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MONTHLY REVIEW
OF
B U S IN E S S
C O N D IT IO N S
ISA A C B. NEWTON, Chairman of the Board and Federal Reserve Agent
Federal Reserve Bank of San Francisco
Vol. X V II
San Francisco, California, February 20,1933
No. 2
T W E L F T H F E D E R A L R E S E R V E D IS T R IC T C O N D IT IO N S
Industrial activity of the Twelfth District
was about the same in January as in December.
This lack of change in the volume of production
conforms with the seasonal expectation. Em
ployment and payrolls decreased somewhat and
trade activity declined.
Heavier than usual snow and rainfall during
January in most parts of the District improved
the prospects for adequate irrigation water and
soil moisture to meet ordinary needs of agri
culture in the coming season. Unusually cold
weather together with driving rain storms
damaged certain crops, however, principally
wheat in the Pacific Northwest and citrus
fruits in southern California. Livestock gen
erally were kept in good condition by the use
of supplemental feeds, but the growth of early
lambs in California was hampered to some ex
tent by poor feeding conditions resulting from
freezing temperatures. The volume of agricul
tural products marketed was smaller in Janu
ary, 1933, than a year earlier and prices were
much lower.
Crude oil production, after decreasing con
siderably in late January and the first few days
of February, increased in the two weeks end
ing February 18. New orders for lumber con
tinued larger than production and output of
lumber declined less than seasonally during
January. The value of engineering contracts
awarded increased greatly during January, re
flecting principally construction to be under
taken by the Metropolitan W ater District of
Southern California. Building permits also in
creased in value because of the inclusion of per
mits for construction on the Golden Gate
Bridge, contracts for which were awarded last
November. Electric power production, which
affords a measure of activity in a wide variety
of industries in the Twelfth District, is esti
mated to have changed little during January,
after seasonal adjustment.
Considerably more than the usual postChristmas drop in department store sales took
place in January this year. Loadings of freight
on District railroads did not change, but inter
coastal traffic declined, allowance being made
for seasonal factors.
Several District banks failed during the last
half of January and the first half of February,
the most important of which were in California.
These suspensions were accompanied by a sub
stantial increase in demand for currency, espe
cially during the week ended January 25, when
banks found it necessary to increase their use of
Reserve bank credit considerably. In the fol
lowing three weeks local banks recalled fairly
large amounts of balances previously kept on
deposit in New York. This inflow of funds en
abled banks not only to meet additional with
drawals of currency and to reduce their borrow
ings from the Federal Reserve Bank of San
Francisco, but also permitted them to build up
their reserve deposits to the highest level in
more than a year.
Agriculture
Heavy rains during January brought total
rainfall for the season since July 1 approxi
mately up to the long-time average throughout
the seven western states, except in northern
California and western Nevada. Frequent
storms in the mountain areas resulted in an
accumulation of snow which should be suffi
cient to furnish adequate irrigation water dur
ing the forthcoming agricultural season.
A t the beginning of December, the United
States Department of Agriculture estimated
that approximately 3,832,000 acres had been
sown to winter wheat in California and the Pa
cific Northwest during the autumn of 1932.
This total represented an increase of about 5
per cent over the area sown in the autumn of
1931 when prolonged dryness had made sowing
conditions unsatisfactory. Considerable dam
age to winter wheat resulted from freezing tem
peratures during December and January. Part
of the damaged acreage will doubtless be re
planted in the spring months, at which time it
will be possible to determine more accurately
the probable acreage to be harvested in the Dis
trict this year.
10
M O N T H L Y R EVIEW OF
The volume of agricultural products mar
keted continues to be somewhat less than a year
ago. Partly because marketing is seasonally
small in volume during the first quarter of the
year, but also because of the low level of prices,
current returns to farmers are smaller than at
any time during the post-W ar period.
As a result of winds and rain storms in south
ern California, estimates of the Navel orange
crop were reduced from 14,992,000 boxes on
December 1, to 14,602,000 boxes on February 1.
RAINFALL—Twelfth District
(in inches)
January----- \ r—July 1-February 1—n
Nor
1932Nor
1931Arizona
mal
1932
1933 1932 mal
1933
14.7
15.8
14.1
.
2.2
1.7
2.2
Flagstaff ..............
6.4
0.1
1.3
7.0
6.1
Phoenix................ . 2.3
California
20.0
23.7
4.3
8.7
18.8
Eureka ................ . 7.7
8.8
5.3
1.6
2.0
5.2
Fresno.................. . 4.0
8.7
9.1
0.9
3.2
10.3
Los Angeles........ , 8.4
13.5
13.9
4.0
2.7
5.2
7.4
Red B lu ff............
9.2
9.8
1.2
4.1
5.3
Sacramento.......... . 2.8
6.4
5.2
0.9
2.4
7.9
San D iego ............ . 4.3
5.6
15.7
12.9
3.3
9.5
San Francisco . . . . 4.6
Nevada
1.1
1.9
2.6
5.3
5.0
Reno ....................
Idaho
1.9
5.0
1.3
4.5
6.7
Boise .................... . 1.0
Oregon
5.6
6.5
Baker.................... . 1.9
1.4
4.4
1.6
29.2
24.3
5.8
7.7
Portland .............. , 9.0
26.1
6.1
Roseburg.............. , . 8.5
4.2
16.6
19.5
19.0
Utah
0.9
6.9
Salt Lake City .... 2.1
1.5
7.6
7.8
Washington
20.7
3.8
5.5
25.4
18.1
Seattle................ .. . 5.5
1.8
1.9
7.2
10.3
8.9
Spokane .............. . 1.0
Source: Weather Bureau, United States Department of Agri
culture.
The estimated production of the 1932-1933
lemon crop was reduced from 6,508,000 boxes
to 6,453,300 boxes.
Pacific Coast production and stocks of butter
and eggs are smaller at the present time than
they were a year ago. Nevertheless, egg prices
declined 50 per cent during January, a decrease
somewhat greater than is customary during
that month, and butter quotations decreased
about 15 per cent.
A g r ic u ltu r a l M a r k e tin g A c tiv ity —
t------- January--------t— Season to Date— \
Carlot Shipments
Apples and Pears.
Citrus F ruits........
Vegetables .............
Exports
Wheat (bu.) ........
Barley (bu.) ........
Receipts
Cattle* ..................
Hogs* ....................
Sheep*....................
Eggs (cases)........
Butter (lb.) ..........
Wheat (carlots) . . .
Storage Holdings
(end of month)
Wheat ( b u .) ..........
Beans (bags) ........
Butter (lb.) ..........
Eggs (cases) ........
1933
3,848
4,448
5,291
1932
4,035
4,853
6,426
1932
49,595
15,325
21,755
479,500
952,389
1,291,007
107,566
2,500,900 17,530,190
5,293,139 3,859,857
44,146
202,259
158,539
123,302
6,250,605
2,664
53,252
216,014
222,940
148,231
6,409,205
4,082
44,146
202,259
158,539
123,302
6,250,605
29*365
53,252
216,014
222,940
148,231
6,409,205
37,086
2,891,000 2,880,000
.....................................
1,650,984 2,074,353
.....................................
715,064 873,959
.......................................
777 2,132
.........................................
•Receipts at Los Angeles not included.
1933
45,195
14,081
16,885
February, 1933
b u s in e s s c o n d it io n s
Although snowstorms and subnormal tem
peratures during January and February did
some harm to cattle and sheep on winter ranges,
the use of supplemental feeds kept livestock
generally in good condition. Young lambs have
not gained as rapidly as usual, however, the
growth of new feed having been retarded by
freezing temperatures. Shed lambing is pro
gressing satisfactorily in Idaho. Forage on
summer feeding grounds is expected to be
plentiful this year, the outlook being favored by
current rains and by the heavy snowpack in
higher altitudes.
LIVESTOCK ON FARMS AND RANGES—Twelfth District
(In thousands)
Number
January 1
1933 ................
1932 ................
1931 ................
1930 ................
1929 ................
1928 ................
1927 ................
1926 ................
..........
..........
..........
..........
..........
..........
..........
..........
Value
January 1
1933 ................
1932 ................
1931 ................
1930 ................
.......... $ 55,000
..........
74,000
.......... 108,000
.......... 131,000
Dairy
Cows*
1,568
1,594
1,524
1,496
1,461
1,420
1,403
1,390
1928 ................ .......... 111,000
1927 ................ .......... 102,000
97,000
1926 ................ ..........
Other
Cattle**
4,096
4,084
4,071
3,944
3,952
4,124
3,991
4,156
$ 71,000
91,000
139,000
175,000
192,000
153,000
135,000
134,000
Sheep
12,671
13,854
14,598
14,109
14,335
13,673
13,217
12,545
Hogs
1,607
1,591
1,334
1,314
1,539
1,677
1,465
1,235
$ 39,000
51,000
86,000
130,000
161,000
116,000
139,000
141,000
$ 6,600
9,600
14,800
16,600
18,500
22,100
23,900
18,400
*Cows and heifers two years old or over kept for milk. **Obtained
by subtracting number and value of dairy cows two years old
or over from total of all cattle and calves.
The aggregate value of livestock on farms
and ranges of the District declined 24 per cent
during 1932, according to the United States De
partment of Agriculture. The number of sheep
and lambs decreased 9 per cent, while the num
ber of cattle and hogs showed no change be
tween January 1, 1932, and January 1, 1933.
In d u stry—
Indexes of daily average production, adjusted for seasonal variations
(1923-1925 daily avera*e=100)
1933 ,------------1‘ >32 —
r— 1931— X
Jan. Dec. Nov. Oct. Jan. Dec. Nov.
General
42
44
45
36
40
Carloadings— Industrial.. 36
51
Electric Pwr. Production.
141 156 152
143 141 137
Manufactures
32
41
38
36
35
33
36
129 128 131
138 136 136
Refined Mineral O ils f...
75
107 116 115
75
83
78
Slaughter of Livestock..
87
92
79
81
88
83
42
40
41
42
57
Cement ............................ 37
56
87 120 139
96 113 132
Wool Consumption!
Minerals
72
Petroleum (California)t. 7111 71
71
76
76
76
40
59
64
58
Lead (United States)Î . . 45
38
45
37
Silver (United States) $. 36
30
38
48
36
40
Building and Construction!
44
42
28
40
Total ................................ 64
42
45
Building Permits— Value
9
10
10
19
21
24
Larger Cities .............. 10
Smaller Cities.............. 12
13
23
15
13
26
28
Engineering Contracts
Awarded— V alue
T o ta l.......................... 145
87
83
52
73
76
69
91
120 123 104
Excluding Buildings.281 162 150
tN ot adjusted for seasonal variations. {Prepared by Federal Re
serve Board. § Indexes are for three months ending with the
month indicated. fiPreliminary.
February, 1933
FEDERAL RESERVE AG EN T AT SAN FRANCISCO
Industry
Twelfth District industry showed little
change from December to January, after allow
ance for seasonal factors. As compared with a
year ago, the decline in production was one of
the smallest in about three years. Unemploy
ment was somewhat greater in January than in
December, according to reports from the seven
states of the District. Some increase in unem
ployment is ordinarily expected during January.
California petroleum output averaged sub
stantially lower between mid-January and midFebruary than in the preceding four-week
period. Reductions were greatest in late Janu
ary when producers in the Kettleman Hills
field voluntarily agreed to curtail output by an
additional 10 per cent in an effort to maintain
existing proration schedules and purchasing
prices for crude oil. Some curtailment followed
in other important fields with the result that
daily average output dropped to 457,900 barrels
in the week ending February 4, as compared
with a proration allowable of 440,000 barrels.
Part of this reduction was offset by increases in
the following two weeks, however, during
which period some of the voluntary restrictions
on output at Kettleman Hills were discontinued.
Accompanying the decline in production, the
quantity of crude oil run to refinery stills was
also reduced considerably. Notwithstanding
this decrease in refinery activity, gasoline in
ventories increased slightly.
The January decline in lumber production
was smaller than has been recorded in that
month in most other recent years and this
Bank’s adjusted index advanced from 32 to 36
per cent of the 1923-1925 average. A t that level,
the index is approximately the same as the
monthly average during 1932 and only 5 points
INDEX
below the figure for January of that year. The
volume of lumber orders, despite some increase
during the month, was considerably smaller
than in January, 1932. Orders continued to ex
ceed production by a small margin, however,
as has been the case during most of the past
year.
LUMBER PRODUCTION—Twelfth District
Index adjusted for seasonal variations (1923-1925 average=100).
A sharp rise in the value of construction dur
ing January may be accounted for almost en
tirely by greatly enlarged public works under
takings, including 33 million dollars of con
tracts awarded on projects of the Metropolitan
W ater District of Southern California and
about 12 million dollars of building permits
issued for the Golden Gate Bridge. Altogether,
the value of engineering contracts awarded
and building permits issued totaled 52 million
dollars, the largest amount in any month since
March, 1931, when Hoover Dam contracts
were awarded. Of this amount 12 million dol
lars of permits reported for the Golden Gate
Bridge appeared in engineering contract awards
in November. Consequently the value of con
struction included in the January total and not
NUMBERS
BUILDING AND CONSTRUCTION—Twelfth District
Indexes of building permits issued, engineering contracts awarded, and total building and construction, adjusted for seasonal variations
(1923-1925 average=100). Original data were smoothed by a three-month moving average.
11
12
previously reported approximated 40 rather
than 52 million dollars. This duplication has
been eliminated in the computation of this
Bank’s indexes. Construction initiated by the
Federal Government was maintained during
January at the relatively high level of other
recent months, but commercial, industrial, and
residential building remained at exceptionally
low levels.
A t the present time, stocks of raw materials
in the United States are considerably larger
than in 1929, while inventories of manufactured
goods are about 20 per cent smaller than at the
middle of that year, according to figures col
lected by the United States Department of
Commerce. Of individual products important
in the Twelfth District, estimated stocks of
copper accumulated rapidly to record high
levels during 1932, since when they have been
reduced only slightly, despite widespread pro
duction curtailment, including the complete
shutdown of many mines. Increases have also
taken place in stocks of lead, silver, and zinc.
On the other hand, California petroleum stocks
have been reduced by about 10 per cent dur
ing the past three years. Increases in lumber
stocks during 1930 and the first half of 1931
have been more than offset by decreases dur
ing the last year and a half, and inventories
are now approximately 30 per cent lower than
at the beginning of 1929. W orld supplies of
coffee, sugar, rubber, and silk, which play an
important part in the economic life of the
Twelfth District, but which are produced prin
cipally outside the United States, were much
larger in December, 1932, than at the end
Employment—
------- California-------- Oregon No. of
No. of
No. r-Employees
No.
<— Employees —>
of
Jan.,
Jan.,
Jan.,
Jan.,
of
Industries
Firms 1933
1932 Firms
1933
1932
All Industries*
..1,187 111,185 121,069
12,621
114
12,931
(-2.4)
Stone, Clay, and
(—8.2)
Glass Products. 53
3,305
4,353
Lumber and Wood
^ 24.1)
39
6,130
6,018
Manufactures . . 122 10,245 13,055
(1.9)
(— 21.5)
Textiles ................
14
1,342
1,524
8
1,195
1,071
(11.6)
Clothing, Millinery,
^ 11.9)
and Laundering 156
9,839 11,524
173
188
5Î
(— 14.6)
(— 8.0)
Food, Beverages,
34
1,183
1,277
and Tobacco . .. 301 25,197 26,250
(— 7.4)
(— 4.0)
Public Utilities . . 46 46,419 50,702
(— 8.4)
Other Industries!. 488 54,554 58,678
(— 7.0)
Miscellaneous . . . .
53
28
3,940
4,377
6,703
5,685
(17.9)
(—10.0)
Wholesale and
Retail................ 208 30,767 33,452
(—8.2)
*Public utilities and wholesale
this total, tlncludes the
chinery, and conveyances;
paints; printing and paper
and retail figures not included in
following industries: Metals, ma
leather and rubber goods; oils and
goods. {Laundering only.
Figures in parentheses indicate percentage change from January,
1932.
February, 1933
M O N T H L Y REVIEW OF BUSINESS CONDITIONS
of 1929. Although reductions were recently re
ported in world stocks of wheat and cotton,
they continue to be more than double the 19231925 average.
Trade
Department store sales receded more than
seasonally during January of this year and
were 27 per cent smaller than in January, 1932.
The decline from last year represented in part
lower retail prices. As compared with DecemRETAIL TRADE—Twelfth District
Percentage changes in value of sales and stocks
with no adjustment for price changes
/— 1933 compared with 1932 —%
NET SALES
STOCKS
January
January
Department Stores ......................
— 20.0 (52)
. — 26.8 ( 70)
Los Angeles..............................
— 27.6 ( 9)
— 19.0 ( 9)
Other Southern California
— 21.8 ( 8)
— 22.6 ( 5)
. . — 33.2 ( 4)
— 23.1 ( 4)
San Francisco............................ . . , . — 26.0 ( 7)
— 17.6 ( 7)
Bay Region................................
— 19.1 (15)
15)
Central California ....................
— 27.3 ( 6)
— 8.1 ( 6)
— 27.1 ( 8)
Portland!.................................... . . . . — 28.8 ( 8)
. . . — 21.5 ( 5)
— 29.1 ( 4)
Spokane .................................... . . . . — 29.9 ( 4)
— 11.5 ( 4)
Salt Lake City ........................ ., . . . — 18.7 ( 4)
— 14.0 ( 3)
Apparel Stores..............................
— 28.8 ( 26)
— 23.9 (15)
Furniture Stores.......................... . . . . — 38.3 ( 35)
— 28.7 (27)
...... — 28.3 (131)
— 21.5 (94)
flncludes six apparel stores which are not included in District
Department store total.
Figures in parentheses indicate number of stores reporting.
Note: These figures take no account of operating costs.
ber, sales decreased most sharply in Los A n
geles, San Francisco, and Salt Lake City, the
January decline reported by stores in Oakland,
Spokane, and Seattle having been of approxi
mately seasonal proportions. Inventories de
creased slightly, as is customary in January.
Freight carloadings declined seasonally dur
ing January, and this Bank’s adjusted index
D istr ib u tio n a n d T r a d e —
1933 ,--------------1932--------------N , 1931----- n
Jan. Dec. Nov. Oct.
Jan. Dec. Nov.
Indexes adjusted for seasonal variations
/-------------- (1923-1925 average=100)-------------- \
54 54
58
59
66
65
67
67 68
74
72
81
80
82
Carloadingst
Total ......................
Merchandise..........
Foreign Trade0
Totalf ............................ .....43
I m p o r ts !........................ .....43
Exports .......................... ..... 44
Intercoastal Trade
Total ...................... 51 56
Westbound ............ 56 58
Eastbound.............. 48 56
Retail Trade
Automobile Sales$
Total .......................... ..... 35
Passenger.................. ..... 32
Commercial................ ..... 62
Department Store
S ales*.................. 60 68
Stocks§................ 60 61
Collections#
Regular ..........
Installment . . .
43
41
45
46
39
50
56
51
59
55
51
57
58
53
61
60
66
57
62
70
58
51
80
42
65
77
63
56
74
51
32
30
52
28
26
50
48
45
84
62
57
115
45
41
86
63
63
75
61
84
78
85
81
92
82
/--------------------A <*ual Figures-------------------- *
42.6 40.7 41.8 43.3
42.5 41.0 41.9
14.1 12.8 13.4 14.7
14.6 13.3 13.9
{Daily average. 0Indexes are for three months ending with
month indicated. fExcluding raw silk. §At end of month.
#Per cent of collections during month to amount outstanding
at first of month.
February, 1933
13
FEDERAL RESERVE A G E N T A T SAN FRANCISCO
remained at 54 per cent of the 1923-1925 aver
age, a point slightly above the record low figure
of last August. Carloadings advanced sharply
last September and continued at the higher
PER C E N T
CARLOADINGS—Twelfth District
Index adjusted for seasonal variations (1923-1925 average=100).
level during October, since when declines have
been reported each month. January, 1933, load
ings were about 20 per cent below loadings in
January, 1932.
The value of wholesale sales decreased 13 per
cent during January and was 20 per cent smaller
WHOLESALE TRADE—Twelfth District
Percentage changes in value of sales with
no adjustment for price changes
January, 1933
-----compared with------>
Jan., 1932
Dec., 1932
— 47.2
Agricultural Implements.............. .............. — 3.1
Automobile Supplies .................... .............. — 18.8
— 12.8
D rugs................................................ .............. — 5.4
— 10.6
Dry Goods ...................................... .............. — 10.7
— 16.4
— 24.7
Electrical Supplies.......................... .............. — 34.7
Furniture.......................................... .............. — 0.8
— 28.6
— 19.7
— 23.8
Hardware ........................................ .............. — 22.3
..............
—
32.9
—
26.2
Shoes ................................................
— 22.1
Paper and Stationery.................... .............. — 12.0
All Lines.......................................... .............. — 12.7
— 20.1
Note: These figures take no account of operating costs.
than in the corresponding month a year earlier.
As compared with December, activity in all re
porting lines decreased, although sales of agri
cultural implement, drug, dry goods, grocery,
and shoe firms ordinarily increase from Decem
ber to January. O f the lines customarily show
ing declines in sales during January, automo
bile supplies and electrical supplies dealers re
ported more than the usual contraction, paper
and stationery sales decreased by about the sea
sonal amount, and furniture houses reported
less than the usual decrease. In the past, hard
ware firms have reported January sales about
equal to sales during December, but this year a
decrease of 22 per cent was recorded.
Intercoastal traffic decreased, contrary to the
usual tendency during January, but was ap
proximately the same as in the corresponding
month a year earlier. Cargo transported from
the Atlantic to the Pacific Coast was consider
ably smaller in January, 1933, than in January,
1932, but eastbound traffic through the Panama
Canal— consistently larger in volume than west
bound tonnage— increased, in part reflecting
larger petroleum shipments in the later year.
Prices
A sharp decline in commodity prices was
recorded during January. Although the down
ward movement was general throughout most
commodity groups, the larger reductions oc
curred in farm products and foods. The Bureau
of Labor Statistics’ monthly index of whole
sale prices was 61.0 (1926=100) in January as
compared with 62.6 in December and 67.3 in
January, 1932. Most weekly price indexes were
comparatively stable during the first three
weeks of February.
Contract wheat prices at Chicago advanced
by a small amount during January. California
barley, rice, potato, and bean prices remained
relatively stable at low levels, while hay prices
declined. Apples, oranges, and lemons— prac
tically the only fresh fruits now being mar
keted from this region— sold lower at the end
of January than at the beginning of the month.
Quotations for dried fruits advanced slightly
in January. Canned fruit prices remained un
changed during January, but declined in Febru-
C o m m o d ity P ric e s—
Unit
W heat.......................... No. 1 Western White, Seattle, Washington.
Barley.......................... Cash shipping, San Francisco...........................
Oranges...................... Weighted average f.o.b. California.................
Apples ........................ California Newtons, San Francisco.................
Cattle.......................... Good grade steers, San Francisco...................
Lambs ........................ Light weight, San Francisco...........................
Wool .......................... Fairchild average price, domestic wool, scou
Butter ........................ 92 Score, San Francisco...................................
E g g s ............................ Cash, Extras No. 1, San Francisco.................
Prunes ........................ 40/50’s in 25 pound boxes, f.o.b. California.
Flour .......................... Patent, Portland, Oregon.................................
Canned Salmon.......... Alaska Red, No. 1 tall, f.o.b. Pacific ]
Sugar .......................... Beet, f.o.b. San Francisco.....................
Petroleum .................. Crude, California ...................................
Gasoline .................... Refinery, California.................................
Copper........................ Electrolytic, spot, New York...............
Lumber ...................... Common timbers, Pacific Northwest.
Newsprint .................. New York and vicinity ......................
bushel
bushel
box
box
cwt.
cwt.
pound
pound
dozen
pound
barrel
dozen
dozen
cwt.
barrel
gallon
pound
1000 ft. B. M.
cwt.
barrel
1930
$ 1.23
1.50
4.08
2.60
11.50
12.80
.80
.36
.36
.115
6.866
2.45
2.85
5.20
.85
.069
.18
20.00
3.10
1.576
jamlary
1931
1932
$ .68
$ .64
1.10
1.25
2.04
1.53
1.75
1.75
9.10
6.25
7.60
5.50
.60
.49
.26
.24
.23
.20
.06
.475
4.876
4.677
1.65
1.55
2.92
2.22
4.70
4.15
.88
.65
.071
.058
.10
.0725
15.50
15.00
3.10
2.65
1.578
1.321
1933
$ .57
.70
1.67
1.35
4.80
5.45
.40
.21
.22
.425
4.239
1.25
1.40
3.75
.69
.053
.05
10.50
2.25
1.426
14
M O N T H L Y REVIEW OF BUSINESS CONDITIONS
ary, reflecting a few forced sales to liquidate
certain stocks of canned goods. Cattle and
lamb prices strengthened during January as the
number of good quality stock reaching market
decreased. Quotations for hogs showed prac
tically no change at Pacific Coast markets.
Scattered reductions in the retail prices of
gasoline were reported during January and the
first half of February. Quotations for crude oil
remained unchanged.
Sales of non-ferrous metals continued small
during January and no important changes in
quotations were reported. W ool, hides, sugar,
lumber, cement, and rubber changed little in
price during January.
Credit Situation
The principal credit developments of the
Twelfth District between mid-January and midFebruary were those associated with the failure
of several banks. These failures, of which the
most important were in northern California,
were accompanied by large withdrawals of cur
rency and an increase in borrowing at the Fed
eral Reserve Bank of San Francisco. Subse
quently, however, a substantial volume of bank
ers’ deposits was recalled from New York, and
member banks were enabled to reduce their use
of reserve bank credit and to build up their re
serve deposits.
There were 21 bank failures in the Twelfth
District during January and 8 during the first
15 days in February. Thirteen of the banks
B a n k D e b its* —
Arizona
Phoenix................................
California
Bakersfield ..........................
Berkeley ..............................
F resno..................................
Long Beach ........................
Los Angeles........................
Oakland................................
Pasadena ..............................
Sacramento..........................
San Bernardino..................
San D ie go ............................
San Francisco....................
San Jose ..............................
Santa Barbara....................
Stockton ..............................
Idaho
Boise ....................................
Nevada
Reno ....................................
Oregon
Eugene ................................
Portland ..............................
Utah
Ogden ..................................
Salt Lake C ity ....................
Washington
Bellingham ..........................
Jan., 1933
$ 17,311
Jan., 1932
$ 27,297
6,512
12,225
13,174
22,715
508,214
189,101
19,018
37,317
5,541
31,344
602,942
13,650
8,160
10,640
8,778
19,474
19,486
34,577
692,777
203,346
29,991
48,206
8,482
45,212
764,507
21,048
12,341
16,110
................
9,505
13,017
................
4,165
8,212
................
................
2,611
81,619
4,467
107,215
................
................
7,976
44,834
10,906
60,384
................
................
................
................
................
................
................
................
................
................
................
................
................
................
..................
................
3,596
Seattle .................................. ................
Spokane ................................ ................
T acom a................................. ................
Yakima ................................
101,108
21,232
15,910
5,111
6,864
146,470
32,010
25,941
8,755
T otal.................................. ................
$1,800,538
$2,380,984
*In thousands of dollars.
February, 1933
closed were in California, 6 were in W ashing
ton, and 5 each were in Oregon and Idaho.
These suspensions were accompanied by runs
on other banks and a rapid payment of cur
rency to the public. During the week ending
January 25, when failures were most numerous,
the demand for currency increased 21 million
dollars. A slight decrease in the following week
was considerably more than offset by increases
in the two weeks ending February 15.
SUPPLY OF AND DEMAND FOR FUNDS USED AS
BANKING RESERVES-Twelfth District
Changes in millions of dollars during the weeks indicated
Week
Ending
1933
January
January
January
January
February
February
February
SOURCES OF FUNDS
Monetary
Reserve
Gold
Treasury
Bank
Stock Operations Credit
2.9
.2
3.1
4 ........................
4.2
— 4.7
11........................ — 7.4
18........................ — 9.0
4.0
1.4
2.2
11.0
25........................ ..........2
1........................ — 2.7
.6
4.6
8 ........................
16.8
6.4
— 12.1
15........................
20.4
— 9.1
2.7
Total
Supply
6.2
— 7.9
— 3.6
13.4
2.5
11.1
14.0
USES OF FUNDS
Member
Week
Demand
Bank
Unexp’d
Ending
for
Reserve
Capital
Total
1933
Currency DepositsFunds, etc. Dem’d
3.3
2.4
.5
6.2
January
4 ........................
January 11........................ — 7.9
1.3
— 1.3
— 7.9
— 4.7
.9
.2
— 3.6
January 18........................
January 25........................
21.2
— 7.7
— .1
13.4
February 1........................ — 2.2
2.5
2.2
2.5
February 8 ........................
4.4
6.6
.1
11.1
7.3
6.4
.3
14.0
February 15........................
A s is usual when any sudden need for addi
tional reserve funds arises, the increased de
mand for currency was met for the time being
by a corresponding increase in member bank
borrowings from the Reserve Bank. During the
first half of February, however, local banks re
called a considerable part of the balances which
they had on deposit in New York. This inflow
of funds was used to some extent to reduce bor
rowings and to provide for additional currency
expansion, the remainder accumulating as ex
cess reserves of member banks. As a result of
these transactions, total reserves of the Fed
eral Reserve Bank of San Francisco were higher
in February than in any month since Septem
ber, 1931, and reserve deposits reached their
highest level since December, 1931. The with
drawal of bankers’ balances from eastern money
markets, reflected both a reduction from
per
cent to
per cent in rates paid by New York
banks on balances of out-of-town correspondents
and a desire on the part of District banks to
increase their balances at the Reserve Bank.
Banks in San Francisco and Los Angeles ac
counted for most of the decrease in balances
held outside the District and, consequently, it
was the reserve accounts of banks in those cities
that showed the principal increases.
District banks participated as usual in the
Treasury financing operations of February 1.
These banks were allotted 15 million dollars of
February, 1933
FEDERAL RESERVE A G E N T A T SAN FRANCISCO
IS
2
per cent Treasury notes maturing in 1938,
11 million dollars of which were paid for with
deposit credit. During the first two weeks in
February the Treasurer drew checks on a sub
stantial part of the Government deposits, but
when these checks were redeposited they re
duced the rate of decline in individual deposits.
Although part of the allotment of Treasury
notes to District banks was sold in national
markets for cash, total holdings of United
States securities by reporting member banks
increased 8 million dollars between January 18
and February 15.
Despite the continuance of bank failures and
the high level of currency circulation in the
District, the credit situation is less strained
than at this time last year. In January and Feb-
ment holdings increased and total loans and in
vestments changed little. Net demand deposits
were stable, while time deposits declined from
the relatively high level reached at the begin
ning of the year. Country banks reduced their
deposits with reserve city banks during this
period, but these latter banks more than offset
this movement by recalling large amounts from
their New York correspondents. Thus, while
reporting member banks had a larger amount
on deposit with correspondents between Janu
ary 18 and February 1 than they carried for
other banks, the usual relationship was restored
in the following two weeks, when city banks
reported a larger amount due to banks than due
from banks.
Recent bank suspensions in this District
FEDERAL RESERVE BANK OF SAN FRANCISCO
(in millions of dollars)
r----------------Condition -----------------\
Feb. 15, Feb. 8, Jan. 18, Feb. 17,
1933
1933
1933
1932
156
150
145
204
Total Bills and Securities ........
Bills Discounted......................
34
28
25
135
Bills Bought .......................... ..
2
2
2
19
119
119
118
48
United States Securities........
Total Reserves ............................ 282
265
243
217
Total Deposits ............................
171
157
154
162
Federal Reserve Notes in
241
221
246
Circulation................................ 247
Ratio of Total Reserves to De
posit and Note Liabilities
Combined..................................
67.3
66.5
65.0
53.4
REPORTING MEMBER BANKS—Twelfth District
(in millions of dollars)
----- Con< i ition----------------\
Feb. 15, Feb. 8, Jan. 18, Feb. 17,
1932
1933
1933
1933
Loans and Investments— Total.. 1,698
1,706
1,813
1,703
Loans— T o ta l............................
1,079
943
945
958
On Securities........................
235
233
237
297
All Other................................
782
721
710
710
Investments— Total..................
755
734
758
748
United States Securities . . .
425
427
417
401
Other Securities ..................
330
331
331
333
Reserve with Reserve Bank........
89
91
89
89
Net Demand Deposits................
574
569
568
597
Time Deposits..............................
919
907
911
880
Due from Banks ..........................
209
164
172
93
Due to Banks................................
181
185
204
143
Borrowings at Reserve Bank... .
17
26
20
115
ruary, 1932, there was a large outflow of funds
to other districts in contrast with an inward
movement of funds thus far during 1933. On
February 17,1932, borrowings from the Reserve
Bank were 135 million dollars, compared with
34 million dollars on February 15, 1933. In
January, 1932, 43 per cent of all member banks
borrowed from the Reserve Bank, while in
January of this year only 38 per cent of such
banks were borrowers.
Loans of city banks continued to decline be
tween January 18 and February 15, but invest
have been confined entirely to country areas.
A s a result, the comparability of the banking
figures included in the weekly report of city
banks has not been affected. In relation to the
total of all banking operations in the District,
however, the representation of those banks has
increased. More than 50 per cent of the total
loans and investments of all banks, national
and state, are now included in the weekly report
in comparison with approximately 40 per cent
during 1929.
S U M M A R Y O F N A T I O N A L C O N D IT IO N S
Prepared by the Federal Reserve Board
Volume of industrial production increased in
January by less than the usual seasonal amount
and factory employment and payrolls continued
to decline. Prices of commodities at wholesale,
which declined further in January, showed rela
tively little change in the first three weeks of
February.
Production and Employment. Industrial ac
tivity, as measured by the Board’s index, which
makes allowance for usual seasonal changes,
declined from 66 per cent of the 1923-1925 aver
age in December to 64 per cent in January,
which compares with a low level of 58 per cent
last July. Output of coal declined considerably,
contrary to the usual seasonal tendency. In
creases in activity in the cotton and silk indus
tries were somewhat less than seasonal in
amount, and there was a slight decline in
production at woolen mills. Output of shoes
increased seasonally. Activity in the steel in
dustry showed a seasonal increase during Janu
ary, and little change during the first three
weeks of February. Automobile production,
which had increased substantially in December,
showed a further slight increase in January.
Factory employment declined between the
middle of December and the middle of January
by considerably more than the seasonal amount.
Decreases were reported in most lines except
in the cotton, wool, and silk industries, where
16
February, 1933
M O N T H L Y REVIEW OF BUSINESS CONDITIONS
employment showed little change, and in the
automobile and shoe industries, where employ
ment increased.
Construction contracts awarded were in
about the same volume in January as in Decem
ber, according to the F. W . Dodge Corporation;
in the first half of February the value of awards
showed a decline.
try, and a decrease of $64,000,000 in the
country’s stock of monetary gold. These de
mands were met by member banks in part by
the use of their balances at the reserve banks,
which declined by $243,000,000 during the
period, but continued to be considerably above
legal requirements. Reserve bank holdings of
United States securities declined by $88,000,000
PE R C E N T
INDUSTRIAL PRODUCTION
WHOLESALE PRICES
Index numbers of industrial production, adjusted for seasonal varia
tions (1923-1925 average—100).
Indexes'of the United States Bureau of Labor Statistics
(1926=100).
Distribution. Volume of freight traffic was
somewhat smaller in January than in December,
reflecting a reduction in shipments of coal.
Sales by department stores decreased after
Christmas by more than the usual seasonal
amount.
Wholesale Prices. The general level of
wholesale commodity prices, as measured by
the index of the Bureau of Labor Statistics,
declined further from 62.6 per cent of the 1926
average in December to 61.0 per cent in Janu-
1928
1929
1930
1931
1932
1933
FACTORY EMPLOYMENT
Federal Reserve Board’s index of factory employment with
adjustment for seasonal variations (1923-1925 average = 100).
ary, reflecting substantial reductions in the
prices of crude petroleum, gasoline, textiles,
and dairy and poultry products. Prevailing
prices for wheat, cotton, and hogs in January
and the first three weeks of February were
somewhat above the low levels reached in
December.
Bank Credit. Between January 4 and Febru
ary 21 there was an increase of $319,000,000 in
the demand for currency, accompanying bank
ing disturbances in different parts of the coun
between January 4 and February 1, but in
creased by $70,000,000 during the following
three weeks; their holdings of acceptances in
creased by $141,000,000 and discounts for
member banks increased by $76,000,000.
Loans and investments of reporting member
banks in leading cities declined by about
$100,000,000 during the five weeks ending
February 15. The banks’ net demand deposits
declined by $390,000,000, reflecting largely re
ductions in bankers’ balances, and time deposits
1928
1929
1930
1931
1932
1933
MEMBER BANK CREDIT
Monthly averages of weekly figures for reporting member banks
in leading cities. Latest figures are averages of
first three weeks in February.
showed a decrease of $93,000,000 for the period.
Money rates in the open market were slightly
firmer during the first half of February. Openmarket rates on 90-day bankers’ acceptances,
which had been
per cent, had increased to
per cent by February 20. Rates on prime com
mercial paper and on stock exchange loans re
mained unchanged. The minimum buying rate
on bills at the Federal Reserve Banks of Boston,
New York, and Chicago was reduced from 1 per
cent to 3^2 per cent.
@FedFRASER