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MONTHLY REVIEW
OF
BUSINESS CONDITIONS
ISAAC B. NEWTON, Chairman of the Board and Federal Reserve Agent
Federal Reserve Bank of San Francisco
Voi. X III
San Francisco, California, December 20,1929
No. 12
SUMMARY OF N ATION AL CONDITIONS
Prepared by the Federal Reserve Board
Industrial production declined in November
for the fifth consecutive month and was below
the level of last year. Retail sales at department
stores continued in larger volume than a year
ago, according to preliminary figures. W h ole
sale com m odity prices moved downward dur
ing November and the first half of December.
Production and Employment. Production in
basic industries decreased by nine per cent in
November according to the Board’s index, and
was five per cent lower than a year ago. The
decline in production, which began in midsum
mer, was restricted prior to N ovem ber largely
to industries in which the expansion during the
earlier part of the year had been exceptionally
rapid, particularly iron and steel, automobiles,
and related industries. The same industries
showed the largest reductions in November, but
there were declines also in the copper, cotton
and w ool textiles and shoe industries, and in
smaller degree in silk textiles and coal. Pro
duction of crude petroleum was also curtailed.
Volum e of building contracts awarded during
the month continued to be considerably smaller
than in the corresponding period of 1928. Em
ployment in factories was also reduced during
Novem ber to a level slightly below a year ago,
and there was a somewhat larger decrease in
factory payrolls. The decline in employment
since midsummer, however, has been relatively
smaller than that in the physical volume of pro
duction. Employment wras in smaller volume
than in November a year ago in the automobile,
PER CENT
iron and steel, lumber and rubber products in
dustries, and larger in the machinery, textiles,
paper and printing, leather, and chemicals in
dustries.
Distribution. Distribution of commodities, as
measured by freight carloadings, was in smaller
volume in November than in October, reflecting
larger than seasonal decreases in most classes
of freight. Miscellaneous freight in less than
carload lots, which includes chiefly com m odi
ties for retail trade, showed the usual seasonal
change, however. Department store sales in
leading cities during the month were about one
per cent larger than last year, according to pre
liminary figures. Increased sales were reported
in four agricultural districts— Richmond, Kan
sas City, Dallas, and San Francisco. In certain
of the large industrial districts— Boston, New
York, and Cleveland, sales were approximately
the same as in November, 1928.
W holesale Prices. W holesale prices were at
a lower level in November than in October and
continued to decline during the first half of
December. The downward movement, which
had previously involved principally com m odi
ties sold on organized exchanges, became gen
eral during the latter part of the period.
Bank Credits. Liquidation of bank credit,
which had begun early in November, continued
throughout that month and the first two weeks
of December, and on December 11 total loans
and investments of reporting member banks
were at about the same level as on October 23,
PER CENT
0 .."" 1"
)
--------
(
PAYRi DLLS
A
A
/A f t
3 'V
)
FfctPi
A
V '
1"1V M F 'ïd T
\T
1925
adjusted for seasonal variations (1923-1925 average =100).
Latest figure, November, 107.
1926
1927
1928
1929
1930
F A C T O R Y E M P LO YM E N T A N D PAYROLLS
Index numbers of factory employment and payrolls, without adjust
ment for seasonal variations (1923-1925 average = 100). Latest
figures, November, employment 98.2, payrolls 102.0.
90
December, 1929
MONTHLY REVIEW OF BUSINESS CONDITIONS
prior to the increase caused by the withdrawal
of funds by non-banking lenders. A t member
banks in New York City loans were somewhat
larger and investments considerably larger on
December 11 than on O ctober 23, while at
reporting banks outside New York loans on
PER CENT
leased reserve funds in more than sufficient
volume to meet the export demand for gold
amounting to 65 million dollars during the
period, as well as the seasonal currency require
ments. Between November 6 and December 18
United States security holdings of the ReDILLIONS OF DOLLARS
1927
W H O L E S A L E P R IC E S
Index of United States Bureau of Labor Statistics (1926=100, base
adopted by Bureau). Latest figure, November, 94.4.
securities, all other loans, and investments were
smaller than on that date. Reserve Bank credit
outstanding was also reduced during November
and the first two wreeks of December, largely
in consequence of reduction in balances of
member banks at the reserve banks, which
accompanied the liquidation of member bank
credit. The decrease in reserve balances re
1928
1929
M E M B E R B A N K C R E D IT
Monthly averages of weekly figures for reporting member banks in
leading cities. Latest figures are averages of first two
weeks in December.
serve Banks increased considerably, while their
holdings of acceptances declined somewhat, and
there was a reduction of 250 million dollars in
the indebtedness of member banks. M oney rates
in the open market continued to decline and
the discount rate, which had previously been
reduced at five Reserve Banks, was lowered at
the Kansas City bank from 5 to Ay2 per cent.
TW ELFTH FEDERAL RESERVE D ISTRICT CONDITIONS
Industrial and trade conditions in the Twelfth
Federal Reserve District were somewhat less
favorable during November than in October,
1929, or November, 1928. The credit situation
is still showing the effects of the financial read
justments of late October and early November.
The agricultural outlook was definitely im
proved by the rains and snows of early D ecem
ber, which follow ed upon a long period of
sub-normal rainfall in most agricultural areas.
Considering the 1929 agricultural season as a
whole, crop production in the District was
smaller in volume than in 1928. Prices received
for many important crops, however, have been
higher during the last half of the year than a
year ago and on the basis of present market
prices and financial returns already received
the total value of the 1929 crops is likely to be
slightly greater than, or approximately the
same as the value of the 1928 crops. Prices of
commodities which the farmer buys have aver
aged about the same this year as in 1928.
Seasonal declines from O ctober to N ovem
ber in the building, lumber, mining, and flour
milling industries were greater than usual. N ot
withstanding declines in production, stocks of
lumber, metals, and flour were substantially
larger at the end of November, 1929, than at
the end of November, 1928. Production of pe
troleum in California declined sharply early in
November, reflecting partial success of con
tinued attempts to exercise some degree of
control over output. Employment in most in
dustries declined seasonally during the month.
During early N ovember the wholesale com
modity price level continued the decline which
has been in progress since July. The rather
rapid decline of early Novem ber was tem po
rarily checked by increases in prices of some
agricultural products during the latter part of
that month and decreases have been less
marked since that time.
Trade was less active during November than
in the past few months, and was at lower levels
than in November, 1928. The decline was
shown in sales of wholesalers and in smaller
shipments on the District’s railroads. Depart
ment store sales increased as compared with
November, 1928, and, after allowance for the
usual seasonal increase, showed no change
from October, 1929. Stocks of those stores
were slightly larger at the end of November
this year than at the end of November, 1928.
There was a non-seasonal decline in the
volume of money in circulation during N ovem
ber and the first three weeks of December which
was in contrast with the usual increase of sev
eral million dollars during these months. M em
ber banks reduced their borrowings at the
Reserve Bank by 69 million dollars between
FEDERAL RESERVE AGENT AT SAN FRANCISCO
December, 1929
November 20 and December 18. This reduction
was made possible by large transfers of funds
into the District, by an offering of Treasury
certificates of indebtedness which furnished a
temporary supply of credit for member banks,
and by the decline in volume of currency in
circulation. On December 6 the Federal R e
serve Bank of San Francisco lowered its dis
count rate from 5 to 4 per cent. Its acceptance
buying rate for short maturities was reduced
from 4 % to 4 per cent on Novem ber 25.
Agriculture
During December, the agricultural situation
in the Twelfth District improved greatly. Rain
and snowfall relieved an acute water shortage
on livestock ranges and irrigation watersheds,
added to the supply of soil moisture for future
crop production, and reduced fire hazard to a
minimum. During the first half of December
the rainfall in most areas nearly equaled the
normal precipitation for the entire month. The
heavy rains of this period brought rainfall fig
ures for this season up toward the average of
past years.
Arizona
Flagstaff
R A I N F A L L —-Twelfth District
(in inches)
December 1— December 16 July 1— December 16
1929
Normal
1929
Normal
0.0
1.2
6.2
11.5
............
5.0
0.0
0.5
3.1
California
Eurêka ..............
Fresno .................
Los Angeles . .
Red Bluff .........
Sacramento . . .
San Diego . . . .
San Francisco .
Idaho
Boise
6.1
0.5
0.0
,
.
..
,
0.0
So u rce: W eather
culture.
3.0
1.2
1.5
3.0
1.9
0. 9
2.5
6.3
0.5
0.3
4.1
4.2
0.2
3.0
13.4
2.9
3.6
7.6
4.9
1.3
6.3
0.5
1.1
1.2
4.4
1.7
0.7
2.3
2.9
0. 7
6.7
6.0
1.1
4.5
3.5
1.5
9.2
8.4
12.1
,
0.0
1.0
4.1
5.9
3.7
1.4
3.6
1.5
7.1
..........
14.0
6.5
...................
Nevada
R eno ...................
Oregon
Baker City . . . .
Portland ............
R oseburg ..........
Utah
Sait Lake City
W ashington
Seattle
..............
Spokane ............
4.0
4.0
5.0
.
,,
,
.
.
.
Bureau— United
States
2.2
4. 6
16.8
Department of A gri-
Unfavorable weather during the grow ing sea
son reduced both quality and yields of crops
produced in this District during 1929, but a
generally favorable harvesting and marketing
period has done much to make the year a suc
cessful one for agriculture. The price level of
agricultural products and the volume of mar
keting in proportion to total production have
been well maintained during most of the mar
keting season. Latest available estimates pre
pared by the United States Department of A gri
culture have confirmed earlier reports which
indicated that, despite the smaller volume of
crops produced this year, total crop value would
probably be about the same as a year ago.
Exports of wheat from Puget Sound and Co
lumbia River ports during N ovem ber were 44
91
per cent smaller than in October, 1929, and 34
per cent smaller than in November, 1928. Dur
ing the season from July to December, 1929, ex
ports were 33 per cent smaller than during the
same period in 1928. Similarly exports of
barley from San Francisco during the period
July 1 to December 1 were eight per cent
smaller than exports during the same period
in 1928.
Market shipments of the District's commer
cial apple crop (35,286,000 bushels) had totaled
29,671 carloads (22,431,000 bushel boxes) by
December 1. On December 1, 1928, it was esti
mated that 41,504 carloads (31,377,000 bushel
boxes) of the 1928 commercial apple crop (47,731,000 bushels) had been shipped. December 1
storage holdings of the smaller 1929 crop in
W ashington and California were seven per cent
and 22 per cent less, respectively, than on D e
cember 1, 1928. Shipments of the Navel orange
crop from California during November, 1929,
were three per cent or 805 carloads less than
shipments during November, 1928. Early in D e
cember the 1929-1930 Navel orange crop in
California was estimated to be 10,300,000 boxes.
The 1928-1929 crop was 17,500,000 boxes.
Lem on shipments from California during N o
vember were 372 carloads as compared with 663
carloads shipped during November, 1928.
Lemon and orange prices at California shipping
points were higher in November, 1929, than in
November, 1928.
A sharp decline in butter prices during the
second week of December reflected partly sea
sonal conditions and partly the presence of
large storage stocks of butter at Pacific Coast
markets. Nearly 3,500,000 pounds of butter
were in storage at these markets on Decem
ber 1, compared with about 2,500,000 pounds
held a year ago. E gg prices also dropped sea
sonally during the first half of December but
were higher than last year. Cold storage stocks
of eggs declined and on December 1, were 10
per cent smaller than on December 1, 1928.
R A N G E C O N D I T I O N S —Twelfth District
(Normal = 100)
A riz. Calif. Idaho N ev.
Ore. Utah W ash.
46
76
85
65
91
67
Decem ber 1, 1929____ 90
64
78
79
72
98
68
N ovem ber 1, 1 9 2 9 . . . 100
D ecem ber 1, 1 9 2 8 . . . 70
78
78
66
80
76
78
Source:
United States Department of Agriculture.
The rain and snowfall of early December re
lieved what had threatened to become a serious
situation for the livestock industry. Thus far
this season stockmen in most range areas of the
District have had to use more supplementary
feeds than is customary and much forced mar
keting of livestock has been in evidence. As a
result of this feeding the condition of livestock
has not entirely reflected the poor condition of
ranges.
The number of cattle on feed in the principal
far-Western feeding states which supply Pacific
Coast markets was substantially less on De-
92
cember 1, 1929, than on Decem ber 1, 1928. In
the m id-W est, however, the movement of cattle
to feedlots prior to the same date was slightly
greater than a year ago. The number of lambs
on District feedlots has increased but little dur
ing the past year, while the number on midW est feedlots has increased by six per cent.
L IV E S T O C K — Market Receipts
c
December, 1929
MONTHLY REVIEW OF BUSINESS CONDITIONS
j
N o v e m b e r ...................
A u gu st through
N o v e m b e r ..............
r “Twelfth District*—'»-— M id -W e s t f—'
1929
1928
1929
1928
81,113
87,035
793,883
742,583
301,184
329,540
3,704,948
3,565,329
Sheep
N o v e m b e r ................... 218,064
A u gu st through
N o v e m b e r .............. 1,613,451
H ogs
N ovem ber .................
A u g u st through
N o v e m b e r ..............
210,431
1,578,747
1,155,158
6,588,879
1,153,138
6,443,716
224,549
210,098
2,144,155
1,970,335
696,708
681,885
6,740,258
7,176,444
^Seattle, Spokane, Tacom a, Salt Lake City, O gden, Portland,
L os A n geles, and San Francisco,
fC h icago, Kansas City, Om aha, East St. Louis, St. Joseph, Sioux
City, and St. Paul.
Receipts of sheep and swine at Pacific Coast
and inter-mountain markets during November
and during the current marketing season (A u
gust 1 to Decem ber 1) were larger than during
the same tw o periods in 1928. A similar com
parison of cattle receipts shows a decline as
compared with a year ago. Changes in live
stock receipts at Twelfth District markets have
been in partial contrast with changes in receipts
at m id-W estern markets over the year period.
In d u stry
Greater than seasonal declines in Twelfth
District industrial activity were reported dur
ing November. Non-ferrous metals mining,
lumbering, building and construction, and flour
milling were all less active than a year ago.
Early in the month the petroleum industry
effected a considerable voluntary reduction in
output of crude and refined oils. Despite re
duced production there was evidence of con
tinued accumulation of stocks of copper, lum
ber, petroleum products and flour— four of the
(A ) Industry—
Indexes of daily average production, adjusted for seasonal variations
(1923-1925 daily average = 100)
1928
t---------- -1 9 2 9 Oct. Sept. N ov.
M anufactures:
N ov.
Flour ........................................................
120 109
107
109
87
86
85
Slaughter of Livestock .................
89
L u m ber
................................................ ......... 103
102 111
103
204
215
163
Refined M ineral O ilst ................... ......... 196
93
113
Cement ................................................... . . . . 107
102
81
W o o l Consum ptionf ........................
105
91
M inerals:
132
101
132
Petroleum (California) t ............... . . . . 107
124
133
Copper (United States) $ ............ . . . . 117
123
119
111
115
L e a d ’ (U n ited States ) % .................
80
92
93
Silver (U n ited States) $ ............... .......... 110
General :
106
102 113
Carloadings— Industrial .............. . . . . 106
Value of Building Permits §
59
69
64
60
Tw enty Larger Cities ...............
71
82
88
87
Seventy Smaller Cities ............ . . . .
V alue of Engineering Contracts
Aw arded§
111 115 123
T otal ..............................................
134
116
147
fNot adjusted for seasonal variation. {Prepared by Federal Re
serve Board. §Indexes are for three months ending on the
month indicated.
District’s most important products. The num
ber of workers employed in industry decreased
during November, but on the whole unemploy
ment at the end of that month was probably
less prevalent than a year earlier.
During November the petroleum industry in
California partially attained its objective of
voluntary control of crude oil production. Out
put during that month was approximately 25
per cent less than in October, although it was
greater than in November, 1928, and was larger
than the amount estimated as necessary to
supply current demand. Refineries continued
comparatively active during the month, but
their output was substantially smaller than in
October. Shipments of petroleum products con
tinued relatively large, although there was
some decrease as compared with October, due
chiefly to a reduced demand for gasoline on the
Atlantic coast. There is a seasonal decline in
demand for gasoline throughout the United
States during the autumn and winter months,
although the decline is much less marked in
this District than in the United States as a
whole. The decline during the past autumn was
smaller than usual in the Tw elfth District,
due probably to the mild, dry weather which
prevailed over much of the territory until midDecember. Nevertheless, consumption of re
fined oils fell considerably short of output
during the period and additions to stored stocks
were large.
Lum ber production declined seasonally dur
ing November and was about six per cent
smaller than in November, 1928. For the Dis
trict as a whole, both shipments and orders
declined at a more rapid rate than output, and
were but 82 and 80 per cent of production,
respectively. This tendency for shipments and
orders to decrease more rapidly than output has
persisted for five months and has resulted in
(B ) Employment—
t — ----- California— — \
r ~ N o . of
N o. r~ Employees
N o.
of
N ov.,
N o v .,
of
Industries
Firm9 1929
1928 Firms
All Industries........... 713 162,160 154,172
143
Stone, Clay and
Glass Products.
Lum ber and W o o d
Manufactures . .
Textiles
...................
Clothing, Millinery
and Laundering.
Food, Beverages
and T o b a c c o ...
W ater, Light and
Power ............
42
(3 .7 )
107 21,387
(— 7.9)
...
6,215
23,219
121
136
(— 11.0)
54
15,878
(6 .1 )
14,972
4
2,419
2,511
10
1,745
(2 1 .5 )
1,436
56
7,554
7,450
8*
468
(2 .9 )
455
150
(1-4)
25,846
24,686
39
3,386
(— 0.7)
3,409
28
5,548
(3 .3 )
5,371
18
^
10
Other In d u stries!. 318
Miscellaneous
________
6,447
■ Oregon ■
■■ ■%
N o. of
Employees —>
N ov.,
N ov..
1929
1928
27,146
25,779
(5.3)
12
(4 .7 )
13,595
(25.0)
82,856
(6.4)
2,056
(45.4)
10,873
77,904
1,414
^Laundering only, fln clu d es the follow ing industries: metals,
machinery and conveyances; 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
vember, 1928.
December, 1929
FEDERAL RESERVE AGENT AT SAN FRANCISCO
an accumulation of mill stocks of lumber. Dis
trict carloadings of forest products and eastbound shipments of lumber through the
Panama Canal were substantially smaller dur
ing November, 1929, than in October, 1929, or
in November, 1928.
The value of building permits and of engi
neering and construction contracts awarded
during November was well below the figures of
either the preceding month or the correspond
ing month of 1928. In the smaller reporting
cities of the District the declines in value of
building permits issued were relatively greater
than the declines in the larger cities. Engineer
ing and construction contracts for commercial
and industrial buildings declined by a smaller
percentage than did contracts for waterworks,
sewers, streets, roads, and government projects.
This Bank’s indexes of building permits issued
and of engineering and construction contracts
awarded for the three months ending Novem
ber 30, were well below the indexes for the
corresponding period of last year.
Mining of copper declined during November,
but output of silver was greater than in O cto
ber, 1929, or November, 1928. For several
months demand for copper has been decreasing
and mine stocks of that metal have been ac
cumulating since last spring. A number of long
time construction projects are under way at
the mines, and they have tended to stabilize
employment in the industry.
Flour mills of the District reduced their out
put during November and were less active than
in November, 1928. Stocks of flour held by the
mills of the District increased more than sea
sonally and at the end of the month were nearly
30 per cent greater than at the end of N ovem
ber last year.
(C) Distribution and Trade—
,-------------- 1929------------- > 1928
N ov.
Oct.
Sept.
N ov.
Foreign T rade0
/-----------Index Numbers*------------ ^
T o ta lt ...................................................................................
144
133
I m p o rts! ............................................................
••
120
127
E x p o r t s .................................................................
•.
156
138
Intercoastal Trade0
Total ............................................................ 107
105
100
94
W estbound ................................................ 146
147
150
138
Eastbound ................................................
97
93
87
82
CarloadingsJ
Total ............................................................ 109
109
107
113
Merchandise and M isc e lla n e o u s... 118
116
114
119
W holesale Trade§
Sales ............................................................ 112
1130
100
113
Retail Trade
Automobile Sales?
Total ....................................................... 120
134
145
117
Passenger C a r s .................................. 113
128
139
117
Commercial V e h i c le s ...................... 188
190
204
113
Department Store
Sales? ..................................................... 124
124
127
116
Stocksfl .................................................. 114
1130
110
110
r — ------- Actual Figures ----------- \
Stock Turnover||...........................................25
.27
.25
.23
C ollection s#
Regular .............................................
Installment ......................................
45.5
14.5
48.4
16.3
44.5
15.9
46.6
15.1
* Adjusted for seasonal variation, 1923-1925 a v e ra g e = 1 0 0 . fE x cluding raw silk. $Daily average. § M onthly totals of ten
lines combined. ffAt end of month. ||Proportion of average
stocks sold during month. ## P e r cent of collections during
month to amount outstanding at first of month. 0 Indexes
are for three months ending on month indicated. QRevised.
93
Trade
As compared with the levels established in
recent months, Twelfth District trade declined
during November but, in general, compared
favorably with that of November, 1928. Retail
sales were in moderately large volume, and
after making allowance for seasonal move
ments showed no' change from the previous
month. Department store sales were substan
tially larger than in November of last year, an
increase which may be partly discounted, how
ever, because sales of these stores were rela
tively small during November, 1928, and
because November, 1929, had five Saturdays,
whereas November, 1928, had but four. Sales
of new automobiles declined more than seaPER CENT
I30r
SALES
120
^ *
110
100 "U'T""
80 ....
1925
! « /V
V-, A t*’ * v- V
V
1926
1927
\Ar
/'• A
|/ V s
V 1
A
V
N
/ \
kAr J
\t V
i
STOCKS
1928
t
1929
D E P A R T M E N T S T O R E S A L E S A N D ST O C K S
Index numbers of daily average sales and of stocks at end of month
of department stores in the Twelfth District, adjusted for
seasonal variations (1923-1925 average=100).
sonally during November, but were somewhat
larger than in November, 1928. Intercoastal
traffic through the Panama Canal was in
smaller volume than in the previous month, but
was greater in volume than a year ago. Sales at
wholesale and freight carloadings declined as
compared with either last month or the corre
sponding month of last year. The foreign trade
of the District, during September, 1929, was
smaller than that of August, 1929, or Septem
ber, 1928, but the total for the third quarter
was relatively large, due chiefly to heavy ex
ports of petroleum and large imports of crude
rubber.
R E T A I L T R A D E —-Twelfth District
,----------N E T S A L E S * ----------,
Jan.1 to
N ov., 1929
N ov. 30,1929
compared
compared with
with
J a n .1 to
N ov.. 1928
N ov. 30,1928
6 .1 ( 71)
2.7 ( 66 )
Department S t o r e s f..
0.6 ( 28)
Apparel Stores ............ — 6.4 ( 31)
0.5 ( 49)
2.1 ( 44)
Furniture Stores..........
4.2 (151)
2.4 (138)
A ll Store s ........................
ST O C K *
N ov., 1929
compared
with
N ov., 1928
2.5 ( 52)
— 0 .1 ( 2 0 )
1.3 ( 29)
2 .2 ( 1 0 1 )
*Percentage increase or decrease (— ) . Figures in parentheses in
dicate number of stores reporting, f Includes dry goods stores.
For the District as a whole, retail sales
showed about the usual increase during N o
vember as compared with October, although
there were rather wide fluctuations in indi
vidual cities. Sales of department stores were
larger than in November, 1928, in nearly all
94
December, 1929
MONTHLY REVIEW OF BUSINESS CONDITIONS
sections of the District, but the ratio of cash
and C.O.D. sales to total sales declined sharply.
Department store stocks increased during N o
vember by more than the usual amount, and
their value at the end of the month was about
three per cent greater than a year earlier.
During N ovember sales at wholesale of 245
firms in ten lines of trade declined more than
seasonally but were only slightly smaller in
value than in November, 1928. Sales of agri
cultural implements showed a large percentage
increase over the year period, but their dollar
value is relatively small at this season. Lines of
trade which showed either small increases, or
little change as compared with a year ago, were
automobile supplies, drugs, dry goods, gro
ceries, hardware and paper and stationery. Sub
stantial decreases were reported for the other
three lines— electrical supplies, furniture and
shoes— upon which this Bank collects data. The
value of stocks carried by wholesalers was five
per cent larger at the end of Novem ber this
year than at the end of Novem ber last year.
PER CENT
as compared with October and shipments out
of the District declined by more than the usual
amount. Eastbound traffic for the three months
ending November 30 was large, however, and
the quarterly index advanced. As compared
with the same period last year all shipments,
except those of lumber, were in larger volume.
PER CENT
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 in the Twelfth District as reported by
the American Railway Association. Index numbers adjusted
for seasonal variations, (1923-1925 daily average = 100).
The value of the District’s foreign trade was
substantially less in September, 1929, than in
August, 1929, or September, 1928. Nearly all
sections of the Twelfth District showed some
declines in September as compared with August,
but by far the largest percentage decrease was
registered at Los Angeles, chiefly as a result of
sharply reduced imports of crude rubber. The
total value of the District’s export and import
(D) Bank Debits*—
R E G IS T R A T IO N O F N E W A U T O M O B IL E S
Indexes of daily average registrations of new passenger and commer
cial motor vehicles in the Twelfth District, adjusted for seasonal
variations (1923-1925 daily average = 100).
The number of registrations of new automo
biles (passenger and commercial) in the prin
cipal states of the District declined from
O ctober to Novem ber by more than the usual
amount, but was still three per cent larger than
in November of last year. The greatest per
centage decline was in registrations (sales) of
new passenger cars. Registrations (sales) of
new commercial vehicles decreased by little
more than the usual O ctober-N ovem ber de
cline.
Freight carloadings on the District’s rail
roads during November, 1929, were smaller in
number than in either October, 1929, or N o
vember, 1928. A ll classes of commodities, with
the exception of ore, grain and grain products,
and coal and coke, participated in the decline.
This Bank’s seasonally adjusted index of the
District’s intercoastal trade, which combines
figures of both east and westbound shipments
through the Panama Canal, declined during
November. Shipments into the District in
creased less than is usual during that month
Arizona
Phoenix
.... $
California
Bakersfield . .
Berkeley . . . .
N ov.,
1929
45,225
17,425
23,018
48,826
59,195
1,236,628
Long Beach.
L o s A n geles.
Oakland . . . .
2 2 6 ,3 3 7
Pasadena . . . .
41,055
Sacramento .
53,632
SanBernardino
11,492
San D iego . .
64,618
San Francisco 1,453,056
San Jose . . . .
42,308
SantaBarbara
17,941
Stockton . . . .
28,683
N ov.,
1928
$
43,006
16,437
22,049
40,680
58,324
1,122,458
219,940
38,657
51,023
10,9870
59,574
1,476,300
44,191
15,083
28,209
-— First Eleven Months —■*
1929
1928
$
475,059
$
386,226
159,046
235,257
375,666
692,214
13,520,375
2,608,736
451,221
571,854
125,525
709,914
15,685,332
353,754
189,864
316,370
157,032
240,295
391,988
608,936
11,742,149
2,681,191
441,393
551,574
117,8600
683,345
16,704,667
329,746
155,993
320,710
Idaho
18,288
16,109
173,242
169,752
14,022
11,265
143,166
110,758
8,390
220,493
8,512
210,361
Salt Lake City
28,447
91,343
23,220
78,740
222,233
913,168
209,990
827,333
W ashington
Bellingham . .
Everett ..........
Ritzville . . . .
Seattle ..........
Spokane . . . .
Tacom a
....
Y a k i m a ..........
9,903
13,078
877
289,412
5 9 ,9 7 6
50,588
20,937
9,765
13,576
1,167
224,486
55,959
46,371
17,957
116,709
155,197
10,079
3,047,268
678,614
560,153
169,994
110,435
149,867
11,570
2,690,528
623,286
506,832
156,842
Nevada
Oregon
Eugene ..........
Portland . . . .
87,841
2 ,182,996t
84,333
2,000,534
Utah
T o ta l.......... $4,195,193
$3,964,406$ $ 4 4,930 ,847 f $43,165,1650
* In thousands of dollars. t T o obtain a figure comparable with
that for 1928, subtract $66,400,000 for four banks not re
porting prior to week ended M ay 2, 1928. 0 Revised.
December, 1929
shipments during the third quarter of the year
was relatively high, however, because of the
exceptional activity during July and August.
Prices
A ccording to most indexes, the general level
of com m odity prices at wholesale was lower in
November than during any month in more than
two years. A decided downward movement of
prices has been revealed by the indexes in every
month, except June and July, since last March.
The relatively sharp decline of the preceding
three months continued until the middle of N o
vember, since when the trend has shown less
pronounced tendencies to move lower.
M ost notable of the price increases during
Novem ber was that of wheat. Reports of un
favorable crop conditions in Argentina stimu
lated demand both from Europe and from the
Orient, and helped to strengthen the listless
market which had prevailed up to the middle of
November. Price reductions, however, have ac
companied weakening market developments
during December. Poor range conditions, caus
ing an increased demand for supplementary
feeds, have helped to strengthen the barley
market. Livestock prices in the Twelfth Dis
trict moved erratically during November. Lamb
prices advanced, except in one or two markets
which received unusually large shipments. H og
quotations moved downward, and there were no
important changes in prices of cattle. An al
most continuous decline since January, 1929,
brought wool prices in early December to the
lowest point recorded in more than seven years.
During the last two weeks in November hide
quotations recovered much of the decline re
ported in the early part of that month. Pota
toes, beans, oranges, lemons, and some other
crops continue to bring a higher return to the
producer than they did last year.
Prices of lead, silver, and zinc continued to
decline throughout Novem ber and the first half
of December. The price of silver has not been
so low as it was on December 19, since the pre
war period, and quotations for lead and zinc are
at their lows for 1929. In contrast with this
situation, the price of copper has remained at
18 cents per pound, delivered Connecticut V al
ley points, despite a declining demand for and
relatively large stocks of that metal.
During the past month there have been no
changes in quoted prices for lumber produced
in this District.
Credit Situation
The effects upon the banking and credit
situation of the readjustments which occurred
at the close of O ctober and the beginning of
November are still plainly visible in this D is
trict.
95
FEDERAL RESERVE AGENT AT SAN FRANCISCO
The amount of loans extended by reporting
member banks was at record levels on D ecem
ber 18. On the same date the deposits of these
banks were still below the figures reached in
early October, prior to the heavy transfers of
funds to New York which characterized the last
days of that month and the early days of N o
vember. Borrowing from the Federal Reserve
Bank has been rapidly reduced since the middle
of November but the reduction was made pos
sible by a combination of special circumstances
(which are set forth below) rather than by a
change in the condition of member banks.
Although the peak of demand for reserve
bank credit in the District was reached on
November 20, there has been a continued ex
pansion of loans of member banks, especially
of loans on securities. Most of the increase oc
curred during the week of December 11-18 and
was due to the flotation of a large issue of
municipal bonds by the city of San Francisco.
On December 18 the amount of these loans as
well as of total loans was larger than at any
time since the figures have been compiled. D e
posits of these banks have also increased (a
gain of 23 million dollars of time deposits more
than offsetting a loss of 10 million dollars of
net demand deposits) but not so rapidly as
their loans, and the ratio of total deposits to
total loans has declined.
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)
r ------------------- Condition---------------—
Total Loans and Investm en ts. . ,.
Total Loans ......................................
Commercial Loans ..........................
Loans on Securities ........................
Investments ........................................
N et Demand D ep osits.....................
Tim e Deposits .................................
Borrowings from Federal R e
serve B a n k ......................................
D ec.18, Dec. 11,
1929
1929
1,978
1,957
1,430
1,403
973
980
457
423
548
554
784
775
947
950
58
66
Nov.20, D ec.19,
1929
1928
1,954
1,971
1,314
1,402
919
976
395
426
552
657
805
785
960
924
108
59
The amount of credit extended by the Federal
Reserve Bank of San Francisco increased 25
million dollars between October 30 and N o
vember 6. During the follow ing two weeks
there was a slight increase in reserve bank
credit outstanding, the peak being reached on
November 20, when rediscounts were 116 mil
lion dollars and total earning assets 160 million
dollars. During the succeeding four weeks
member bank borrowings were rapidly repaid
and, on December 18, rediscounts were but 64
millions and total earning assets 109 million
dollars.
Reduction of member bank indebtedness at
the same time that member bank loans were
increasing, was made possible chiefly by trans
fers of funds into the District amounting to 33
million dollars. There is ordinarily a movement
of funds into this District during December
which seems to be related to the desire of many
banks to liquidate indebtedness at the Reserve
Bank in anticipation of a call by the Comp
96
December, 1929
MONTHLY REVIEW OF BUSINESS CONDITIONS
troller of the Currency for a statement of con
dition on December 31. The greater part of the
funds thus far received have been for the ac
count of banks in Seattle and Spokane with
smaller gains to Salt Lake City and Portland.
There was a substantial outflow of funds from
San Francisco and Los Angeles.
Part of the flow of funds into the District
arose indirectly out of member bank purchases
of the Decem ber 15 offering of government se
curities. Banks of this District were allotted
25 million dollars of these 3
per cent cer
tificates of indebtedness, which were paid for
by a deposit credit to the Treasury. But g ov
ernment deposits of reporting banks increased
only 13 million dollars during the four-week
period, and their investments in United States
governm ent securities increased only six mil
lion dollars, indicating that a substantial part
of their allotment of certificates of indebtedness
was for the account of others or was imme
diately sold. Ordinarily the greater part of such
sales are made in markets outside the Twelfth
District and contribute to a gain in funds
through the gold settlement fund.
Other factors which contributed to the easier
position of member banks during recent weeks
include (1) Mint purchases of gold amounting
to four million dollars; (2) a decrease of eight
million dollars in money in circulation; (3) a
net excess of Treasury expenditures over re
ceipts in this District amounting to seven mil
lion dollars.
On Decem ber 6 the Federal Reserve Bank of
San Francisco reduced its discount rate from
5 to A l/ 2 per cent. On November 26 its buying
rate on bankers’ acceptances was reduced from
A J/ 2 to 4 per cent. (Maturities up to 120 days.)
The change in the discount rate placed the San
Francisco District upon a parity with the New
York, Chicago, and Boston Districts, where
the Reserve banks had already reduced their
rates. Follow ing the change in rates, member
banks increased their sales of local acceptances
to this Bank and reduced their rediscounts. No
change in interest rates charged to customers
by commercial banks has been reported during
recent weeks.
F E D E R A L R ESE R VE B A N K O F SA N F R A N C IS C O
(In millions of dollars)
r~
Total Bills and Securities..........
Bills Discounted .............................
Bills B o u g h t .......................................
United States Securities...............
Total R e s e r v e s ..................................
Federal Reserve Notes in
Circulation ....................................
Ratio of total reserves to deposit
and Federal reserve note liabilities combined ......................
Dec. 18,
1929
109
64
31
14
283
183
190
75.9
------Condi ition-------Dec. 11, N ov. 20, D e c .19,
1929
1929
1928
112
160
136
72
116
65
54
32
28
17
12
12
227
245
277
187
190
183
186
74.8
183
61.5
172
67.6
An interesting development of the past
month has been the unusual and non-seasonal
decline in the volume of money in circulation
in the District amounting to 12 million dollars.
This decline took place notwithstanding an
increase of six millions in Federal reserve note
circulation during the same period, as shown on
the chart at the bottom of this page. The di
vergent movements of these two series, which
usually fluctuate together, was due to heavy
redemptions of United States currency, unfit
for further circulation, and the substitution of
Federal reserve notes of the old series (large
size) for this currency which was redeemed. A
reduction in the amount of money in circulation
may indicate that the volume of cash sales of
goods and services is declining and/or that cur
rency is passing from person to person at a
faster rate and thus doing more work.
The figures of notes of the Federal Reserve Bank of San Francisco in actual circulation as shown above are the chief factor in the total demand
for currency in the District. Changes in the total demand for currency and not the actual amount of all currency in circulation are
shown by the other line in the chart. (Weekly figures).
@FedFRASER