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MONTHLY REVIEW
OF
B U S IN E S S
C O N D IT IO N S
ISAAC B. N EW TO N , Chairman of the Board and Federal Reserve Agent
Federal Reserve Bank of San Francisco
Vol. X V III
San Francisco, California, March 20,1934
No. 3
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
Twelfth District business activity increased
further during February. Increases in output
of most industries required additions to work
ing forces which partly offset reductions in
employment by Federal Government agencies.
New construction awards were larger than in
any month since last June.
Rain and snowfall continued to be somewhat
less than normal during February, but mild
temperatures aided new crop plantings and im
proved the condition of growing crops and live
stock ranges. Increases in crop marketings as
compared with February, 1933, were accom
panied by substantially higher prices. Farmers’
cash income was further increased by Govern
ment payments for wheat acreage reduction.
Lumber cut expanded about seasonally, ac
companied by a further rise in new orders and
in shipments. Crude oil production averaged
slightly lower in February than in January, but
remained above Federal allotments. Slight
gains in non-ferrous metals mining were evi
dent. There was a sharp increase in both for
eign and domestic shipments of refined copper,
resulting in further reductions in copper inven
tories. Activity in the flour milling and meat
packing industries remained at a comparatively
high level.
After allowance for seasonal factors and for
changes in the number of trading days, the
value of department store sales increased dur
ing February. Wholesale sales were seasonally
smaller than in January, but were 45 per cent
larger than in February, 1933. Following a de
cline in January, automobile registrations in
creased considerably during February, this
bank’s adjusted index for that month standing
at 54 per cent of the 1923-1925 average, com
pared with 36 per cent in January. Freight carloadings expanded by approximately the sea
sonal amount. Intercoastal traffic was substan
tially larger in February than in January.
Federal Government disbursements in this
district exceeded local collections by 36 million
dollars during the four weeks ending March 21.
The resulting gain in banking reserves was
more than offset by transfers out of the district
aggregating 41 million dollars, and member
banks reduced their deposits at the Federal Re
serve Bank of San Francisco moderately. Hold
ings of Government securities by city banks
increased further during this period and, for the
first time since last September, investments in
securities other than those of the United States
Government increased by an appreciable
amount. Loans did not change during this
period. Exchange allotments of Government se
curities by the Treasury financing of March 15
had little effect on district banks since they
held but a small amount of the maturing issue.
Agriculture
Weather conditions during February and the
first half of March continued favorable for
spring planting and for the growth of range
forage and of crops previously seeded. Snowpacks have been comparatively light in most
mountain areas this season. It is now expected
that irrigation water will be scant during 1934
and considerably less plentiful than in the 1933
season when snowpacks were unusually heavy.
The volume of Twelfth District crops and
livestock marketed during February, 1934, was
larger than in February, 1933, and prices re
ceived by farmers averaged substantially higher
than a year ago. Farmers’ cash income from
crops sold during January and February was
supplemented by Government payments for
acreage reductions of the 1934 wheat crop. Such
payments in this district are estimated to have
totaled about 9 million dollars prior to the end
of February.
In the Pacific Northwest, the Emergency
Export Corporation continued to sell wheat for
export, sales totaling 22,300,000 bushels up to
March 15. This leaves about 13,000,000 bushels
of surplus wheat to be sold abroad, on the basis
of the estimate made last December that around
35,000,000 bushels would be sold by the Export
Corporation. W heat planted last autumn is in
good condition in most sections of the district.
Estimates of this season’s California Navel
orange crop remained unchanged during Febru
ary at 12,771,000 boxes. Extremely warm
weather caused a slight decline in the quality of
the fruit during the month. Shipments of Cali
fornia oranges, made in accordance with the
Agricultural Adjustment Administration mar
keting agreement, continued smaller than a year
ago. From November 1, 1933, to March 1, 1934,
shipments were 12 per cent less than in the
corresponding period last season, and 19 per
cent smaller than average shipments during
those months of the five preceding years. Prices
were lower than in January, reflecting ex
tremely cold weather in eastern markets and
heavy shipments of Florida oranges. Oranges
continued to sell higher than a year ago, but
the increase was not sufficient to offset the re
duced volume of shipments and producers’ in
come was lower than in 1933. Although it is
too early to estimate production of the 1934
Valencia orange crop with much accuracy, cur
rent reports indicate that the crop will be both
smaller than last year and of unusually good
quality. Lemon shipments were smaller in
February than in January but about 30 per cent
larger than in February, 1933. Prices also were
well above those of February, 1933.
Deciduous fruit orchards are reported to be
in good condition this year. Apricot, prune,
plum, peach, and almond trees are blooming
from two to four weeks earlier than usual
throughout California and the Pacific North
west, although the set of some fruits is reported
to be unusually light.
R A I N F A L L — Twelfth District
Arizona
Flagstaff ...................
Phoenix ....................
f------February— —>,
N or1934 1933 mal
0.9
0.8
3.4
1.0
0.1
0.9
Season to March 1 —^
N o r
mal
1933
15.6
17.5
7.1
7.3
1934
11.1
4.7
California
E u r ê k a ........................
F résno ......................
Los A n g e l e s ............
R ed B l u f f .................
Sacramento ............
San D iego ..............
San Francisco..........
2.3
1.8
2.0
3.0
3.0
1.9
4.7
2.3
0.4
0.0
1.1
0.9
0.0
1.2
6.7
1.5
3.3
4.0
3.3
2.1
4.0
15.9
4.4
14.1
13.8
10.7
3.5
11.5
21.1
5.6
10.3
8.5
6.2
7.9
10.7
24.6
6.8
12.0
17.9
13.1
7.3
16.9
Idaho
Boise ...........................
1.5
1.8
1.6
5.2
6.3
8.3
Nevada
Reno
0.3
0.1
1.2
5.6
2.9
6.2
Utah
Salt Lake City
2.2
1.1
1.5
5.8
8.7
9.3
W ashington
Seattle ......................
Spokane ...................
1.3
0.3
1.7
0.7
3.9
1.8
35.2
12.7
27.1
7.9
24.6
10.7
O regon
Baker ........................
Portland ...................
Roseburg .................
0.6
1.4
1.2
1.5
4.0
2.3
1.2
5.6
4.6
5.8
35.8
13.6
5.9
33.2
21.3
7.7
31.7
24.1
...........................
Early spring plantings of truck crops in California were materially benefited by rains and
warm weather in February and March, and
most crops were in good condition on March 15.
Receipts of butter at Pacific Coast markets
M a rc h , 1934
M O N T H L Y REVIEW OF BUSINESS CONDITIONS
18
declined during February and storage holdings
continued to be reduced. The price of butter
remained steady during the first half of March
after fluctuating slightly during February. Not
withstanding a decrease in receipts of eggs dur
ing February, prices of eggs declined and in
March were the same as a year ago.
Grazing conditions were good in most sec
tions of the district during February, and ex
pense for supplemental feeding of livestock
was comparatively light. Losses of stock re
mained small. Cattle and calves continued to
gain in most parts of the district during Febru
ary and are now in good condition. Marketing
of cattle was more active in February than a
year ago. Cattle quotations at district markets
advanced during February and are currently
about 14 per cent above the low levels of
March, 1933.
C O N D IT IO N OF R A N G E S, C A T T L E , A N D SH EEP
Twelfth District
(in per cent of normal)
RANGES
,-----March 1 — >
10-Yr.
1933 1934 A v .
Arizona ............ 85
75
84
California ------ 55
86
78
Idaho ................. 85
89
89
Nevada . . . . . . 88
85
85
95
85
Oregon ............ 71
Utah ................. 85
79
83
W ashington . . 81
90
85
CATTLE
SH EEP
March 1 ------^--f— March 1------ \
10-Yr.
10-Yr.
1933 1934 A v .
1933 1934 A v .
83
78
85
85
90
89
72
84
84
75
90
86
89
89
92
89
91
93
96
93
90
91
94
89
85
91
90
80
94
91
91
89
89
90
89
89
85
87
88
86
91
92
t—
Reflecting in part unusually light winter
losses, the early spring lamb crop is larger than
in 1933, notwithstanding a decrease in the num
ber of sheep on district ranges between Janu
ary 1 , 1933, and January 1, 1934. Spring lambs
throughout the entire district have developed
more rapidly than last year and shipments to
markets are expected to begin earlier than in
1933. W ith higher lamb prices now in effect
and with wool quotations above those of a year
ago (when wool sold at double the prices re
ceived in 1932) sheep growers are in a relatively
favorable position.
Agricultural Marketing ActivityCarlot Shipments
Apples and Pears.
Citrus F r u i t s . . ..
Vegetable's ............
t-------- F ebruary--------- \
1934
1933
3,266
3,518
3,682
4,468
7,924
6,851
f— Season to D ate— \
1934
1933
29,568
34,672
17,043
18,746
45,827
39,557
Exports
W heat (bu.)
Barley (,bu.)
10,477,524
4,065,821
2,7 43,934
460,178
833
568,874
Receipts
Cattle ......................
H o g s ........................
Sheep ......................
E g gs (c a s e s ). . . .
Butter (lbs.) . . . .
W heat (carlots) . .
Barley ( c a r lo t s )..
....
....
84,359
251,201
169,685
148,203
5,418,278
5,580
489
60,475
246,910
189,116
123.082
5,060,062
1,984
366
Storage Holdings
(end of month)
W heat (bu.) . . . .
Beans (bags) . . .
Butter (lbs.) . . .
E g gs (cases) . . .
t— -------1934--------------N
Feb.
Jan.
5.962.000
5,927,000
1.596.000
1,933,000
3.530.000
6,067,000
30,000
3,000
2,047,975
5,469,120
181,808
136,585
582,437
550,263
423,999
426,585
308,751
245,899
10,996,145 10,861,836
40,657
31.356
4,472
4,791
-1933Feb.
Jan.
2.563.000
2.891.000
1.432.000
1.651.000
354,000
663,000
29,000
8,000
FEDERAL RESERVE AG EN T AT SAN FRANCISCO
M arch , 1934
Industry
Twelfth District industry was seasonally
more active in February than in January. Gains
over a year ago were especially marked, since
production was near the lowest level of the
depression in February, 1933. Further improve
ment in industrial employment was reported
from most parts of the district.
Following seasonal reductions in the four
preceding months, the number employed in
California and Oregon industries increased 3
per cent during February, compared with the
usual seasonal increase of about 1 per cent.
Forces were enlarged in practically all impor
tant industries except the foods group, which
showed a small decline. As in other recent
months, there was a considerable growth in the
number employed in the manufacture of bev
erages. Employment in the textile industry
turned upward sharply during February, while
the usual slight increase was reported for lum
bering. In California the number of employees
at automobile tire factories increased sharply,
and motion picture producers also made large
additions to their forces. Manufacture of struc
tural iron and steel and of automobiles (prin
cipally assembling) continued to require more
than twice as many employees in California as
at this time a year ago. Total industrial em
ployment in both states was 27 per cent higher
than in February, 1933.
Industrial wage payments in California in
creased more than seasonally during February
and were 30 per cent larger than in Febru
ary, 1933. In Oregon, payrolls were more than
50 per cent above those of February last
year, reflecting largely an increase in lumber
19
payrolls to nearly double those of a year ago.
Average weekly earnings per worker continued
to advance in both states.
Daily average crude oil production in Cali
fornia, at 450,000 barrels during February, was
slightly lower than in January. Although au
thorized schedules were increased from a daily
average of 437,600 barrels in February to
PER CEN T
C R U D E A N D R E F IN E D O IL P R O D U C T IO N — California
Index numbers, without adjustment for seasonal variation.
(1923-1925 average= 100).
453,900 barrels in March, actual daily output
during the first half of the later month averaged
477,000 barrels. In some fields, operators have
more recently followed the practice of produc
ing the bulk of their allotment early in the
month. For this reason, output has tended to
decline during the latter part of each month
since August, 1933. Activity at refineries
changed little in the six-week period ending in
mid-March, but gasoline inventories increased
somewhat. Gasoline prices were reduced
sharply throughout the Pacific Coast states dur
ing March. Crude and fuel oil in storage declined
further during February to the lowest volume
since January, 1929.
Employment—
Industries
Stone, Clay, and
Class Products.
r----------California----------f------------------ Oregon------------N o. of
N o. of
N o. ^-Employees—'
N o.
^— Employees —*
of
Feb.,
Feb.,
of
Feb..
Feb.,
Firms 1934
1933
Firms
1934
1933
113,400
116
15,925
12,550
(+26.6)
( + 2 6 .9 )
57
Lum ber and W o o d
Manufactures . . 126
T e x t i l e s ....................
11
Clothing, Millinery,
and Laundering 137
5,128
( + 37.6)
3,726
3
45
( + 125.0)
20
13,820
( + 30.4)
1,131
( + 22.0)
10,602
41
7
8,037
( + 32.0)
1,604
( + 43.2)
6,088
927
9,584
( + 7.7)
8,900
31,540
( + 22.6)
Public Utilities . .
48 43,611
(— 2.1)
Other In d u stries!. 487 69,391
( + 23.3)
Miscellaneous . . . 49
12,970
( + 78.7)
W holesale and
Retail ................. 224 29,472
( + 1 2 .0 )
25,729
Food, Beverages,
and T o b a c c o ...
285
5$
32
1,120
119
(— 7.0)
128
1,308
( + 1 7 .9 )
1,109
4,812
( + 17.8)
4,085
44,548
56,256
7,260
28
26,309
* Public utilities and wholesale and retail figures not included in
this total, f Includes the following industries: M etals, m a
chinery, and conveyances ; leather and rubber goods ; oils and
paints ; printing and paper goods. ^Laundering only.
Figures in parentheses indicate percentage change from February,
1933.
Industry —
Indexes of daily average production, adjusted for seasonal variations
(
daily average=
)
1923-1925
100
-1934-1933Feb. Jan. Dec. N ov.
General
Carloadings— Industrial.
49
48
42
55
Elee. Power Production 145 If 144
141
143
Manufactures
52
53
46
48
Refined Mineral O ilsf . . 107
107
116
129
89
84
99TT 99
Slaughter of Livestock. 111
113
106
107
75
85
Cement ...............................
67
85
W o o l C on su m p tion !. . . 10311 94
95
93
Minerals
Petroleum (C a liforn ia)f
68
69
72
70
Lead (United States) %.
64
64
67
71
Silver (United States) j .
37
29
33
Building and Construction§
33
33
37
38
Building Permits— Value
Larger C ities.................
10
9
11
12
Smaller Cities ............
14
11
11
12
Engineering Contracts
Awarded— V alue
69
Total ...........................
73
71
75
Excluding Buildings 145
127 125
131
r - 1933-1932 — *
Feb.. Jan. Dec.
30
36
36
138
137
135
29
115
80
103
40
122
35
122
74
102
37
96
32
129
81
103
42
87
71
40
30
71
45
36
71
39
30
47
64
44
10
12
10
12
9
15
93
230
145
281
87
162
|Not adjusted for seasonal variations. {Prepared by Federal Re
serve Board. § Indexes are for three months Ending with the
month indicated. ^Preliminary.
M a rc h , 1934
M O N T H L Y REVIEW OF BUSINESS CONDITIONS
20
Lumber production increased by about the
seasonal amount during February, and was
nearly twice as large as in February, 1933. As
is usual at this time of year, when lumbering
is relatively inactive, both shipments and new
orders exceeded production, and inventories
declined.
Trade
Sales of district department stores were
cent larger in February than in January,
after seasonal allowance. Adjusted indexes for
Los Angeles, Seattle, and Salt Lake City in
creased substantially while changes in other
cities approximated the customary seasonal
movements. In comparison with February,
1933, value of sales of all reporting depart
ment stores increased 14 per cent. The number
of sales transactions was 2 per cent higher than
last year, the same increase as in January.
Value of department store inventories con
tinued the gradual decrease begun last De
cember. Fairchild’s index of retail prices of
department store goods increased from 89
(January, 1931 = 100) on February 1, to 90 on
March 1. On March 1, 1933, the index was 70.
6 per
R E T A I L T R A D E — Twelfth District
Percentage changes in value of sales and stocks
L U M B E R P R O D U C T I O N —Twelfth District
Index adjusted for seasonal variation (1923-1925 average=100).
Contracts awarded for engineering construc
tion increased from 12 million dollars in Janu
ary to 19 million dollars in February, the
largest monthly total since last June. There
was a sharp increase in awards for waterworks
as additional contracts on the Metropolitan
W ater District of Southern California amount
ing to nearly 5 million dollars were let, but most
other types of public works showed some de
cline from the preceding month. Under the
impetus of a contract awarded for a three mil
lion dollar housing project in San Francisco to
be financed by the Federal Emergency Housing
Corporation, prospective building increased
sharply. Exclusive of this large contract, resi
dential, commercial, and industrial building
aggregated somewhat higher in February than
in January.
Distribution and Trade —
Carloadingst
T o t a l ......................
Merchandise . . .
Inter coastal Trade
T o t a l ......................
W estbound . . . .
Eastbound . . . .
-1933-19321934-1933
Jan.
Feb.
Jan. D ec. N ov.
Feb.
Dec.
Indexes adjusted for seasonal variations
(1923-1925 average=100)
66
78
67
80
64
81
68
82
50
64
54
67
54
68
91
71
99
72
73
69
83
69
89
85
77
85
58
58
59
51
56
48
56
58
56
36
31
87
47
44
80
60
56
99
33
32
40
39
37
61
35
32
62
68
65
77
65
60
61
68
61
42.7
15.9
ì
41.6
12.5
Retail Trade
Automobile Salesî
541Î
T o t a l .................
Passenger . . .
5011
Commercial . . 10311
Department Store
Salesî ...............
72
64
Stocks§ ............
C ollection s#
r
Regular . . .
43.6
In stallm en t.
16.9
46.9
18.1
65
64
69
58
A . * «• .
Actual Figures
39.0
44.5
44.8
15.6
16.0
13.4
$Daily average. § A t end of month. # P e r cent of collections dur
ing month to amount outstanding at first of month. flPreliminary.
Department Stores . .
L os Angeles ............
Other So. California
Oakland ....................
San F r a n c is c o ..........
B ay R e g i o n ...............
Central C aliforn ia..
Portlandf .................
Seattle ........................
Spokane ......................
Salt Lake C ity ..........
Apparel Stores ..........
Furniture Stores..........
A ll S tores ......................
(-------------- 1934 compared with 1933--------------^
f--------- N E T S A L E S ----------^ST O C K S
Jan. 1 to end
February
of February February
14.4 ( 65)
15.9 ( 65)
10.1 (49)
12.1 (
7)
14.9 ( 7)
13.9 ( 7)
6.1 (
6)
8 .1 (
6)
9 .4 ( 4 )
4.8 ( 4)
7 .3 (
4)
1.9 ( 4 )
9.9 ( 7 )
14.9 ( 7 )
12 .9 ( 7 )
8.9 ( 15)
13.2 ( 15)
9.8 (15)
17.8 ( 6 )
19.1 ( 6 )
9 .4 ( 6 )
17.3 ( 7)
17.4 ( 7)
1.6 ( 6 )
28.2 ( 4)
15.1 ( 4 )
4 .6 ( 4 )
37.9 ( 4)
37.9 ( 4 ) — 5.2 ( 4 )
27.8 ( 4)
25.4 ( 4 )
33 .9 ( 3 )
20.0 ( 30)
26.7 ( 30)
27.6 (17)
27.5 ( 32)
26.7 ( 31)
9.3 (24)
16.2 (127)
17.8 (126)
11 .2 (90)
tIncludes five apparel stores which are not included in district
department store total.
Figures in parentheses indicate number of stores reporting.
Registrations of new automobiles— especially
of passenger cars— increased sharply during
February, more than making up for the poor
showing in January. Commercial vehicles also
participated in the rise, continuing the expan
sion begun last month. Total registrations were
64 per cent larger than in February of last year.
W H O L E S A L E T R A D E —Twelfth District
Percentage changes in value of sales
Agricultural I m p le m e n t s ..........
Autom obile S u p p lie s ....................
D rugs ...................................................
D ry G o o d s .........................................
Electrical S u p p lie s ........................
Furniture ...........................................
Groceries ...........................................
H ardw are .........................................
Shoes ...................................................
Paper and Stationery...................
A ll Lines ...........................................
February, 1934
t— compared with —n
Jan., 1934 Feb., 1933
90.4
246.3
10.0
2 2 .3
— 10.7
36.3
— 3.3
46.3
7.5
59.0
23.8
103.5
— 11 .2
29.9
1.3
58.8
31.8
63.9
— 14.1
4 3 .3
— 3.8
45.4
Cumulative
1934
compared
with 1933
186.6
17.8
34.6
35.0
50.9
82.7
27.6
57.7
56.7
41.1
39.8
A 4 per cent decline in value of wholesale
trade during February was about equal to the
usual seasonal decrease in that month. Value
of sales was 45 per cent larger than in Febru
ary, 1933, much the largest year-to-year in
crease in wholesale trade since early in 1920.
Although price advances since February, 1933,
M arch , 1934
FEDERAL RESERVE AG EN T A T SAN FRANCISCO
made up part of this extraordinary increase,
volume of goods distributed was substantially
larger than a year ago. Wholesale trade ac
tivity was at the lowest level of the depression
in February, 1933.
A larger than seasonal increase in industrial
carloadings during February offset a small de
crease in merchandise and miscellaneous traffic
with the result that total loadings of freight did
not change. The number of cars loaded was
33 per cent higher than in February, 1933, when
total freight movement was only 50 per cent of
the 1923-1925 average.
A sharp contra-seasonal rise in intercoastal
traffic during February was entirely the result
of increased shipments from the Pacific to the
Atlantic Coast. Eastbound petroleum ship
ments increased markedly during February, al
most equalling the total for July, 1930, when
they were larger than in any month since Octo
ber, 1927. Lumber shipments increased by a
small amount, while other eastbound cargo did
not change during the month.
Value of the district’s foreign trade totaled
about the same in 1933 as in 1932. Both imports
and exports reached a low point during the first
quarter of 1933, following which a considerable
improvement was recorded.
Prices
After declining in the last half of February,
wholesale commodity prices resumed their up
ward movement and in mid-March were higher
Bank Debits*—
Arizona
Phoenix ............ $
California
Bakersfield . . . .
B e r k e le y ............
F r e s n o .................
L o n g Beach . . .
Los Angeles . . . .
Oakland ............
Pasadena ..........
Sacramento . . .
San Bernardino.
San Diego . . . .
San Francisco . .
San J o s e ............
Santa Barbara .
Stockton ..........
Idaho
Boise .................
Nevada
Reno ...................
O regon
Eugene ..............
Portland ............
U tah
O g d e n .................
Salt Lake City.
W ashin gton
Bellingham . . .
Everett ...............
S e a t t le .................
Spokane ............
Tacom a ............
W alla W alla . .
Y a k i m a ..............
February
1934
21,564
February
1933
$
14,464
7,641
20,326
15,578
19,811
506,600
141,781
17,884
35,247
4,832
27,027
589,820
13,223
6,905
11,428
5,747
11,048
10,578
20,237
488,080
150,686
18,697
30,375
5,716
26,374
562,297
11,335
6,067
8,814
16,786
44,173
33,081
42,443
1,052,159
292,914
36,915
63,293
10,471
58,692
1,311,411
28,736
15,491
24,878
12,259
23,273
23,752
42,952
996,294
339,787
37,715
67,692
11,257
57,718
1,165,239
24,985
14,227
19,454
9,129
7,105
20,632
16,610
4,994
3,635
11,115
7,800
$
First two months
1934
1933
44,473
$
31,775
2,966
100,543
2,302
76,191
6,208
207,538
4,913
157,810
7,480
37,595
5,687
30,267
19,309
84,147
13,663
75,101
3,658
4,052
109,809
21,002
18,178
3,998
7,942
3,127
3,223
90,878
18,565
13,723
2,118
5,525
8,026
8,841
239,277
45,891
38,821
7,391
17,351
6,723
7,463
191,986
39,797
29,633
5,251
11,403
Total ......... .$1,771,013
$1,632,861
$3,7 90,463
$3,436,532
* I n thousands of dollars,
21
than in mid-February, when they had been
higher than at any time since April, 1931. The
recent increase is attributable chiefly to ad
vances in prices in the farm products and foods
groups. Retail food prices increased in most
cities of the district during this period.
R E T A I L F O O D P R IC E S -T w e lfth District
Expressed as percentages of average prices in 1926
1929 (12 m o s .) . . . .
1933
January ..........
February
Salt Lake
San
Francisco
City
100
100
Los
Angeles
100
Portland
102
63
59
60
58
59
61
64
69
70
70
69
66
64
61
61
60
63
64
68
68
69
68
67
67
61
58
58
59
61
65
68
68
67
67
68
67
67
64
64
64
66
67
70
72
72
72
72
70
64
61
61
63
66
68
70
71
71
70
70
69
63
62
67
69
67
69
70
72
69
71
June .................
July .................
A u gu st ..........
September
October ..........
Novem ber
Decem ber
1934
January 3 0 . , .
February 27. .
Seattle
102
Prices of most agricultural products of importance in the Twelfth District remained comparatively stable during the period under re
view. W heat prices in Portland increased
slightly during March, while oat and barley
prices declined. Quotations on alfalfa hay and
potatoes were lower in mid-March than a
month earlier. Prices of other field crops, such
as cotton, rice, and beans remained steady.
On March 1, increases were announced in
prices of some grades of canned pineapple.
Other canned fruit prices remained unchanged.
Prices of dried prunes and apricots advanced
during February and early March.
W H O L E S A L E C O M M O D I T Y P R IC E S
Expressed as percentages of prices in March, 1926
March,
1929
80
113
, .
51
109
Cotton
Lim a B ea n s..............
124
140
Cattle .
135
Lam bs
W ool
. . . 103
E ggs . .
. . 94
Butter
105
Apples
. 114
Prunes
, . 101
Flour .
Canned
. . 77
Canned
..
75
W h ea t
Barley
,, .
Copper
Silver .
.
Coffee
Rubber
,
.
153
86
88
107
March,
1933
32
45
32
33
38
58
43
39
60
45
47
50
49
50
38
78
37
42
37
41
5
July,
1933
47
83
45
55
60
69
38
62
73
59
78
64
80
55
45
88
65
59
53
40
12
Feb. 20, M arch20,
1934
1934
47
48
63
56
53
53
64
64
53
56
63
66
67
70
80
80
66
58
57
57
101
99
75
81
77
77
64
64
44
45
84
84
58
58
71
69
47
47
51
51
18
19
The spot price of foreign silver at New York
declined in mid-March, but the change did not
alter the United States Treasury’s price of 64 y 2
cents per ounce for newly mined domestic
silver. Other non-ferrous metals prices re
mained stationary during the last half of
February and the first half of March.
Prices of building materials in the district
showed little change during February.
M O N T H L Y REVIEW OF BUSINESS CONDITIONS
22
T h e C r e d it S itu a tio n
During February and the first three weeks
of March, member bank reserves fluctuated
around the highest levels on record and were
far in excess of legal requirements. In addition
to maintaining extraordinary reserves, banks
built up their balances with correspondents in
eastern cities during this period.
The principal source of additional banking
reserves continued to be the United States Gov
ernment, which disbursed 36 million dollars
more than it collected in this area between
February 21 and March 21. These Government
funds were either deposited directly in banks
by those individuals and business houses to
whom they were disbursed or entered the bank
ing structure promptly in the form of deposits
to the credit of others after having been spent
by the original recipients. The amount of re
serves thus gained by banks was more than
offset by transfers of funds out of this district.
A substantial portion of such transfers repre
sented surplus funds which were used to buy
United States Government securities and to
build up bankers’ balances in eastern cities.
Due to the existing large volume of excess
reserves, member banks have been using but a
negligible amount of reserve bank credit. This
has been true most of the time since last August,
even when inter-district transactions or Treas
ury operations at times have resulted in sizable
reductions in available banking funds. On the
other hand, gains in banking reserves during
this period have not appreciably decreased re
serve bank credit in use locally, since its total
S O U R C E S A N D U SE S O F B A N K I N G R E S E R V E S
Twelfth District
Changes in millions of dollars during the weeks indicated
SO U RC ES OF F U N D S
W eek
Ending
1934
January 1 7 ..
January 24. ,
January 31. ,
February 7. .
February 14. .
February 21, .
February 2 8 ..
M arch
7. . . .
M arch 14. . . .
March 2 1 ,
Reserve
Treas. and
Bank Commercial N at’IBank
Credit Operations Currency
— 1.7
— 3.5
+
.2
— 1.5
— 11.1
+
.8
— 1.4
—
.3
4- 4.2
+ 26.3
—
.5
— 1.8
*
— 3.2
+
-5
— 1.2
— 13.3
—
.4
— 16.2
+
.6
+
.1
— 1.2
— 2.3
+
-2
—
.8
— 6.8
—
.5
— 1.2
— 15.8
+ 1.3
Total
Supply
— 5.0
— 11.8
+ 2.5
+ 24.0
— 2.7
— 14.9
— 15.5
— 3.3
— 8.1
— 15.7
January
17. .
January
24. .
January
3 1 ..
February 7 . . ,
February 1 4 ..,
February 2 1 . .
February 2 8 ...
M arch 7 , .
March 1 4 ..........
March 2 1 . . . .
Demand
for
Currency
— 6.2
— 6.9
— 1.0
+ 4.8
—
.4
— 1.2
+ 1.6
-1- 2.5
— 4.3
— 2.2
Member
Bank
Reserve
Deposits
+ 4.6
— 8.4
— 1.9
+ 9.9
+ 8.1
— 6.7
— 12.2
+ 8.2
+ 1 0 .4
— 9.5
*Change less than $50,000.
Treasury
Cash and
Deposits
at F .R .B .
— 1.1
+ 2.6
+ 4.5
+ 9.0
— 9.0
— 8.2
— 5.4
— 15.0
— 14.2
— 1.1
has been so small that its complete elimi
nation would have had little effect on banking
reserves. Since August, 1933, therefore, the level
of Twelfth District bank reserves has depended
almost entirely upon United States Treasury
operations, transfers of funds to or from other
districts, and changes in local demand for curM IL L IO N S OF D O L L A R S
M E M B E R B A N K R E S E R V E S —Twelfth District
(Monthly averages of daily amounts. March figures preliminary.)
rency. The first two of these three factors
have been of predominant importance during
the past six months. During the four weeks
after Christmas, however, the return of cur
rency from circulation, amounting to about 26
million dollars contributed materially to the
building up of reserves.
F E D E R A L R ESER VE B A N K O F S A N F R A N C IS C O
(in millions of dollars)
(-------------------- Condition--------------------Mar. 21, Mar. 14, Feb. 21, M ar. 22,
1933
1934
1934
1934
172
177
253
170
Total Bills and Securities............
78
1
2
1
Bills Discounted ........................
50
9
5
3
Bills Bought ...............................
125
166
166
166
United States Securities..........
229
279
271
267
Total Reserves ..................................
164
221
218
Total Deposits ..................................
209
Federal Reserve Note's in
293
199
197
196
C irc u la tio n .......................................
Federal Reserve Bank Notes in
10
13
C irc u la tio n ......................................
9
Ratio of Total Reserves to D e
posit and
Federal
Reserve
50.2
65.4
65.8
Note Liabilities C o m b in e d ...
66.6
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)
USES O F F U N D S
W eek
Ending
1934
M a r c h , 1934
Other
F .R .B .
Accounts
— 2.3
+
-9
+
.9
+
.3
— 1.4
+ 1.2
+
.5
+ 1.0
*
—
2.9
Total
Demand
— 5.0
— 11.8
+ 2.5
+ 24.0
— 2.7
— 14.9
— 15.5
— 3.3
— 8.1
— 15.7
Loans and Investm ents— T o ta l.
Loans— Total ...............................
On Securities ..........................
A ll Other ....................................
Investments— Total ...................
United States S e cu ritie s.. . .
Other Securities ......................
Reserve with Reserve B a n k . . . .
N et Demand D eposits...................
Tim e Deposits ..................................
D ue from B a n k s ...............................
D ue to Banks ....................................
Borrowings at Reserve Bank. . . .
— Condition------A
M ar. 21, M ar. 14, Feb. 21, M ar 22,
1934
1934
1934
1933
1,654
1,780
1,766
1,760
881
883
916
883
220
219
218
220
696
663
663
664
738
899
883
877
560
413
570
556
329
327
317
325
82
109
114
107
605
603
600
507
872
900
901
886
118
173
192
162
135
172
171
156
1
66
FEDERAL RESERVE AG EN T AT SAN FRANCISCO
M arch , 1934
Loans of Twelfth District banks showed
practically no change during the four weeks
ending March 21. Time deposits reported by
city banks increased 15 million dollars be
tween February 21 and March 7. This is in
accordance with the movement shown in sav
ings deposits of all the important savings insti
tutions in the seven leading cities of the district,
which increased 18 million dollars between the
end of January and the end of February. Net
demand deposits increased moderately during
M ILLIO N S O F D O L L A R S
23
remained near the highest level on record.
As measured by Federal reserve note clear
ings, more currency is ordinarily carried from
the Twelfth District than is carried into it by
travelers. During the past seven weeks, how
ever, 6 y 2 million dollars of Federal reserve
notes of other banks have been returned by the
Federal Reserve Bank of San Francisco to
issuing banks, while other reserve banks have
returned only ZJ
/ 2 million dollars of local notes
to San Francisco.
M ILLION S OF
D O LL A R S
S A V I N G S D E P O S IT S —Twelfth District
Principal banks in seven larger cities (end of month figures).
the first half of March. Government deposits in
commercial banks of the district were the
highest on record during March.
Government financing of March 15 was re
stricted entirely to exchanges for maturing
issues. The amount of exchanges in this area
was small, however, since local banks seldom
hold a large percentage of their Government
securities until maturity but sell them for cash
outside the district. Holdings of previously
allotted United States Government securities
C U R R E N C Y C I R C U L A T I O N — Twelfth District
(Changes cumulated from January 2, 1929.) Monthly averages.
Latest figure is an average of first 21 days in March.
During January and February, 11 unlicensed
Twelfth District banks were placed in liquida
tion. Several others were consolidated with
licensed banks and 10 institutions were author
ized to resume operations on an unrestricted
basis. As a result of these changes, the number
of unlicensed banks had been reduced to 40 at
the end of February.
S U M M A R Y O F N A T IO N A L C O N D IT IO N S
Prepared by the Federal Reserve Board
Volume of industrial activity increased in
February for the third consecutive month and
there was a considerable growth in factory em
ployment and payrolls. Wholesale commodity
prices, after advancing for two months, showed
little change between the middle of February
and the middle of March.
Production and Employment. Output of
manufactures and minerals, as measured by the
Board’s seasonally adjusted index of industrial
production, increased from 78 per cent of the
1923-1925 average in January to 81 per cent in
February. The advance reflected chiefly in
creases of considerably more than the usual
seasonal amount in the output of steel and auto
mobiles, while activity at meat packing estab
lishments declined. Activity at textile mills,
which in January had increased from the low
level prevailing at the end of the year, showed a
further moderate increase in February, partly
of seasonal character. In the first week of
March, steel production showed a further in
crease and in the following two weeks remained
unchanged.
Factory employment and payrolls increased
substantially between the middle of January
and the middle of February to a level higher, on
a seasonally adjusted basis, than at any other
time since the summer of 1931. Working forces
on railroads also showed an increase, while at
mines there was little change in the volume of
employment. The number on the payrolls of
the Civil Works Administration declined from
about 4,000,000 in January to about 2,900,000 in
the week ending March 1. A t automobile fac
tories there was a large increase in the number
employed to approximately the level prevailing
four years ago. Substantial increases were re
24
M O N T H L Y REVIEW OF BUSINESS CONDITIONS
ported also for the textile, clothing, shoe, and
tobacco industries.
Value of construction contracts awarded, as
reported by the F. W . Dodge Corporation,
showed a decline in February, followed by an
increase in the first half of March. The total
volume indicated for the first quarter is some
what smaller than in the last quarter of 1933
but considerably larger than in the first quarters
of 1932 and 1933.
1929
1930
1931
1932
1933
1934
I N D U S T R I A L P R O D U C T IO N
M a rc h , 1934
Bank Credit. Between the middle of Febru
ary and the third week of March, imports of
gold from abroad resulted in a growth of about
$550,000,000 in the country’s monetary gold
stock. Funds arising from these imports of
gold and from expenditure by the Treasury of
about $140,000,000 of its cash and deposits with
the Federal reserve banks were for the most
part added to the reserves of member banks,
which consequently increased by $600,000,000
1929
1930
1931
1932
1933
1934
FA C T O R Y EM P LO YM E N T A N D PAYROLLS
Index numbers of industrial production, adjusted for seasonal varia
tion (1923-1925 average=100).
Distribution. Freight traffic increased season
ally during February and the early part of
March. Dollar volume of department store
sales on a daily average basis showed little
change in February.
Dollar Exchange. The foreign exchange
value of the dollar in relation to gold currencies
declined in the second week of February to
within two per cent of its new parity and in
the latter part of February and the first three
weeks of March showed a further slight decline.
Indexes of factory employment and payrolls, without adjustment for
seasonal variation (1923-1925 average=100).
during the four-week period. A t the close of
the period member bank reserves were nearly
$1,500,000,000 in excess of legal requirements.
Total deposits of reporting member banks in
creased by about $ 1 ,000,000,000 between the
middle of February and the middle of March,
reflecting the imports of gold, purchases by the
banks of United States Government and other
securities, and a growth of bankers’ balances.
During March, open market money rates
declined further. Rates on 90-day bankers’ ac6 ILL IONS OF DOLLARS
1929
1930
1931
1932
1933
1934
W H O L E S A L E P R IC E S
Indexes of the United States Bureau of Labor Statistics.
By months 1929 to 1931; by weeks 1932 to date. (1926=100.)
Latest figure is for week ending March 17.
Commodity Prices. Wholesale prices of commodities showed little change from the middle
of February to the middle of March, after a
considerable increase earlier in the year. The
index of the Bureau of Labor Statistics for the
week ending March 17 was 73.7 (1926 average
= 100) compared with 73.8 the week before
and 72.4 at the end of January.
1932
1933
1934
M E M B E R B A N K C R E D IT
Wednesday figures for reporting member banks in 90 leading cities.
Latest figures are for March 14.
ceptances were reduced from
per cent to
per cent, and rates on prime commercial paper
were reduced by
percent to a range of l - l } i
per cent. Yields on United States Government
securities also declined considerably.
On
March 16, the Federal Reserve Bank of Minneapolis reduced its discount rate from 3 ^ to 3
per cent.
@FedFRASER