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M
O
N
T
H
L
Y
R
E
V
I E
W
OF
B U S IN E S S
C O N D IT IO N S
ISAAC B. NEWTON, Chairman of the Board and Federal Reserve Agent
Federal Reserve Bank of San Francisco
Vol. XII
San Francisco, California, December 20,1928
No. 12
SU M M ARY OF N A T IO N A L CONDITIONS
Prepared by the Federal Reserve Board
Industrial activity declined somewhat in No
vember, but continued above the level of a year
ago. Wholesale commodity prices declined fur
ther, reflecting principally a continued decrease
in the prices of farm products. Security loans of
member banks declined sharply after the first
week of December, while other loans increased.
Production. Total output of manufactures
was somewhat lower in November, reflecting
primarily a greater than seasonal decrease in
production of automobiles and steel, but total
output continued larger than a year ago. Pro
duction of pig iron and copper continued to in
crease in November, textile mills remained
active, meat packing increased, while sugar re
fining declined seasonally during the month and
the production of building materials was
smaller. Factory employment and payrolls were
seasonally reduced but were larger than in 1927.
Mineral production was in about the same vol
ume as in October, according to the Federal
Reserve Board’s index, which makes allowance
for seasonal variations. Increases occurred in
the daily average production of copper, zinc, tin
and bituminous coal, while anthracite coal de
creased and the output of petroleum was
smaller. The value of building contracts
awarded in November and the early part of
December receded sharply from the record fig
ures of the two preceding months. The NovemPER
1501
CENT
ber total was slightly larger than in the
corresponding month in 1927, while the volume
of contracts for the first two weeks of Decem
ber was smaller than a year ago.
The December forecast of the Department of
Agriculture increased the estimated 1928 pro
duction of cotton by 240,000 bales to a total of
14,373,000 bales, which is nearly 11 per cent
larger than the 1927 crop. The total value of
crops grown in the United States during 1928,
based on December farm prices, is estimated at
$8,456,052,000 as compared with $8,522,563,000
in 1927.
Trade. Department store sales showed a sea
sonal increase in November, when allowance is
made for the number of business days in that
month, and approximated sales of a year ago.
Inventories continued smaller than in 1927.
Sales at wholesale declined seasonally, but were
larger than in the same month of last year.
Railroad freight shipments decreased in volume
during November and the early part of De
cember, but continued larger than in 1927. The
decrease from October was especially marked
in loadings of miscellaneous freight.
Prices. Wholesale commodity prices de
creased further in November and the first two
weeks of December. The largest price declines
during the six-week period were in farm and
food products and leather, while several groups
R CENT
1
100
1
t
\sm
r y
t
MANUFACT
... .. .
1 0 0\f «
'
■ ....-
1 /B
M IN E R * L S
1925
_ y \
1926
1927
1928 VV 90W
IQ ?
¿L
IQ ? ^
IQPfi
1Q37
iQpo
m
P R O D U C T IO N O F M A N U F A C T U R E S A N D M IN E R A L S
W H O L E S A L E PR IC E S
Index numbers of production of manufactures and minerals, ad
justed for seasonal variations (1923*1925 average —100). Latest
figures, November, manufactures, 111; minerals, 114.
Index of United States Bureau of Labor Statistics (1926 prices =*100,
base adopted by Bureau). Latest figure, November, 96.7.
T h o s e d e s ir in g t h is R e v ie w s e n t t h e m r e g u la r ly w ill r e c e iv e i t w ith o u t c h a r g e u p o n a p p lic a tio n .
90
M O N T H L Y REVIEW OF BUSINESS CONDITIONS
of industrial products, notably iron and steel,
non-ferrous metals, and cotton goods, were gen
erally higher in price. Wholesale prices of gaso
line and automobile tires declined. Among the
agricultural products, prices of raw silk, corn,
livestock, and meats were lower during Novem
ber, while prices of raw cotton, wool, wheat,
and oats increased somewhat. During the first
two weeks of December, however, prices of all
M E R C H A N E > IS E A N D
75
A
/v j
TOTAL
A
K
r
DOLLARS
K4 1 S C E L L A N ! Î 0 U S
¿ ■ 'V
100
offset by a rapid increase in all other loans and
in holdings of investments. The increase in all
other loans, which include loans for commercial
purposes, was contrary to the usual movement
at this season and carried the total to the high
est figure in eight years. Seasonal growth in the
demand for currency in November and Decem
ber, together with increases in member bank
reserve requirements consequent upon an inB IL L IO N S O F
PER CEN T
125
D e ce m b e r, 1928
V Y v C
\ *
A
\
/ '
^ ~----- 1
R A IL R O A D F R E IG H T C A R L O A D IN G S
Cars of revenue freight loaded as reported by the American Railway
Association. Index numbers adjusted for seasonal variations,
(1923-1925 average = 100). Latest figures, November,
total 103, miscellaneous, 106.
these products with the exception of raw silk
declined. Prices of building materials were gen
erally higher in November, but declined some
what toward the middle of December.
Bank Credit. Loans and investments of mem
ber banks in leading cities increased $329,000,000 during the four-week period ending
December 19. The advance during the first two
weeks reflected chiefly a rapid increase in secu
rity loans, which include loans to brokers and
dealers in securities. Subsequently, a sharp
decline in loans on securities was more than
R ESE R VE B A N K C R E D IT
Monthly averages of daily figures for 12 Federal Reserve Banks.
Latest figures are averages for first 21 days in
December.
crease in their deposits, have been reflected in
larger borrowings by the member banks from
the reserve banks. This recent growth, follow
ing upon the demand caused by the export of
gold in earlier months, has carried the total
volume of reserve bank credit in use to the
highest level in seven years. The rates on call
and time loans on security collateral increased
during the last week in November and the first
part of December, while rates for commercial
paper were generally steady. Rates on certain
maturities of bankers' bills increased slightly.
T W E L F T H FE D ER AL RESERVE DISTRICT CON DITIONS
Economic conditions in the Twelfth Federal
Reserve District during the closing months of
1928 have reflected those developments which
characterized the year as a whole. Industry has
been active and during the second half of the
year labor has been more fully employed than
a year ago. Sales of goods at wholesale and at
retail have been large both in volume and value.
Agricultural output has increased but prices of
agricultural products have tended downward
during the marketing season. Prices of nonagricultural commodities have averaged above
the prices of last year. A substantial amount
of credit has been available at but slightly
higher interest rates than prevailed during
1927.
Crop estimates made December 1 indicate
that, in the aggregate, production of field,
grain, and fruit crops during 1928 was larger
than during 1927. During the current market
ing season, and particularly toward its close,
prices paid for these crops have not compared
favorably with prices paid in 1927. It appears
probable that total returns to the District’s
farmers will not exceed those of last year. Live
stock producers have been moderately heavy
sellers of cattle, and heavy sellers of sheep at
prices which have averaged higher than a year
ago.
Industrial output in the District experienced
a seasonal decline during November, but em
ployment of other than unskilled labor con
tinued at levels higher than a year ago. Trade
at retail declined moderately during the month,
but total sales both at retail and at wholesale
were larger during the first eleven months of
1928 than during the same period of 1927.
Prices generally tended upward during the
second and third quarters of 1928, but declined
during the fourth quarter, and toward the
year’s close the Bureau of Labor Statistics’ In
dex of wholesale commodity prices receded to
levels approximating those of November, 1927.
The decline in recent months has been a reflec
D e ce m b e r, 1928
91
FEDERAL RESERVE AG EN T A T SAN FRANCISCO
tion chiefly of lower prices for agricultural
products, prices of certain non-agricultural
commodities important in this District, notably
copper, lumber, and petroleum, now being
higher than a year ago.
Reduced demand for credit at the Federal
Reserve Bank of San Francisco, and increased
loans and investments by member banks char
acterized the credit situation in the Twelfth
Federal Reserve District during late November
and early December. The amount of Reserve
Bank and member bank credit in use during this
period, however, was considerably greater than
a year ago.
Agriculture
The United States Department of Agricul
ture’s most recent (December 1) estimates of
production and value of field, grain and fruit
crops grown in the District show that the 1928
harvest was greater in volume but had a
slightly smaller value than the 1927 harvest.
Weather conditions during the year favored
the growth and harvesting of large crops,
although yields of some of the important field
crops— hay, rice, sugar beets, and beans— were
smaller than a year ago. The general level of
prices paid farmers for their crops during active
marketing periods was lower in 1928 than in
1927, price declines being greatest in the case
of those crops— deciduous fruit and grains—
which were produced in largest quantities.
These declines in prices of agricultural prod
ucts were accompanied by slight advances in
prices of many of the commodities purchased
by farmers, indicating that farmers of the Dis
trict generally experienced some decrease in
purchasing power during the year.
The 1928 wheat crop of the Pacific Northwest
continues to move to market at the slow pace
which often characterizes periods of declining
grain prices. On December 8, receipts of wheat
at the grain terminals in Seattle and Tacoma,
Washington, and in Astoria and Portland, Ore
gon, had totaled 27,715 carloads for the current
crop season as compared with receipts of
38,548 carloads during the same period a year
ago. Exports of wheat from these and other
Puget Sound and Columbia River ports totaled
15.446.000 bushels for the 1928 season to De
cember 1 as compared with 35,052,000 bushels
during the same period last year.
The 1928 deciduous fruit year ended during
November and early December, with the prac
tical completion of grape picking and shipping
in California. This year’s abundant grape crop
matured early and a prolonged period of dry
weather during the picking season aided the
successful harvesting of the fruit. The size of
the crop and its early maturity developed a
serious marketing problem for growers and
shippers and the season was characterized by
the relatively low prices which were received
for nearly all varieties of grapes. Shipments of
California grapes totaled 70,587 carloads be
tween June 15 and December 8,1928, compared
with total shipments of 75,383 carloads during
the same period in 1927. The total tonnage
shipped during the current season was prob
ably larger than one year ago, however, as the
minimum carload requirement was raised from
26.000 to 30,000 pounds this year. It is esti
mated that 258,000 tons of raisins were pro
duced in California during 1928. The 1927
crop was estimated to be 285,000 tons.
Harvesting of the late crop of apples has
been completed in the Pacific Northwest but
heavy shipments continued during the early
part of December. On December 1, there were
15,106 carloads of apples in cold and common
storage in the Wenatchee, Yakima, and Spo
kane Valleys in Washington, as compared with
(A) Production and Value o f Farm Crops—
t ------------------------------------------P r o d u c tio n * ------------------------------------------\ t----------------------------------t ----------Tw<ïlfth
Unit
bu.
. bu.
.b u .
bu.
bu.
bu.
. bales
H ay (tam e) . . . . . tons
H o p s .................... . lbs.
P otatoes (w hite) . bu.
R i c e ...................... . bu.
Sugar Beets . . . . . tons
A p p l e s .................. . bu.
. tons
Grapes .................. . tons
P eaches ............... . bu.
P e a r s .................... . bu.
Plum s .................. . tons
Prunes ................. . tons
Oranges ............. . boxes
L e m o n s ................. . boxes
A lm onds ................ tons
W alnuts ............. .. tons
B a r l e y ..................
C o r n ......................
Grain S org h u m ..
O a t s ......................
W h e a t ..................
Beans (d ry ) . . . .
1928
46,413
11,164
6,325t
35,260
125,746
5,901$
289|
14,568
32,742%
47,107
8,073°
1,5 4 1#
58,740
171°
2,3310H
25,752°
15,326§
66°
193°
31,000°
7,100°
13°
25°
DistriiA
-y
1923-1927
1927
Average
41,147
12,058
5,606t
34,095
138,822
6,531$
1821
15,312
30,658§
56,076
8,960°
1 ,5 3 4 #
43,861
208
2,406° 11
20,500°
14,719§
57°
203°
23,000°
6,000°
12°
51°
f--------------
1928
1United Stateis-------------- \ r~------ Twelfth IDistrict
1923-1927
1927
Average
1928
1927
265,882
209,321
40,443
356,868
11,610 2,839,959 2,763,093 2,747,040
99,877
137,358
4,4131 142,533
33,286 1,449,531 1,182,594 1,345,081
793,713
101,465
878,374
902,749
16,181
16,941
16,598
5,811$
14,160
14,373
12,955
199t
106,001
93,017
14,535
93,031
26,542§
26,714§
30,658§
32,742§
383,526
40,706
462,943
402,741
44,774
36,118
6,356°
41,881
7,040
7,753
7,458
1 ,6 3 6 #
49,721
184,920
123,693
183,434
177°
l,099°fl
2,6051[
2.636H
2,Í9Ílf
68,374
45,463
52,224
17,808°
10,947§
18,373
20,210
23,783
57°
153°
23,530°
31,2000
43,0000
35,2930
6,415°
10°
29°
$32,922
11,432
4,672f
18,376
126,913
22,128$
180,538:
6,319 §
25,235
7,104°
47,222
8,550°
12,559°
14,588§
2,442°
19,300°
102,300°
22,720°
4,658°
10,500°
V a lu e *
t--------United
1928
$35,295
$197,128
2,132,991
10,577
88,471
5,096t
18,780
592,674
148,953
877,193
17,293$
66,639
1,291,589
21,7741*
148,193
1,148,283
6,808§
6,319§
36,948
250,043
10,304°
30,077
7 ,0 4 9 #
50,525
51,887
185,126
11,856°
56,600°
49,041
10,675°
63,649
11,112 §
24,246
2,565°
14,210°
92,000°
130,5000
22,800°
3,840°
16,830°
States--------\
1927
$180,200
1,997,759
84,614
531,762
979,813
46,612
1,269,885
1,202,953
6,808§
388,741
41,616
59,455
171,394
65,332
50,494
24,298
124,8000
*In thousands. fA rizon a and California. {C alifornia and Idaho. §California, O regon ? and W ashington. °California. #C a liforn ia ,
Idaho, and Utah, ftln California, 142,000 tons were not harvested in 1927, and 153,000 tons not harvested in 1928. OCalifornia and
Florida.
D ecem b er, 1928
M O N T H L Y REVIEW OF BUSINESS CONDITIONS
92
11,500 carloads held in storage in this area a
year ago. Exports of apples from the United
States during the 1928 crop season to Novem
ber 24 totaled 1,854,347 barrels and 5,337,665
boxes. During the corresponding period in
1927, exports amounted to 1,257,556 barrels and
2,617,492 boxes. Current f.o.b. shipping point
(Pacific Northwest) prices for apples range
from 75 cents to one dollar per box lower than
in 1927.
A P P L E S — Carlot Shipments
(— November—
C alifornia ........................................
Id a h o .................................................
O regon ..............................................
W ashington .....................................
1928
272
887
1,072
6,512
T otal ...................................................
8,743
U nited States ................................. 13,388
1927
436
1,814
848
6,181
9,279
15,877
/^-July 1 - D ec. 1—\
1928
5,298
5,150
4,406
25,864
1927
3,303
6,520
2,472
19,106
40,718
90,182
31,401
69,519
During November shipments of oranges
from California totaled 4,481 carloads. During
November a year ago, 1,277 carloads were
shipped. Current estimates of the 1928-1929
crop of Navel oranges place the yield at ap
proximately 16,500,000 boxes, a figure which
may be compared with the 11,650,000 boxes
harvested during the 1927-1928 season. Average
prices, f.o.b. shipping point, for California
oranges declined during November to levels
below those of either one month or one year
ago.
Livestock on the District’s ranges are gen
erally in good condition, although the quality
and quantity of range forage has declined dur
ing recent months, making necessary the early
use of supplemental feed supplies.
The accompanying record of livestock re
ceipts at eight principal markets of the District
reflects recent trends of livestock production,
the growing receipts of sheep and the declining
receipts of cattle following upon readjustments
in the cattle and sheep industries which took
place a few years ago. These data and the
weighted average prices, which are also shown,
indicate with some accuracy the relative
amounts of cash income received by livestock
producers of the District during the past two
years. Market prices for cattle and sheep dur
ing 1928 have been at higher levels than during
1927, and stockmen have realized cash returns
equal to or better than last year.
L I V E S T O C K R E C E IP T S A N D P R IC E S
Twelfth District
t --------------- January 1 - December 1--------------t---------Receipts*---------- t--------------Pricesf--------
1928
808,398
174,298
Cattle .................................
Calves ...............................
H o g s ................................... 2,286,689
Sheep ................................. 3,641,083
1927
932,112
225,572
1,913,447
3,320,867
1928
1927
$11.83 $ 9.07
........................
10.38
11.97
13.44
12.51
*E ight principal m arkets. jP e r hundredweight.
P rices w eighted a ccord in g to seasonal receipts and volum e re
ceived at each market.
Seasonal rainfall in the Twelfth District dur
ing September and October was less than
normal, and fall plowing and grain sowing
operations were hindered by the resultant lack
of moisture in the soil. Heavy rains during
recent weeks have added to seasonal totals,
however, until they approximate normal in all
parts of the District, except the Pacific North
west.
Industry
Activity in a number of important indus
tries in the Twelfth Federal Reserve District
showed a seasonal decline during November,
but a generally high level of production was
maintained. A reflection of the sustained pace
of industry during November is found in the
month’s figures of unemployment and of rail
road carloadings. The total number of unem
ployed persons in the District at the opening of
the winter season was reported to be smaller
than a year ago. This Bank’s seasonally ad
justed index of freight carloadings of industrial
commodities stood at 110 (1923-1925 daily average=100) in November, 1928; 109 in October,
1928; and 108 in November, 1927. Urban build
ing provided an exception to this general
situation.
A smaller than seasonal reduction in employ
ment was reported during November from all
states of the District except Oregon and Cali
fornia. Increased mining activity and a fairly
active engineering construction program were
largely responsible for the maintenance of em
ployment schedules. In California and Oregon,
the reduced demand for labor incident to the
close of the agricultural season and the usual
winter influx of workers tended to raise the
number of unemployed. A slight shortage of
skilled miners was reported from most of the
mining sections of the District.
Lumber production was curtailed rather
sharply during November, particularly in Ari
zona, Northern California, and Oregon. De
spite curtailment, the cut of lumber for the
District as a whole was substantially larger
than the volume of orders received or of ship
ments made. This Bank’s seasonally adjusted
index of lumber production dropped to 107
(1923-1925 daily average=100) in November,
1928, from 111 in October, 1928. In November,
1927, it stood at 106.
As reported by S. W . Straus and Company,
(B) Industry—
Indexes of daily average production, adjusted for seasonal variation
(1923-1925 daily average = 100)
-1 9 2 8 t ----M anufactures:
N ov.
Oct.
* 1927
Sept.
N ov.
101
109
90
108
Slaughter o f L iv e s to ck ....................
85
92
84
99
, 107*
104
106
1110
R efined M ineral O ils t .................... . 161
162
150
159
110
103
. 118
120
W o o l C onsum ption ........................
88
73
81
Minerals :
.
101
P etroleum (C a lifo rn ia )t .............
95
96
94
C opper (U nited States) $ ........... .. 133
128
121
106
109
116
L ead (U nited States) $ ............... .. 114
110
Silver (U nited States) $ ............... , 91
81
79
100
G eneral:
Carloadings§ .................................... .. 110
109
109
108
*Preliminary. fN ot adjusted for seasonal variations. JPrepared
by^ Federal Reserve Board. §Other than Merchandise and
Miscellaneous. ^Revised.
D e ce m b e r, 1928
federal
reserve
agent
the value of building permits issued in the Dis
trict declined sharply during November, bring
ing the cumulated total for the year 13 per cent
below the total for the January 1-November 30
period in 1927. In October, the cumulative
figures were 11 per cent below those of last
year. The major part of the decline over the
year period may be accounted for in the permit
figures of four of the larger cities of the Dis
trict— Los Angeles, San Francisco, Portland,
and Seattle. The value of engineering and
heavy construction contracts awarded during
November, as published for the far-western
district by the Engineering News Record,
showed a substantial increase over November
a year ago. The cumulative totals for the year
to date, however, were 11 per cent below those
for the same period in 1927.
Production of petroleum rose sharply during
November, due chiefly to increased yield from
the new deep well zone of the Santa Fe Springs
field in Southern California. Metal mining was
active throughout the District during Novem
ber with copper production reaching new
record levels. Stimulation of copper produc
tion, afforded by rising prices for that metal,
has noticeably increased the production of
other non-ferrous metals, frequently found asso
ciated with copper. High prices and an in
creased demand have also induced a larger
production of quicksilver.
Milling of flour in the District continued in
large volume during November. Stocks of flour
and of millers’ wheat declined somewhat dur
ing the month. Reports indicate that domestic
demand for flour was fairly active during No
vember, and that foreign demand was rela
tively quite.
Trade
Trade in the Twelfth District was more
active during November, 1928, than during
November, 1927, and, if allowance be made for
the usual seasonal changes, approximated that
of October, 1928. The value of department
store sales, particularly in Los Angeles and
( C) Distribution and Trade—
N ov.
Carloadings, T o ta lf ......................
Carloadings, M erchandise and
M iscellaneou sf ............................
Sales at W holesale? ......................
Sales at R eta il! ............................
S tocks, Retail§ .................................
Sales of N ew Automobiles||
P assenger Cars ..........................
C om m ercial V ehicles ...............
116
112
114
110
120
106
116
110
115
107
120
110
118
99
123
109
112
105
118
113
117
113
112
126
110
119
73
90
.24
46.2
14.7
.26
48.3
17.3
.25
San Francisco, was smaller than during Oc
tober, 1928, or November, 1927, but sales at
wholesale, sales of new automobiles, and
merchandise and miscellaneous freight carloadings were at higher levels than one year
ago.
This Bank’s seasonally adjusted index of
merchandise and miscellaneous freight carload
ings stood at 120 (1923-1925 daily average=
100) in November, 1928; 115 in October, 1928,
and 112 in November, 1927. Total carloadings
were heavy throughout the District during
November, nearly all commodities being han
dled in larger volume than during November a
year ago. This Bank’s seasonally adjusted
index of total carloadings advanced to 116
(1923-1925 daily average=100) in November,
1928, as compared with 112 in October, 1928,
and 110 in November, 1927.
Total value of sales at retail of 144 depart
ment, apparel, and furniture stores was 1.3 per
cent smaller in November, 1928, than in No
vember, 1927. The principal declines were re
ported from Los Angeles, San Francisco, and
other northern California cities, excepting Oak
land. The seasonally adjusted index of sales
of 28 department stores declined to 116 in No
vember, 1928, as compared with 120 in October,
1928, and 118 in November, 1927.
R E T A I L T R A D E — Twelfth District
,--------- N E T S A L E S *--------- N
Jan. 1 to
N ov., 1928,
N o v .30,1928,
compared
compared with
with
Jan. 1 to
N ov., 1927
N o v .30,1927
Departm ent S t ö r e s t ... — 1.8 ( 65)
2.4 ( 60)
Apparel Stores .............
3.6 ( 29)
1.9 ( 23)
Furniture S t o r e s ......... — 0.2 ( 50)
— 2.1 ( 42)
A ll Stores ......................— 1.3 (144)
1.7 (125)
*P ercentage increase or decrease (— ) . Figures in
indicate num ber of stores reporting, fln clu d e s
stores.
45.3
15.8
— 2.3 (49)
1.8 (17)
— 8.2 (33)
— 2.8 (99)
parentheses
dry good s
(D) Employment—
-Californ ia--------- \ t------- —
N o. of
N o. r ~ Employees —>
N o.
N ov.,
of
N ov.,
of
Industries
Firms 1928
1927 Firms
A ll Industries........... 741 151,452 143,187
148
(5.8)
Stone, Clay and
✓
F oods, Beverages
and T o b a cco . .
W ater, L ight
and Pow er
45.9
15.8
ST O C K *
N ov., 1928,
compared
with
N o v ., 1927
Sales at wholesale, while not so great in value
during November as during October, were of
46
...
Oregon1
N o. of
•— Employees —\
N ov.,
N ov.,
1928
1927
26,554
25,621
(3.6)
6,883
(— 2.2)
7,039
4
136
(5.4)
129
25,238
(— 4.9)
18
2,511
(— 4.9)
26,525
56
15,158
2,639
10
16,193
(6.8)
1,858
(— 4.3)
7,463
(— 1.1)
7,546
455
(3.4)
440
159
26,106
(4.9)
24,886
2,830
(— 0.9)
2,856
5
7,723
(— 6.4)
8,250
Clothing, M illinery
and Laundering 61
.24
93
f r a n c is c o
Lum ber and W o o d
M anufactures . . 113
*A djusted for seasonal variations, 1923-1925 avera g e= 1 0 0 . fD a ily
average. {M on th ly totals of eleven lines com bined §A t end
of m onth UFor source of figures, see June, 1928, Review.
ifProportion of average stocks sold during m onth. # P e r cent
of collections during m onth to amount outstanding at first o f
m onth.
san
Glass P rod u cts.
— 1928-------------- * 1927
Oct.
Sept.
Nov.
Index N um bers*- ...
Actual Figures
S tock Turnover, Retail!! .............
C ollections, R e ta il#
R e g u l a r ............................................
Installm ent ...................................
at
Other Industriesf 325
8*
40
1,942
73,426 64,036
(14.7)
2,102
M iscellaneous . . .
14
2,266
30
5,082
5,096
(— 7.2)
(— 0.3)
* Laundering only. fln clu d e s the follow in g industries :: Metals.
m achinery and co n v e y a n ce s ; leather and rubber g o o d s ;
chemicals, oils and p a in ts; printing and paper goods.
Figures in parentheses indicate percentage changes from N o
vem ber, 1927.
94
M O N T H L Y REVIEW OF BUSINESS CONDITIONS
greater value than during November, 1927. The
seasonally adjusted index of sales at wholesale
as computed by this Bank stood at 106 (19231925 monthly average==100) in November,
1928; 107 in October, 1928, and 105 in Novem
ber, 1927. Wholesalers’ stocks were 3 per cent
smaller at the end of November, 1928, than at
the end of November, 1927.
Sales of new automobiles remained at high
levels for this season of the year. The season
ally adjusted index of sales of new passenger
cars stood at 117 (1923-1925 daily average=
100) in November, 1928; 112 in October, 1928;
IN D E X
NUMBERS
130
A
12 0
—
HO
A
AA
RETAI L ,
; V :
100
^
v
V/H O L E S A L E
SALE S
la oc;
p e
V
u
90 Vv----f' /--CAR
80 __ LOADING ; s
1
W IQOA
A sô \ ,
A
109 A
r
J
f *
A K h f ..
\ r ^ J \ W \T
1097
IQ? A
W
D IS T R I B U T I O N A N D T R A D E - T W E L F T H D IS T R I C T
Indexes adjusted for seasonal variation. 1923-1925 average = 100. Daily
average figures of department store sales and railway carloadings
of merchandise freight. Monthly figures of sales at wholesale.
and 73 in November, 1927, while the index of
new truck sales stood at 113 (1923-1925 daily
average=100) in November, 1928, as compared
with 126 in October, 1928, and 90 in Novem
ber, 1927.
Prices
The general level of commodity prices has
fluctuated within a range of 5 per cent during
1928 and it was approximately the same in the
last month of the year as in the first. There
was little change in average monthly indexes
during the first quarter of the year, but during
the second and third quarters an upward trend
was in evidence. This movement culminated in
September, after carrying the indexes to the
highest point reached since June, 1926. Dur
ing the past three months sharp declines in
prices of commodities of leading importance
have brought composite indexes to approxi
mately the levels at which they stood at the
beginning of the year.
Composite indexes are not reliable indicators
of actual changes in prices of specific commod
ities and the moderate movements in such gen
eral indexes during the past year do not reflect
the wide variations that have taken place in
quotations of many individual products. It is
desirable, therefore, to call attention not only
to the relative stability in the general price
level during 1928, but also to the considerable
fluctuation in prices of many important com
modities— fluctuations which have tended more
or less to offset one another. For example-
D e ce m b e r, 1928
prices for cotton, corn, and cattle have moved
within a range of 25 per cent, quotations for
lambs and hogs have fluctuated by as much as
30 per cent, and wheat prices have had a spread
of 35 per cent between the high and low points
for the year. Crude petroleum prices have been
advanced substantially, some grades as much
as 45 per cent, and quotations for copper have
advanced 15 per cent since January. Crude
rubber prices declined 50 per cent early in the
year and have remained at about the levels
reached at that time.
Prices of commodities important in the
Twelfth District have not been free from these
movements and the year’s returns to various
economic groups, such as mining operators and
agriculturists, have been increased or decreased
to some extent in accordance with price
changes. Advances in copper prices through
out the year have resulted in improved condi
tions in that industry. Crude oil producers have
benefitted from upward revisions in petroleum
prices. Increases in softwood lumber prices
have been moderate and, with at least a par
tial control of output in effect, have helped to
improve the position of that industry. In agri
culture, advancing prices for some crops have
increased the incomes of certain producers,
while other groups of producers have received
smaller aggregate returns than were antici
pated early in the year, even though crops were
of record or near-record size. Among those pro
ducers who have, in general, been favored by
price changes are orange, lemon, and prune
growers. Groups wrhose aggregate income was
adversely affected by changing prices during
the year include grape, potato, and wheat grow
ers. A combination of changes in prices and
production has resulted in generally satisfac
tory total income returns to other groups such
as those producing apples, barley, or cotton.
Banking and Credit
There has been little change in the credit
situation in the Twelfth Federal Reserve Dis
trict since October, 1928. Demand for member
bank and Reserve Bank credit has continued
larger than a year ago and the supply of credit
has continued ample for the District’s needs.
Reporting member bank loans and investments
were further expanded during November and
early December, while at the same time their
borrowings from the Federal Reserve Bank of
San Francisco were reduced. Prevailing inter
est rates charged by banks in principal finan
cial centers of the District remained slightly
above the rates quoted a year ago.
Commercial loans of reporting member banks
averaged higher during November than in Oc
tober and rose to record levels (997 million
dollars on December 12) during the first half
of December. Loans on securities at these
D ecem b er, 1928
banks also increased during November and the
first week of December. These loans showed
a slight reduction during the second week of
. December, as security prices and activity in
security markets declined. Investment hold
ings of reporting banks were reduced during
November, but during the first half of Decem
ber they rose to October levels. Both demand
and time deposits at the banks showed an up
ward trend throughout November and the first
half of December. The increase was not so
great as that in loans and investments, how
ever, and the member bank ratio of total de
posits to total loans and investments ranged
slightly lower during late November and early
December than a month earlier.
R E P O R T IN G M E M B E R B A N K S * — Twelfth District
(In millions of dollars)
t------------------------ Condition-------------------------»
D ec.12, N ov.28, N o v .14, O ct.31, D e c .14,
1928
1928
1928
1927
1928
T otal Loans and Investm ents 2,082
T otal Loans ............................... 1,412
997
Com m ercial Loans .................
415
Loans on S e c u r it ie s ...............
Investm ents ......................
671
N et Dem and D e p o s its .............
869
T im e D eposits .......................... 1,038
B orrow in gs from Federal
R eserve Bank ......................
50
2,056
1,401
983
419
654
863
1,013
2,044
1,389
987
401
655
882
1,017
2,030
1,364
973
390
667
840
1,016
1,889
1,302
951
352
586
849
942
67
61
64
39
*Total resources of reporting banks are approxim ately 46 per cent
of total resources of all banks and 62 per cent of total
resources of all m em ber banks in the Twelfth Federal R e
serve D istrict. R eporting banks em brace m em ber banks and
branches located only in L os A ngeles, San Francisco, O ak
land, Portland, T acom a, Seattle, Spokane, Salt Lake City,
and O gden.
During the first half of November borrow
ings from the Federal Reserve Bank of San
Francisco were reduced, a net inflow of funds
into the District and large treasury disburse
ments being but partially offset by an increased
demand for currency and increased reserve re
quirements of the member banks. During the
second half of November borrowings from the
Reserve bank increased sharply, due to a heavy
(E ) Bank Debits* —
N ov.,
N ov.,
1928
1927
B a k e rs fie ld ........ $
16,437 $
15,631
Bellingham . ..
9,765
9,238
22,049
23,237
B erkeley ...........
16,109
B oise ................
16,238
Eugene ...............
8,512
7,929
E v e r e t t .............
12,495
13,576
Fresno ...............
40,680
55,166
L o n g Beach . . ,
58,324
43,595
959,827
L os A ngeles . . . 1,122,458
219,940
O a k la n d .............
223,368
O g d e n ...............
23,220
25,281
Pasadena ...........
38,657
37,321
P hoenix .............
43,006
32,258
189,656
P o r t l a n d ...........
210,361 f
R eno ....................
11,265
9,203
1,167
1,263
Ritzville .............
Sacram ento
51,023
48,346
75,477
78,740
Salt Lake C ity . .
San Bernardino
10,987
11,424
59,574
San D iego .........
62,460
.
1,476,300
1,323,671
San Francisco . 44,191
27,174
San Jose
13,341
Santa B a rb a ra ..
15,083
223,036
Seattle .............
224,486
55,959
58,116
Spokane .............
28,209
27,076
S tockton ...........
46,371
42,949
T acom a .............
17,957
17,479
Yakim a .............
D istrict
95
FEDERAL RESERVE AG EN T A T SAN FRANCISCO
......... $3,964,406f $3,592,255
<—
$
First Eleven Months —>
1928
1927
146,171
157,032 $
106,739
110,435
240,295
237,937
169,752
152,763
82,691
84,333
149,867
139,727
449,581
391,988
526,760
608,936
10,162,7 3^11,742,149
2,681,191
2,422,441
203,738
209,990
441,393
438,717
299,308
386,226
2,000,534$
1,874,764
110,758
103.412
11,570
10,787
426,762
551,574
827,333
766,063
117,860^
112,761
683,345
674,914
13,552,389
16,704,667
329,746
289,973
155,993
148,249
2,690,528
2,374,367
623,286
610,789
320,710
308,256
506,832
492,986
156,842
143,838
$43,165,165$ $37,259,617
*In thousands, tln clu d es $18,026,000 at four banks not reporting
prior to week ended M ay 2, 1928. {In clu d es $121,979,000 at
four banks not reporting prior to week ended M ay 2, 1928.
^Revised, cumulative figure Sept. $95,668; O ctober $106,87,3.
outflow of funds from the District, which was
not altogether offset by (a) Treasury disbusements in excess of receipts, (b) a reduced Dis
trict demand for currency and (c) reduced re
serve balances of member banks. Average total
borrowings from the Reserve bank were lower
during November than during October, but this
decrease, insofar as the total amount of reserve
bank credit outstanding is concerned, was bal
anced by slightly larger average holdings of
purchased acceptances and United States Secu
rities. During the first half of December there
was a renewed inflow of funds into the District,
which coupled with further net Treasury dis
bursements and a further reduction in member
bank reserve balances overcame the influence
of a seasonal expansion in the District’s cur
rency needs and resulted in a sharp reduction
in demand for credit at the Reserve bank. Coun
try banks reduced their borrowings one million
dollars or 15 per cent, and city banks 17 million
dollars or 25 per cent.
MILLIONS OF DOLLARS
300
200
100
1924
1925
1926
1927
1928
R E S E R V E B A N K C R E D I T -T W E L F T H D IS T R IC T
Monthly average of daily figures. Latest figures are averages for
first 21 days in December.
Those factors responsible for changes in the
demand for credit at the Reserve bank also ac
counted for the increase in this Bank’s cash
reserves during the first half of November, their
sharp decline during the second half of that
month and their sharp increase during the first
half of December. During this six weeks period,
November 1 to December 12, inclusive, there
was a relatively constant transfer of funds into
the District by the United States Treasurer to
cover his disbursements in this area, a factor
tending to increase this Bank’s reserves, which,
at the end of the period, were higher than at
its beginning.
F E D E R A L R E S E R V E B A N K O F S A N F R A N C IS C O
(In millions of dollars)
t------------------------
Condition------------------------->
Dec. 12, N ov.28, N ov.14, Oct.31, D ec.14,
1928
1928
1928
1928
1927
T otal Bills and S ecu ritie s..
Bills D is c o u n t e d ....................
Bills B ought ..........................
United States S e c u r it ie s ....
T otal R e s e r v e s ........................
Total D e p o s i t s ........................
Federal Reserve N otes in
Circulation ..........................
R eserve R atio ........................
124
55
52
17
259
194
141
73
50
17
240
195
125
66
42
17
262
200
127
70
40
17
251
192
97
45
6
46
282
191
169
71.5
164
66.7
167
71.3
164
70.6
172
77.7
96
December, 1928
M O N T H L Y REVIEW OF BUSINESS CONDITIONS
E a r n i n g s
a n d
E x p e n s e s
o f
M e m b e r
B a n k s
in
T w e l f t h
District
Analysis o f Costs and Earnings o f Non-Branch Operating Banks During 1927
(Statem ent o f amounts per $100 o f earning assets in even dollars and cents results in som e instances in slight discrepancies betw een
com ponent figures and related totals.)
Number of Banks............................. ..........
Average Amount of Earning Assets
$1,000,000
$2,000,000
$3,000,000
to
to
to
1,999,999
2,999,999
3,999,999
$1,000,000
and
Under
Twelfth
District*
$4,000,000
to
4,999,999
$5,000,000
and
Over
620
418
100
35
21
14
32
Amount per $100 of Earning Assetsf
Total Earnings ............................. .........
$6.77
Interest Earned .......................... ..........
5.90
Other Earnings ........................... ...................88
$7.67
6.80
.87
$7.37
6.52
.85
$7.42
6.25
1.17
$6.55
5.82
.73
$6.17
5.74
.42
$6.38
5.39
.99
5.00
1.65
.08
2.03
1.24
5.80
2.16
.12
1.96
1.57
5.49
1.97
.08
1.98
1.46
5.61
1.88
.08
2.04
1.61
4.85
1.68
.03
2.11
1.02
4.40
1.38
.05
1.92
1.05
4.67
1.41
.09
2.08
1.09
Net Earnings................................
Net Losses....................................
Net Addition to Profits...............
Dividends Declared......................
........
1.77
.................. 82
.................. 95
.................. 73
1.86
1.12
.74
.72
1.88
1.03
.85
.78
1.81
.89
.92
.81
1.70
.84
.86
.67
1.77
.43
1.34
.81
1.71
.73
.98
.70
Amount per $100 of Earnings
Interest Earned ...........................
Other Earnings ...........................
87.05
12.95
88.70
11.30
88.48
11.52
84.19
15.81
88.88
11.12
93.04
6.96
84.47
15.53
Total Expenses .............................
Salaries and Wages ................... .........
Interest and Discount on Borrowed Money
Interest on Deposits ................... ..........
All Other Expenses ........ ............ .........
73.85
24.41
1.24
29.93
18.27
75.70
28.18
1.53
25.52
20.48
74.45
26.75
1.03
26.86
19.81
75.57
25.29
1.04
27.54
21.70
74.00
25.62
.50
32.28
15.60
. 71.36
22.52
.82
31.05
16.96
73.13
22.05
1.46
32.55
17.07
Net Earnings................................
Net Losses....................................
Net Addition to Profits...............
Dividends Declared......................
26.15
12.13
14.02
10.79
24.30
14.62
9.68
9.40
25.55
14.03
11.52
10.59
24.43
12.00
12.43
10.91
26.00
12.80
13.20
10.18
28.64
7.16
21.48
12.97
26.87
11.55
15.32
11.03
$693.63
6.40
1.96
44.38
45.48
9.17
45.34
$806.22
6.97
2.07
50.32
61.81
14.61
23.58
$611.43
8.11
2.09
31.60
75.97
4.96
19.07
$813.24
7.95
2.33
35.27
58.43
15.48
26.09
7.91
8.80
9.37
13.74
11.59
11.05
39.54
44.36
41.17
Total Expenses ............................. ..........
Salaries and Wages ..............................
Interest and Discount on Borrowed Money
Interest on Deposits ..............................
All Other Expenses ..............................
O
t h
e r
O
p e r a
t i n
g
R
a
t i o s
(Amount per $100)
Earning Assets to Invested Capital
......... $724.84
Profits to Invested Capital.................. ..........
6.88
Interest on Deposits to Gross Deposits. ..........
2.11
Time Deposits to Gross Deposits........ .........
38.54
Losses on Loans to Total Losses........ ..........
59.60
Losses on Securities to Total Losses, , ..........
12.30
Other Losses to Total Losses............. ..........
28.10
M
i s c e l l a n
e o u
s
$628.94
4.67
1.86
38.91
65.79
6.74
27.48
C
o m
p a
$684.37
5.81
1.90
42.57
53.24
14.58
32.18
r a
t i v e
I t e m
s
(Per Gent of District Total)
Invested Capital ..........................................
Earning Assets ................................ ..........
Gross Deposits ................................ ..........
100.0
100.0
100.0
19.42
16.85
18.46
12.41
11.72
12.70
6.98
6.68
7.25
*Inclu des figures for A rizon a and Nevada which are not shown separately because o f small numbers of banks included.
tE a m in g assets include loans and discounts and holdings o f G overnm ent securities and other bonds, stocks and securities.
These ratios are based upon data taken from the custom ary abstracts of reports of conditions and of earnings, expenses, and dividends.
It should be borne in m ind in using them that the statistics em ployed represent aggregates for all m em ber banks reporting on the
various dates, and such ratios as are shown in this table are therefore ratios of aggregates in which figures fo r large banks have
a statistical influence som ew hat disproportionate to their num ber in com parison with the figures for small banks. Data are only
for m em ber banks for which com plete condition reports fo r every call in a particular year were available. W here reports fo r any
bank were not com plete during any year all figures for that bank were om itted.
NOTE: The character of the work and the large amount of data involved in preparing these operating ratios
have resulted in occasional clerical errors. It is, therefore, necessary to regard the figures now being published
as preliminary data, subject to some revision. Complete and final figures, including those for 1928, will probably
be published during 1929.
@FedFRASER