuance of short-term notes, called
Treasury certificates of indebtedness, to be retired subsequently by the proceeds of long-time loans or taxes,
The first issue of Treasury certificates in recent years
was dated March 31, 1917, and was for an aggregate
amount of $50,000,000, of which the Federal Reserve
Bank of Cleveland took $3,500,000. Beginning with
that issue, the Fourth Federal Reserve District has
participated in 96 issues of Treasury certificates and
notes and has received and paid for allotments aggregating $3,275,000,000. Of course, it must not be inferred that this amount represents in its entirety new
funds absorbed by the Government, because many of
the issues were in effect partially or wholly refunding operations, a recent illustration of which was
Series A 1926 four-year Treasury notes dated March
15, the entire allotment of which was paid for in
per cent Victory notes, maturing May 20, 1923.
The amounts of the various Liberty loans were
as follows:
T<>tai Amount
F™lthmFSmi
........
.
R” " v'i^i,trict
$203,300,050
lMrst Llberty L®3" ............... $1,989,455,550
Sccond Libcrty ^
............. 3,807,865,000
410,352^450
Third Liberty Loan .............
Fourth Liberty Loan ..............
Victory Liberty Loan ............
4,175,650,050
6,964,581,100
4,495,374,300
At
7I7TITII7IZ
1otal ............................... $21,432,926,000
405,051,150
701,9091800
443,802,250
TTTi---------$2.164415 700
' ’
Agency Department handled the pavments / or
Liberty Loan bonds and notes allotted to
subscribers in the Fourth District, although most of the
Payments were made in the first instance to firms, corPora^ons and banks. 1 he firms and corporations turned
over t{ie amounts they collected to the banks and the
banks in turn remitted to the Fiscal Agency Department,
which credited the account of the Treasurer of the
United States on the books of the Federal Reserve Bank
and the funds were then available for payment of the
expenses of the Government. As a matter of fact, a
large proportion of the funds to be realized from each
^ie Liberty Loans except the First was expended
hy the Government in advance of their flotation,
through the previous sale to the banks of Treasury
certificates of indebtedness, the banks turning in such
certificates as payment was received by them from the
individual subscribers, firms and corporations. As the
payments were received and entered, the Fiscal Agency
Department, from stocks furnished by the Government, delivered or shipped the securities to the hanks,
It would have been physically impossible for the
Federal Reserve Bank of Cleveland to collect the payments for and handle the distribution of these vast
amounts of securities had the operations not been
facilitated by the splendid co-operation of the banks
of the district, and a major portion of the
credit for its successful accomplishment is due
to the banks of every locality which spared neither eff°rt nor expense in handling the numerous details
connected with the receiving of subscriptions from
their customers, the collecting and transmitting of payments and the delivery of the securities,
As a corollary to the flotation of the Liberty Loans
the performance of numerous other duties from t‘ *
to time has been required of the Federal Resent
banks, among the more important of which mav hi
mentioned the following:
Treasury certificates of indebtedness and Treas
note—subscriptions, allotments and payments
^
Conversion of First 3 ^ ’s into 4’s and 4% ’s
THE M O N T H L Y
BUSINESS REVIEW
Conversions of First 4’s and Second 4’s into 4% ’s.
Conversion of Victory 3•;:i,s into 4'}4’s and vice
versa.
Redemption of maturing coupons detached from U.
S. Government securities.
Redemption of maturing Treasury certificates of
indebtedness.
Redemption of Victory notes.
Exchanges of denominations.
Exchanges of temporary bonds for permanent ones.
Exchanges of bonds and notes from coupon form
into registered form and vice versa.
Transfers of ownership of registered bonds and
notes.
The conversions of First i l/z s into 4’s and 4%\s
were operative for limited periods only and the con
versions of the Victories also now have been ter
minated, but the other functions mentioned continue
to the present time and all of them, with the exception
of transactions in connection with securities in regis
tered form, are now performed also by the Cincinnati
and Pittsburgh Branches. The Fiscal Agency Depart
ments of our three offices carry unissued stocks of
the securities of all outstanding Government issues
from the First Liberty Loan to date and are pre
pared at all times to render immediate service in the
exchange of denominations within an issue, the delivery
of bonds in permanent form in exchange for tem
porary bonds, and the delivery of First 4j4’s ami
Second 414 ,s in exchange for First 4’s and Second 4*s
respectively. However, exchanges of coupon for reg
istered or registered for coupon bonds and notes and
transfers of ownership of bonds and notes in registered
form are submitted by us to the Treasury Department,
since all registration records are maintained there;
consequently, such transactions require at the present
time an interval of about fifteen days for functioning
and delivery of the new securities.
Individuals, firms and corporations will find it ad
visable to entrust all matters of this sort to their bank
ing connections, as most banks are more or less famili
ar with the requirements of the Treasury Department
and have supplies of the prescribed forms; the banks
also are in most instances prepared to forward securi
ties to the Federal Reserve bank under proper safe
guards at nominal expense.
The brief outline presented herein of the functions
performed by the Fi>cal Agency Department may con
vey the impression that the various operations are com
paratively simple, but the clerical work of the de
partment includes many intricate accounting problems
and most of the operations involve the handling of vast
amounts of securities in a limited space of time and
with absolute accuracy. Most of the other departments
of the Federal Reserve Bank arc required to restrict
their dealings to the members of the Federal Reserve
System, numbering 883. but the Fiscal Agency Depart
ment recognizes no such distinction and transacts busi
ness with all banks of the district, numbering 1,968,
and with corporations, firms and individuals. At the
present time about 75 employes are assigned to the fis
cal agency work, although on a number of previous
occasions a considerably greater number has been
required.
13
Interesting deductions may be drawn from some of
the totals compiled. For instance, during the year 1921,
we redeemed 9,132,000 United States coupons, aggre
gating in value $62,120,000. Assuming that such cou
pons represented one year's interest at 4% per cent,
the par value of the United States securities from
which they were detached equals $1,461,647,000; con
sequently, that amount of such securities apparently is
lodged in the Fourth District and owned by its resi
dents.
Usually the physical bulk of valuable securities is
not particularly embarrassing to the holder, but the
Federal Reserve Bank of Cleveland, on a number
of occasions during the past five years, has found
its vaults seriously congested with large accumula
tions of such valuables. Dealers in many commodi
ties are accustomed to carload units, but probably none
of them has ever in his most optimistic moments
considered the necessity of handling United States
Government bonds by the carload. It is a fact, how
ever, that the securities handled by the Federal Re
serve Bank of Cleveland since early in 1917 would
have filled to capacity quite a number of railway mail
cars. During the year 1921. the Fiscal Agency De
partment handled 4,725,000 pieces of bonds, notes and
Treasury certificates. Were that number of pieces to
be piled flat one upon the other, they would make
a column over 2,200 feet high.
During the war and for some time thereafter the
allotment of Treasury certificates of indebtedness was
simplicity itself; liberal subscriptions were desired
and all of them were allotted in full. In fact, for a
considerable period the Fiscal Agency Department em
ployed a sales organization of about 25 men actively
soliciting subscriptions from banks. The response of
the banks was very gratifying and it is no exagger
ation to state that hundreds of banks purchased to the
extreme limit of their ability. Except among the
banks and a comparatively few large corporations,
there was 110 market at that time for the short-term
issues, and sales subsequent to the primary distribution
were infrequent. Within the past two years, however,
the distribution among investors has become quite
general and the sales organization has been dis
banded. The quota of the Fourth District is 9.06 per
cent of each offering, and it is invariably over
subscribed. At the present time all of the outstanding
issues are quoted above par, and there is a broad, open
market. In accomplishing this recognition for the
world's premier short-term security, the Treasury and
the Federal Reserve banks have enjoyed the invalu
able assistance of the banks and of many investment
firms.
It is hoped that this article will furnish the reader
with some idea of the character of the duties of the
Federal Reserve Bank as an intermediary between the
Treasury Pej>artment and the lxmks and the public in mat
ters connected with Government securities. Had the
Federal Reserve banks not been in existence, the Sec
retary of the Treasury undoubtedly would have found
it necessary early in the year 1917 to establish regional
organizations of some sort to handle the vast amount
of detail incident to the financing of the war, for
obviously it would have been impracticable to cen
tralize in Washington all of such activities.
14
THE M O N T H L Y B U S I N E S S R E V I E W
Debits to Individual Accounts
(In Thousands of Dollars)
Akron............................
Butler, Pa.*.................
Canton*........................
Cincinnati....................
Cleveland.....................
Columbus.....................
Connellsville*...............
Dayton.........................
Erie..............................
Greensburg...................
Homestead*.................
Lexington.....................
i*
Lima*
Lorain * . ..........
New Brighton*.
Oil City...........
Pittsburgh.......
Springfield.......
Toledo.............
Warren, O .* ...
Wheeling.........
Youngstown. . .
Zanesville*. . . .
Total...
* HpMn
Week End
ing Apr.
12,1922
(326 Banks)
Week End
ing Mar.
15, 1922
(326 Banks)
$ 14,128
2,344
9,102
79,892
146,025
33,190
1,032
12,217
5,969
3,785
636
4,559
3,614
1,302
1,973
2,456
155,284
4,738
37,119
1,954
7,901
12,845
2,979
$ 10,858
1,833
5,819
65,404
107,572
28,849
995
11,610
6,737
4,047
597
8,246
3,280
1,032
1,885
2,591
135,431
4,012
27,492
3,295
7,300
10,642
2,638
$545,044
$452,165
Increase or Decrease
Per Cent
Amount
$ 3,270
511
3,283
14,488
38,453
4,341
37
607
— 768
— 262
39
— 3,687
334
270
88
— 135
19,853
726
9,627
— 1,341
601
2,203
341
$92,879
30.1
27.9
56.4
22.2
35.7
15.0
3.7
5.2
—11.4
— 6.5
6.5
—44.7
10.2
26.2
4.7
— 5.2
14.7
18.1
35.0
—40.7
8.2
20.7
12.9
20.5
Week End.
ing Apr.
13,1921
(274 Banks)
$ 15,008
Increase or
Amount
—$
880
72,842
146,850
35,874
..... •.
13,128
6,267
3,865
..............
4,181
7,050
— 825
— 2,684
•.«. .
— 9ii
— 298
— 80
' **378
2,367
159,922
4,693
26,273
..............
8,150
14,217
89
— 4,638
45
10,846
— 249
— 1,372
$513,637
$6,471
Per Cent
— 5.9
9.7
— 0 .6
— 7.5
••« . . .
— 6.9
— 4.8
—
2.1
9 :6
3.8
— 2.9
1.0
41.3
— 3.
— 9.
1.3
Comparative Statement of Selected Member Banks in Fourth District
(In Thousands of Dollars)
Loans and Discounts secured by U. S. Government
obligations.....................................................................
Loans and Discounts secured by other stocks and bonds..
Loans and Discounts, all other............................................
U. S. Bonds...........................................................................
U. S. Victory Notes..............................................................
U. S. Treasury Notes............................................................
U. S. Certificates of Indebtedness.......................................
Other Bonds, Stocks and Securities.....................................
Total Loans, Discounts and Investments............................
Reserve with Federal Reserve Bank...................................
Cash in Vault......................................................................
Net Demand Deposits..........................................................
Time Deposits. •.. .#..............................................................
Government Deposits..........................................................
Total Resources at date of this report................................
Apr. 12,
1922
(85 Banks)
Mar. 15,
1922
(85 Banks)
39,404
326,722
606,810
125,683
4,965
24,446
10,221
272,436
1,410,687
92,177
27,510
800,284
468,902
12,711
1,812,189
42,146
324,830
602,070
123,074
5,473
26,011
9,326
271,754
1,404,684
102,901
26,766
806,491
471,921
19,642
1,822,718
Inc.
1,892
4,740
2,609
895
682
6,003
” 744
Dec.
2,742
508
1,565
10,724
6,207
3,019
6,931
10,529
Wholesale Trade
Percentage Increase (or Decrease) in Net Sales During March, 1922
as Compared with February, 1922 and March, 1921
Net Sales (selling price) during March, 1922, compared
with February, 1922......................................................
Net Sales (selling price) during March, 1922, compared
with March, 1921...........................................................
Dry Goods
Groceries
Hardware
13.5
21.2
33.1
— 18.6
— 12.6
__13 .5
Drugs
14.1
— 0.3
THE M O N T H L Y BU SI NESS REVIEW
IS
Department Store Sales
Percentage ot net sales (selling price) during March,
1922, over net sales (selling price) during same month Cleveland Pittsburgh Cincinnati Toledo Other Cities District
last year........................................................................ —15.0 —24.2 — 13.6 — 12.0 — 13.3 —17.8
Percentage of net sales (selling price) from January 1,1922,
to March 31, 1922, over net sales (selling price)
during same period last year.......................................
-15.8
—25.6
— 10.6
— 12.1
— 15.0
— 18.3
Percentage o f stocks at close of March 1922, over
stocks at close of same month last year.....................
8.6
—4.9
11.2
— 2.8
10.4
3.0
Percentage of stocks at close of March, 1922, over
stocks at close of February, 1922...............................
10.7
9.6
10.1
4.5
12.3
9.7
Percentage of average stocks at close of each month this
season (commencing with January 1,1922) to average
monthly net sales during the same period.................
403.6
432.4
534.4
398.3
498.8
441.4
Percentage of all outstanding orders (cost) at close of
March, 1922, to total purchases (cost) during the
calendar year, 1921......................................................
7.5
6.2
11.6
4.9
10.2
7.4
Building Operations For Month of March, 1922-1921
Permit Issued
New Construction Alterations
1922
1921
1922
1921
' Valuations
New Construction
Alterations
1922
1921
1922
1921
436,720
184,215
1,727,660
295,945
2,210,785 1,169,790
3,055,870 4,744,308
1,169,910
589,370
568,132
357,849
191,469
182,065
90,260
100,995
3,250,223 1,357,162
85,970
114,485
714,380
408,990
313,347
125,430
149,305
507,435
52,196
34,560
266.300
422.300
124,590
447,396
57,828
37,805
220,262
9,583
155,600
19,906
26,640
T o t a l..... 2,960 2,795 2,217 3,180 13,702,122 10,399,948
* Figures include Lakewood and East Cleveland
1,874,966
Akron..............
Canton.............
Cincinnati.......
Cleveland*___
Columbus........
Dayton............
Erie.................
Lexington........
Pittsburgh.......
Springfield.......
Toledo.............
Wheeling.........
Youngstown...
139
117
390
514
449
204
127
60
540
72
221
44
83
77
74
281
943
173
110
60
38
153
240
171
373
437
358
206
120
24
308
22
88
217
85
168
209
43
34
98
93
900
1,166
162
116
77
80
118
29
263
37
41
Inc. or
Dec. of
Total
Valuation
Per
Cent
Inc. or
Dec.
95,950 — 296,259 — 55.6
35,522
1,430,753
431.6
482,560
825,735
49.9
476,665 -1,742,803 —33.4
382,540
322,590
33.2
113,417
544,262
115.5
41,360
7,064
3.0
49,000 — 21,930 — 14.6
200,370
1,912,953
122.8
11,320 — 30,252 —24.0
292,800
168,190
24.0
5,394
202,429
154.7
39,915 — 371,405 —67.9
2,226,813
2,950,327
23.4
Movement of Livestock at Principal Centers in Fourth Federal
Reserve District For Month of March, 1922-1921
1922
Columbus.
Fostoria.
Toledo.
Wheeling.
Columbus..
Fostoria...
Pittsburgh.
Springfield.
Toledo___
Wheeling..
Cattle
1921
1922
Hogs
1921
18,865 20,598 103,126 95,735
67,195
10,197
8,000 96,828
3,026 ..............
211
10,404
1,893
1,666
9,455
7,893
5,783
317
553
28,946 24,986 173,703 156,117
3,583
197
2,346
273
8,047
892
9,003
656
278
16,152
9,363
32
5,409
41
491
278
503
2,490
Purchases for
65,092
15,808
71,025
7,378
538
672
54
38,212
6,053
632
849
534
2,490
503
Sheep
1922
1921
1922
Calves
1921
7,808
5,545 17,092 14,470
16,771 21,046 13,267 11,645
238
215
193
95
1,013 *"877
157
716
530
527
74,556 80,042 20,311 19,209
246
130
284
199
441
1,177
736
1,089
1,804
95
90
1,296
1,622
Local Slaughter
63,939
7,323
5,298
9,520
9,290
49,461 11,629 16,363 12,066 11,472
..............
142
79
885
5
6
93 “ “ 32
66,607
6,994 21,270
2,197
7,601
..
7
30
1,699
181
104
562 ’ ‘ 599
1,804
95
90
1,542
1,296
♦ • .
.
.
• « • « « «
........................
• .
. . •
Cars Unloaded
1922
1921
1,634
1,687
6
9
3,584
1,774
1,319
\9
3,189
*
••♦♦•
122
” i28
23
18
(deck.)
• • • ♦ •
• • • * •
• • • • ♦
♦ ♦ ♦ ♦ %
• • • f «
• • • ♦ •
+ • * • •
...................
FOURTH
FEDERAL BESEBVE
D IS T R IC T
@FedFRASER