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M

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BUSINESS CONDITIONS
ISAAC B. NEWTON, Chairman of the Board and Federal Reserve Agent
Federal Reserve Bank of San Francisco
Vol. XII

San Francisco, California, October 20,1928

No. 10

SU M M ARY OF N A T IO N A L CONDITIONS
Prepared by the Federal Reserve Board
Volume of production and distribution of
commodities increased seasonally in September
and was larger than a year ago. There was a
further advance in the general price level.
Loans of member banks in leading cities in­
creased in September and October in response
to the seasonal demand for commercial credit.
Production. Industrial production increased
further in September and the output of manu­
factures was in larger volume than in any pre­
vious month. Factory employment and pay­
rolls also increased. Production of iron and
steel and of automobiles was unusually large
during September and October, although there
has recently been some curtailment of opera­
tions in these industries. There were also in­
creases in September in the activity of the tex­
tile, meat packing, and tire industries and in
the output of coal, petroleum, and copper, while
lumber production showed a decline. Building
contracts awarded, after declining in volume
for three months increased considerably in Sep­
PER C E N T

tember and exceeded all previous records for
that month. The increase was due chiefly to
certain large contracts for industrial plants and
subway construction. During the first three
weeks of October awards exceeded those for
the same period last year, the excess being espe­
cially large in the eastern district.
United States Department of Agriculture
estimates of this year’s crop yields indicate that
the production of all crops in the aggregate will
exceed last year’s output by about 5 per cent.
The corn crop is estimated at 2,903,000,000
bushels, or 5 per cent above last year’s pro­
duction. The October 8 estimate indicated a
cotton crop of 13,993,000 bales, or 446,000 bales
less than was forecast on September 8, com­
pared with a yield of 12,955,000 in 1927.
Trade. Department store sales increased con­
siderably in September and were larger than a
year ago, reflecting, in part, the influence of
cooler weather. Inventories of department
stores at the end of the month were smaller
PER C E N T

I N D U S T R I A L P R O D U C T IO N

W H O L E S A L E PR IC E S

Index number of manufactures and minerals combined, adjusted
for seasonal variations (1923-1925 average = 100).
Latest figure, September, 114.

Index of United States Bureau of Labor Statistics (1926 prices =«100,
base adopted by Bureau). Latest figure, September, 100.1.

Requests for early numbers of this Review have been received from universities and libraries whose files
of the publication are incomplete. It would be appreciated if those readers who have available copies of the
Review for months prior to January, 1923, would forward them to the Federal Reserve Agent, Federal Re­
serve Bank, San Francisco.




74

M O N T H L Y R EVIEW OF BUSINESS CONDITIONS

than on the same date of last year. Wholesale
distribution in all leading lines, except meats,
was somewhat smaller than in September, 1927.
Freight carloadings showed more than a sea­
sonal increase in September and continued
large in October. Shipments of miscellaneous
commodities in recent weeks have continued
in larger volume than in previous years.
Prices. Wholesale commodity prices in­
creased further in September and the Bureau

October, 1928

middle of September and the middle of Oc­
tober, reflecting seasonal activity in trade and
marketing of crops. There was also a growth in
loans to brokers and dealers in securities,
though total loans on securities of reporting
member banks showed little change.
During the four weeks ending on October 24,
a growth of about 40 million dollars in the total
volume of reserve bank credit in use was due
chiefly to continued increase in the demand for
B IL L IO N S O F

DOLLARS

M E M B E R B A N K C R E D IT

R ESE R V E B A N K C R E D IT

Monthly averages of weekly figures for banks in 101 leading cities.
Latest figures are averages for the first three weeks
in October.

Monthly averages of daily figures for 12 Federal Reserve Banks.
Latest figures are averages for first 17 days in
October.

of Labor Statistics’ index advanced to 100.1
per cent of the 1926 average. Increases, which
were largest in farm products and foods, oc­
curred in nearly all groups except hides and
leather and textiles, which showed slight de­
clines. Since the latter part of September, there
have been decreases in the prices of livestock
and meats, grains, wool, and hides, and in­
creases in cotton, silk, rubber, and iron and
steel.
Bank Credit. Demand for bank credit for
commercial purposes increased between the

currency, offset in part by a small inflow of gold
from abroad. Reserve bank holdings of accep­
tances increased by about 140 million dollars
during the period, while the volume of dis­
counts for member banks declined by about
100 million dollars. United States security
holdings remained practically unchanged.
Open market rates on commercial paper and
on bank acceptances remained unchanged be­
tween the middle of September and latter part
of October, while rates on security loans de­
clined during the later month.

T W E L F T H FED ER AL RESERVE DISTRICT CONDITIONS
A generally satisfactory agricultural outlook,
a large volume of trade, well sustained indus­
trial activity, and an ample supply of credit are
the chief features of the present business situa­
tion in the Twelfth Federal Reserve District.
Aggregate production of the District’s farms
and ranges during 1928 has approximated that
of a year ago, and, with the exception of a few
specialized crops, market conditions have been
satisfactory.
The livestock industry has
achieved a particularly favorable position.
The volume of trade transacted during Sep­
tember, 1928, was at seasonally high levels and
exceeded that of a year ago. Current trade con­
ditions reflect a generally satisfactory employ­
ment situation and seasonal expansion in buy­
ing power of agricultural communities.
Industrial operations, excepting building,




have been somewhat more active during recent
weeks than either one month or one year ago.
Improvement in those industries such as cop­
per mining, lumbering, and petroleum produc­
tion and refining, which have co-operatively
achieved a partial regulation of output, has been
noteworthy.
An increased demand for the ample supply of
credit available to commerce and industry was
evident during early October, although the total
volume of commercial loans extended by mem­
ber banks of the District was lower than during
early September. Total loans on securities at
these banks increased throughout September
and the first half of October, reflecting, in part,
increased activity in security markets. Dis­
counts at the Reserve Bank have decreased
since reaching a high point on September 5.

O cto b e r , 1928

Agriculture
The continued absence of autumn rains in
the Twelfth District has favored late harvest­
ing operations but has hindered both the fall
sowing of wheat and the growth of forage on
livestock ranges. Crop production estimates for
1928, made by the United States Department of
Agriculture as of October 1, tend to confirm
previous forecasts of an aggregate yield of the
District’s principal crops equal to that of 1927.
The yield per acre of wheat and barley har­
vested in the District has been slightly larger
than was anticipated earlier in the crop season
and October 1 production estimates were 3.5
per cent higher for wheat and 4.1 per cent
higher for barley than the August 1 forecast.
A decrease in exports of Pacific Northwestern
wheat during the present season has been offset
to some extent by increased domestic shipments
to midwestern states, but the proportion of the
crop marketed thus far is estimated to be lower
than the average for like periods of recent
years.
EXPORTS OF W H E A T A N D BAR LEY
— juiy i — a e p t e r a D e r o u ----------Three-Year
(1925-1927)
1928
1927
Average

respectively. The final outturn of these crops
will depend largely upon weather conditions
during the next few weeks.
Harvesting of the District’s deciduous fruit
crops, excepting apples in the Pacific Northwest
and grapes in California, is now finished. Ship­
ments of grapes from California have totaled
57,003 carloads for the season to October 22,
1928, compared with a cumulative seasonal
movement of 63,647 carloads up to October 22,
1927. On October 1, the Department of Agricul­
ture’s estimate of the 1928 grape crop in Cali­
fornia was reduced 27,000 tons from the Sep­
tember 1 forecast and now stands at 2,300,000
tons. The 1927 crop was 2,406,000 tons. Sales
of California grapes at Eastern auction markets
during the current season have brought smaller
unit returns than one year ago. Similarly, Pa­
cific Northwestern apples have sold at prices
approximately 75 cents per box lower than last
year.
A P P L E S — Twelfth District and United States
Commercial Production

(in thousands of bushels)
C a lifo r n ia ................................

r -------

W h ea t (bushels)

P uget Sound ....................
Colum bia R i v e r ................

1,683,200
7,580,971

2,348,567
15,042,101

2,130,739
9,899,532

T otal ...............................
B arley (bushels)
San F r a n c is c o ..................

9,264,171

17,390,668

12,030,271

4,408,765

5,037,336

4,529,945*

* Subject to revision.

Aggregate production of the principal field
crops grown in the District is reported to be
somewhat smaller this year than in 1927. On
the basis of the present estimates beans, pota­
toes, rice, tame hay, and sugar beets show de­
creases of 10.7, 2.0, 23.0, 6.0, and 18.4 per cent,
respectively, from one year ago, while hops and
cotton show increases of 6.7 and 48.1 per cent,
P R O D U C T I O N * -F ie ld and Grain Crops

Beans (bushels)

Preliminary
Estimate
O ct. 1,1928

Actual
1927

Five-Year
(1923-1927)
Average

5,835
15,896

6,531
16,891

5,811
17,134

277
13,993

187
12,955

199
14,160

14,770
92,688

15,712
106,219

15,144
93,153

31,810
t

29,794
f

27,462
f

49,594
. 463,722

50,602
406,964

38,393
383,526

California, I d a h o ....................
U nited States ..........................
Cotton (bales)
U nited States ..........................
H ay, Tam e (ton s)

.
H ops (p ound s)

California, O regon, W ash. .. .

Potatoes (bushels)

T w elfth D i s t r ic t ......................
Rice (bushels)

.
Sugar Beets (ton s)

California, Idaho, U ta h .........

6,901
38,833
1,252
6,758

8,960
44,339$

6,356
36,118

1,534
7,753

1,636
7,458

B arley (bushels)
40,244
41,147
T w elfth D i s t r ic t ...................... . 48,088
208,722
264,392
. 350,593
W h ea t (bushels)
110,250
133,754
T w elfth D i s t r i c t ...................... . 124,595
872,595
808,196
U nited S t a t e s .......................... . 903,865
com
m
ercial
production
of hops
* In thousands. fU n ited States
originates in California, Oregon, and Washington. JRevised.
Source: United States Department of Agriculture.




75

FEDERAL RESERVE AGENT AT SAN FRANCISCO

U t a h .........................................
W ashington ..........................
United S t a t e s ........................ . . .

Shipments (in carloads)
California ....................... .............
.............
.............
.............
W a s h in g t o n ................... .............

Forecast
Oct. 1,1928

Actual
1927

Five-Year
(1923-1927)
Average

7,083
3,771
4,284
585
30,483

4,656
5,400
2,925
402
22,302

4,972
4,005
4,363
584
24,377

46,206
100,449

35,685
77,700

38,301
97,328

June 1 — September 30-------- \
Five-Y ear
(1923-1927)
1928
1927
Average

1,670
656
190
4
3,124

2,313
846
530
54
4,622

5,644
.............
9,607
S ource : U nited States Departm ent o f A griculture.

8,365

3,366
1,099
519
57
4,566

The citrus fruit crop now on the trees in Cali­
fornia is reported to be in excellent condition
and a large yield is anticipated. Shipments of
oranges from California totaled 44,793 carloads
between November 1,1927, and October 1, 1928.
During the same period of the 1926-1927 crop
season 54,517 carloads were shipped.
Protracted dry weather in the Intermoun­
tain livestock range territory has retarded the
growth of fall and winter forage, and caused a
shortage of water in some stock raising sec­
tions. Livestock are reported to be in poorer
condition than either one month or one year
ago. Desert ranges in Idaho, Nevada, and
Utah which are used for winter grazing pur­
poses have produced a short crop of feed this
year. The supply of supplementary feed crops
(chiefly hay) grown in these areas, however,
approximates that of a year ago, except in
Idaho, where the hay crop is reported to be 12
per cent smaller in volume than in 1927.
The fall movement of cattle to the principal
livestock markets in the District has not been
so heavy as a year ago but probably represents
a larger proportion of the stock on ranges than

76

M O N T H L Y REVIEW OF BUSINESS CONDITIONS

was marketed in the fall of 1927. Cattlemen are
selling most of their marketable stock at pres­
ent profitable prices, and restocking of herds is
proceeding at a slower rate than usual.
The movement of range lambs to market has
continued heavier than in 1927. Unsatisfactory
summer feed conditions are reflected in the
large proportion of thin (feeder) lambs which
have thus far arrived at livestock markets.
Sheepraisers are reported to be retaining large
numbers of ewe lambs for breeding purposes.
Figures showing the receipts of livestock at
the principal markets in the Twelfth District
follow :

O c t o b e r , 1928

ters of 1928 has been the stability of both output
and prices in those industries which are suffi­
ciently well organized to achieve at least partial
regulation of production.
INDEX NUM BERS

L IV E S T O C K R E C E IP T S — P R I N C I P A L M A R K E T S
Twelfth District

,------------- 1928-------------> ,------------- 1927------------- *
September

Cattle ..........................
76,504
Calves ........................... 15,686
H ogs
.......................... 144,575
S h e e p ............................ 520,910

Jan. - Sept.
Inclusive September

624,281
141,638
1,889,515
3,022,978

88,863
20,205
142,762
365,302

Jan. - Sept.
Inclusive

721,450
178,132
1,575,799
2,722,140

Cattle sold on Pacific Coast markets during
September and early October have brought
higher prices than were paid either one month
or one year ago. Sheep prices at the same mar­
kets, although higher during September than
a year ago, declined slightly during October.
Hog prices declined slightly during September
but remained at higher levels than in Septem­
ber, 1927.
Industry
Industrial activity in the Twelfth Federal
Reserve District was well maintained during
September. The mining industry was particu­
larly active, being stimulated by a strong de­
mand for copper wrhich brought about a sub­
stantial increase in production of this metal.
Petroleum production was also well maintained
during the month, while lumber and flour pro­
duction increased more than seasonally. This
Bank’s seasonally adjusted index of freight carloadings of industrial commodities stood at 109
(1923-1925 daily average = 100) in September,
1928, as compared with 118 in August, 1928, and
108 in September, 1927. A salient feature of the
industrial situation during the first three quar-

(A) Industry—
Indexes of daily average production, adjusted for seasonal variation.
(1923-1925 daily average = 100)
f-----------— 1928—
1927
Aug.
July
Sept.
Sept.
M anufactures:

F lour ..........................................
Slaughter o f L i v e s t o c k .........
L um ber .....................................
Refined M ineral O i l s f ..........
Cement .......................................
W o o l C o n s u m p tio n .................

108
84*
116*
159
117

98
890
1080
161
128
75

88
89
1020
158
105
66

98
97
112
153
111
97

96
121
79

95
115
108
82

97
113
97
84

96
104
111
90

109

118

117

108

Minerals :

Petroleum (C a lifo rn ia )! . . . .
Copper (U nited S ta tes)$ . . . .
L ead (U nited States) X . . . . .
Silver (U nited States) X
General :
Carloadings§ ............................

*Preliminary. fN o t adjusted for seasonal variation. $Prepared
by Federal Reserve Board. § Other than Merchandise and
Miscellaneous. Q]RevisecL




C A R L O A D IN G S O F “ O T H E R T H A N M E R C H A N D IS E A N D
M I S C E L L A N E O U S F R E I G H T ” — T W E L F T H D IS T R I C T
Index adjusted for seasonal variation; 1923-1925 daily average = 100.
Latest figure, September, 109.

Employment increased somewhat more than
seasonally during September, although in most
instances the demand was well balanced by the
available supply. A shortage of women can­
nery workers was reported from some sections
of Oregon, and an acute shortage of cotton pick­
ers in the Salt River Valley in Arizona has re­
cently developed. Highway work and heavy
construction begun during August, and agri­
cultural operations which were being rushed to
take advantage of good weather, furnished em­
ployment to large numbers of men. During
September there was a general advance in
wages in the copper mining industry, averag­
ing approximately 10 per cent for all classes of
labor.
Lumber production increased during Sep­
tember, particularly in Washington and Ari­
zona. A firm demand from the Middle W est and
some orders for local needs, together with the
seasonal elimination of fire hazard, were the

(B ) Employment—

t

t

-Californ ia
- ^ -------- — Oregon- ...... —
N o. of
N o. of
N o.
N o.
Employees — >
Employees
of
Sept.,
Sept.,
of
Sept.,
Sept.,
1927
Industries
Firms 1928
1927 Firms
1928
31,875
All Industries........... 762 167,927 164,943
155
29,627
(7.6)
(1.8)
Stone, Clay and

<—

250
5
269
45
6,796
7,178
Glass P rod u cts.
(— 5.3)
(7.6)
L um ber and W o o d
16,826
56
17,850
Manufactures . . 117 27,518 27,910
(— 1.4)
(6 .1 )
2,148
2,353
2,690
10
1,875
18
(— 12.5)
(— 12.7)
Clothing, M illinery
and Laundering. 63
8,131
8,263
9*
484
452
( — 1.6)
(7.1)
F ood s, Beverages
4,236
43
5,874
and T o b a cco . . 166 43,722 45,474
(— 3.9)
(38.7)
W ater, L igh t, and
4
P ow er ................
3,390
3,995
(17.8)
O ther In d u stries!. 334 73,165 67,738
(8.0)
32
M iscellaneous . . . .
15
2,247
2,300
5,523
5,715
(— 2.3)
(— 3.4)
*L aunderin g only. tTncludes the follow in g industries : metals,
m achinery and co n v e y a n ce s ; leather and rubber g o o d s ;
chem icals, oils and p a in ts; printing and paper goods.
Figures in parentheses indicate percentage changes from Sep­
tem ber, 1927.

O cto b e r , 1928

77

FEDERAL RESERVE AGENT AT SAN FRANCISCO

chief factors accounting for increased activity.
This Bank’s seasonally adjusted index of lum­
ber production rose to 116 (1923-1925 daily av­
erage = 100) during September, 1928, accord­
ing to preliminary estimates. It stood at 108 in
August, 1928 (revised estimate) and 112 in
September, 1927. Shipments and orders are
again running slightly ahead of production.
Many of the orders received are highly detailed
and call for well-seasoned lumber for immediate
delivery, making it difficult for some mills to
meet buyer’s specifications.
Building activity during the first nine months
of 1928 has been at substantially lower levels
than during the same period in 1927. The total
value of building permits issued in 92 cities of
the Twelfth Federal Reserve District, as re­
ported by S. W . Straus and Company, was 11
per cent smaller than a year ago. The value of
engineering and heavy construction contracts
awarded during the first three quarters of 1928
also declined markedly as compared with the
same period in 1927. Figures reported by the
Engineering News Record for the far-western
district show a decrease of 14 per cent. Awards
of building permits and construction contracts
declined sharply during September.
Petroleum output in California during Sep­
tember, 1928, was larger than during August,
1928, and at approximately the same rate as in
September, 1927. This Bank’s index of daily
average production of petroleum stood at 96
(1923-1925 daily average == 100) in September,
1928, and September, 1927, and 95 in August,
1928. Although daily average production for
September was high, the end of the month wit­
nessed a substantial recession in production.

(C) Bank Debits*Sept.,
1928

Sept.,
19270

12,946
$
12,484 $
9,880
10,061
Bellingham
21,242
20,862
B e r k e l e y .............
14,751
17,181
B o i s e ....................
7,481
7,629
E ugene ................
13,243
13,533
Everett ...............
43,662
49,876
Fresno ...............
52,392
43,383
L o n g B each . . .
859.094
L os Angeles . . ., 1,023,494
232,593
214^163
Oakland .............
21,840
23,117
O g d e n ..................
33,813
36,888
Pasadena ...........
23,837
31,724
P hoen ix .............
181,023
185,900!
P o r t la n d ...............
10,567
11,690
R en o ..................
1,499
1,230
R itzville ...........
46,247
55,107
Sacram ento
68,707
76,215
Salt Lake C ity. .
10,033
8,499
San B ernardino.
57,415
56,487
San D i e g o .........
1,283,350
San Francisco . . 1,474,532
27,264
28,432
San Jose ...........
13,148
14,131
Santa B a rb a ra ..
240,852
239,756
S e a t t l e ...................
59,425
56,547
Spokane ...............
29,233
28,115
S tockton .............
45,835
46,731
T a com a .............
14,460
17,108
Yakim a .............
D i s t r i c t ........... $3,826,lOOf $3,414,607

t—

First Nine M onths— N
19270
1928

$

124,686 $;
116,141
90,687
87,907
190,677
195,913
134,042
119,344
67,015
66,715
114,231
121,791
343,178
306,034
439,761
489,437
8,274,011
9,459,502
1,973,467
2,203,469
155,757
162,158
363,699
363,668
239,093
304,320
1,501,103
1,582,662$
84,467
88,182
7,946
9,094
337,098
445,547
614,032
661,188
91,235
94,075
551,174
562,498
10,798,876
13,764,136
232,102
251,306
125,309
120,868
1,914,746
2,188,258
493,513
504,937
250,919
262,973
405,298
410,129
118,921
109,057

$35,091,637$ $29,996,7.15

*In thousands, !In clu d es $16,629,000 at four banks not reporting
prior to week ended M ay 2, 1928. $Includes $86,200,000 at
four banks not reporting prior to week ended M ay 2, 1928.
ORevised.




Producers have continued their program of re­
strained production so that surface stocks may
be kept at present relatively low levels during
the winter, when demand is seasonally light.
Copper production at the end of September
had reached the highest level since December,
1918, and approximated sales for the first time
in recent months. As a result, stocks of copper
on hand are estimated to have changed little
since the end of August. Orders for both for­
eign and domestic delivery were in large vol­
ume. Preliminary estimates indicate that there
was some increase in lead production during
September, and quicksilver mining in Califor­
nia and Arizona was active. Output of silver
and zinc was well below the levels of the pre­
vious month and of a year ago.
The volume of wheat ground at District flour
mills increased more than seasonally during
September. This Bank’s seasonally adjusted in­
dex of flour production advanced to 108 (19231925 daily average ==» 100) as compared with 98
in August, 1928, and September, 1927. Stocks
of flour on hand at the middle of the month were
3 per cent smaller than at the middle of Sep­
tember, 1927. Both domestic and foreign ship­
ments were reported to be somewhat larger
during the past month than in August.

Trade
Trade continued in large volume during Sep­
tember, 1928, and was larger than during Sep­
tember, 1927, despite the fact that there was one
less trading day in September of this year than
in September a year ago. The greatest increases
in trade activity were reported from Oakland,
California; Seattle, Washington; and Salt Lake
City, Utah.
Total carloadings in the District declined
during the month, contrary to the usual sea­
sonal movement, due chiefly to lighter loadings
of lumber, and merchandise and miscellaneous
freight in California, but were larger than in
September, 1927. This Bank’s seasonally ad­
justed index of merchandise and miscellaneous

(D) Distribution and Trade—
,-------------- 1928------------- \ 1927
Carloadings, T o t a l! ..........................
C arloadings, M erchandise and
M iscella n eou s! .................................
Sales at W holesale^ ..........................
Sales at R eta il! ...................................
Stocks, Retail§ .....................................
Sales of N ew Autom obiles ||
Passenger Cars ................................
Com m ercial V ehicles ....................

Sept.

Aug.

July

114

122

120

Sept.

111

118
99
123
109

124
103
1200
107

122
93
120
109

114
98
117
110

110
119

115
121

103
102

84
95

r-----------Index Numbers*----------- \

------------- Actual Figures------------- *

S tock Turnover, R e ta ilH ............................ 25
C ollections, R e ta il#
R egular .............................................
45.3
In stallment .......................................
15.8

.27
45.1
17.1

.22
45.0
15.3

.25
44.4
16.0

* A djusted fo r seasonal variations, 1923-1925 average=100. !D a ily
average. $M onthly totals o f eleven lines com bined. §A t end
o f m onth. ||For source of figures, see June, 1928 R eview .
^Proportion of average stocks sold during month. # P e r cent
o f collections during m onth to amount outstanding at first
o f month. ORevised.

78

M O N T H L Y R EVIEW OF BUSINESS CONDITIONS

freight carloadings stood at 118 (1923-1925 daily
average = 100) in September, 1928; 124 in Au­
gust, 1928; and 114 in September, 1927. The
decrease from last month in merchandise and
miscellaneous carloadings in California was the
result of decreased shipments of building mate­
rials and agricultural products other than
grains.

D IS T R I B U T I O N A N D T R A D E - T W E L F T H

D IS T R IC T

Indexes adjusted for seasonal variation. 1923-1925 average = 100. Daily
average figures of department store sales and railway carloadings
of merchandise freight. Monthly figures of sales at wholesale.

Sales at retail of 150 department, apparel, and
furniture stores were one per cent larger in
September, 1928, than in September, 1927. Dur­
ing the first three quarters of 1928, such sales
were 2 per cent larger than during the first three
quarters of 1927. The seasonally adjusted index
of daily average sales of 28 department stores
compiled by this Bank advanced to 123 (19231925 average = 100) in September, 1928, as
compared with 120 in August, 1928, and 117 in
September, 1927. Stock on hand at 27 depart­
ment stores increased more than seasonally dur­
ing September, but at the end of the month was
one per cent smaller than a year ago.
R E T A I L T R A D E —Twelfth District
,--------- N E T S A L E S *--------- N
Jan. 1 to
Sept. 30,1928,
compared with
Jan. 1 to
Sept. 30,1927

Sept., 1928,
compared
with
Sept., 1927

Departm ent S to r e s f* * .
1.4
6.4
A pparel S t o r e s .............
Furniture Stores ......... — 2.0 (
1.3
A ll S tores ......................

( 67)
2.2
( 28)
1.3
53) — 2.0 (
(150)
1.7

( 61)
( 23)
43)
(128)

ST O C K S*
Sept.,1928,
compared
with
Sept., 1927

— 2.0
— 1.8
— 6.9 (
— 2.7

( 52)
( 14)
33)
(101)

*P ercentage increase or decrease ( — ). Figures in parentheses in­
dicate num ber of stores reporting, fln clu d e s dry goods stores..

Total monthly sales of 238 firms in eleven
lines of wholesale trade decreased during Sep­
tember, contrary to the usual seasonal move­
ment, but were about 2 per cent larger than dur­
ing September a year ago. While the influence
of the number of trading days in a month upon
total sales for that month is not so great in the
case of wholesale trade as in the case of retail
trade, the absence of one trading day undoubt­
edly does affect volume of sales and, if allow­
ance were made for this factor, sales at whole­
sale during September, 1928, would probably
show a more substantial increase over sales of
a year ago than is shown by the unadjusted fig­




O cto b e r, 1928

ures. This factor probably also accounts for
part of the decrease in sales from last month.
This Bank’s seasonally adjusted index of sales
of 146 wholesale firms stood at 99 (1923-1925
monthly average = 100) in September, 1928;
103 in August, 1928; and 98 in September, 1927.
No allowance is made in this index for the vary­
ing number of trading days during different
months. Stocks held by wholesalers averaged
practically the same at the end of September
this year as a year ago. Wholesale grocers re­
port that accounts are being paid more rapidly
than a year ago, but most other lines of whole­
sale trade show collections barely equal to or
below September, 1927.
Sales of new automobiles, both passenger
cars and commercial vehicles, declined through­
out the District by more than the usual sea­
sonal amount. The seasonally adjusted index
of passenger car sales in the District stood at
110 (1923-1925 daily average = 100) in Septem­
ber, 1928; 115 in August, 1928; and 84 in Sep­
tember, 1927, and for commercial car sales at
119 in September, 1928; 121 in August, 1928;
and 95 in September, 1927.

Prices
The United States Bureau of Labor Statistics’
index of wholesale prices of 550 commodities
advanced from 98.9 (1926 monthly average =
100) in August to 100.1 during September, the
first time this index has reached 100 since June,
1926. Higher prices for farm products and for
foods were chiefly responsible for the advance
in the general index.
Wheat quotations advanced moderately in
late September and have held fairly steady since
then, although some weakening in prices was
recorded at mid-October. Prices for raw cotton
likewise advanced after the sharp drop on Sep­
tember 10 and have fluctuated within compara­
tively narrow limits since the latter part of that
month.
Livestock prices were at relatively high levels
throughout September, although their trend
was downward. Toward the close of the month
quotations for hogs declined sharply, and early
in October cattle and lamb prices moved down­
ward, but recovered most of their loss before
the middle of the month.
No change of importance has occurred in
prices of dried or canned fruits during recent
weeks. Marketing of fresh grapes was in large
volume during September and the first half of
October, but at prices considerably lower than
a year ago.
Copper and lead prices were steady during
early October following the September advance.
Zinc prices have remained unchanged, and
silver has fluctuated within narrow limits with­
out showing any definite trend.

O cto b e r , 1928

79

FEDERAL RESERVE AGENT AT SAN FRANCISCO

Banking and Credit
The banking and credit situation in the
Twelfth Federal Reserve District during Sep­
tember and the first half of October has reflected
a maintenance of activity in the general busi­
ness field. There was some reduction in the
volume of commercial loans at reporting mem­
ber banks during September, but this reduction
was partially offset by increases during the first
weeks of October. On October 17, these loans
amounted to 973 million dollars compared with
986 million dollars on September 12 and 946
million dollars on October 19, 1927. Loans on
securities at reporting banks expanded through­
out the period under review and on October 17
totaled 389 million dollars compared with 367
million dollars on September 12 and 335 mil­
lion dollars on October 19, 1927. Investment
holdings showed a net increase of 20 million
dollars during the five weeks from September
12 to October 17, of which 18 million dollars was
in United States securities, representing sub­
scriptions by the banks for United States Treas­
ury certificates issued during September and
October. Deposits of reporting member banks
MILLIONS OF DOLLARS

M E M B E R B A N K C R E D I T -T W E L F T H D IS T R I C T
Monthly averages of weekly figures. Latest figures are averages
for the first three weeks in October.

showed little net change between mid-Septem­
ber and mid-October. Their borrowings from
the Reserve Bank, over the period as a whole,
declined 22 million dollars, a reflection, in part,
of their subscriptions to United States securi­
ties, in part of an inflow of funds into the Dis-

trict, and in part of Reserve Bank purchases of
acceptances in local markets.
Changes in demand for credit at the Federal
Reserve Bank of San Francisco during this pe­
riod were the result almost wholly of changes
in amounts borrowed by city member banks,
and grew out of Treasury financing operations
and the interdistrict flow of funds. These city
member banks purchased from the Treasury
approximately 45 million dollars of United
States securities issued in mid-September and
18 million dollars issued in mid-October, giving
the United States government deposit credits
for these amounts. The United States Treasury
withdrew 45 million dollars of these deposits
during the month. In order to meet these with­
drawals the member banks disposed of approxi­
mately an equal amount of United States se­
curities. As a partial result of the disposal of
these securities there was a net inflow of funds
into the District for member bank account (in­
cluding the account of non-member clearing
banks) of 36 million dollars. Member banks
were thus able to meet the Treasury’s demands
and, aided by purchase of 7 million dollars of
acceptances by the Reserve Bank and a slight
reduction in demand for currency they were
also able to reduce their borrowings at the Re­
serve Bank by 23 million dollars, and to in­
crease their reserve balances by 2 million dol­
lars.
The effects of these movements upon the
condition of the Federal Reserve Bank of San
Francisco were as follows:
1. Total deposits (chiefly member bank bal­
ances) were increased 2 million dollars.
2. Earning assets (chiefly member bank bor­
rowings) were reduced 19 million dollars.
3. Cash and currency other than Federal re­
serve notes, amounting to 4 million dollars was
paid into circulation, and circulation of Federal
reserve notes was reduced by 5 million dollars,
the net result being a decrease of about one
million dollars in the amount of currency in
circulation in the District.
4. Cash reserves of the Federal Reserve Bank
of San Francisco increased 14 million dollars,
transfers of funds into the District from other
parts of the United States amounting to 36 mil­
lion dollars being partially offset by Treasury
transfers out of the District amounting to 19
million dollars and the payment into circulation
of 4 million dollars in cash and currency other
than Federal reserve notes.

R E P O R T IN G M E M B E R B A N K S — Twelfth District
(In m illion s of dollars)

F E D E R A L R E SE R V E B A N K O F S A N F R A N C IS C O

a

O

---------------------Condition-------1928

T otal Loans and Investm ents . .
T otal L o a n s ................................. . .
C om m ercial L o a n s ....................
L oans on Securities.....................
Investm ents ..................................
Net Dem and D e p o s i t s ...............
Tim e D e p o s i t s ............. .............. . .
B orrow in gs from Federal R e­
serve B a n k .................................




2,027
1,362
973
389
665
851
1,013

(In m illion s of dollars)

Sept.26, Sept.12, Oct.19,
1928
1927
1928

2,009
1,349
966
383
660
824
1,018

1,998
1,353
986
367
645
853
1,016

1,828
1,281
946
335
547
794
933

58

93

35

t-----------------

Condition ---Oct. 17, Sept.26, Sept.12, Oct. 19,
1928
1928
1928
1927

T otal Bills and S e c u r it ie s ............. .
Bills D iscounted ...............................

132
76

U nited States S ecurities..................
T otal Reserves ................................. .
T otal D e p o s it s ................................... .
Federal R eserve N otes in Circu.

16
251
197

120
64
39
17
262
190

151
99
33
19
238
195

95
42
7
46
280
187

169

170

174

171

O cto b e r , 1928

M O N T H L Y REVIEW OF BUSINESS CONDITIONS

80

E a r n i n g s

a n d

E x p e n s e s

o f M e m b e r

B a n k s

in

T w e l f t h

District

Analysis o f Costs and Earnings o f Non-Branch Operating Banks During 1927 .
(Statem ent of amounts per $100 o f earning assets in even dollars and cents results in some instances in slight discrepancies betw een
com ponent figures and related totals.)
Twelfth
D is tr i c t *

California

Idaho

Oregon

Utah

W ash ­
ington

620

213

73

148

128

45

$6. 7\\

$6.44
5.74
.69

$7.52
6.67
.85

$6.65
5.91
.73

$6.88
5.98
.89

?

4.75
1.50
.11
2.03
1.11

5.61
1.90
.15
2.11
1.44

4.78
1.70
.04
1.96
1.07

5.08
1.54
.08
2.23
1.22

Net Earnings ................... ............................ 1.-77.

7

1.68

1.91

1.80

1.80

Net Losses.......................................................•??.

7)

.65

1.56

.83

.99

Net Addition to Profits................................... •??.

3>

1.03

.35

1.03

.81

19

Dividends Declared..........................................-7?.

71

.73

.34

.65

.71

*!>

89.23
10.77

88.72
11.28

88.95
11.05

86.99
13.01

73.84
23.28
1.78
31.54
17.24

74.58
25.29
2.03
28.07
19.19

71.94
25.64
.66
29.56
16.09

73.83
22.46
1.18
32.48
17.72

26.15

25.42

28.06

26.17

Number of Banks....................................................
Amount per $100 of Earning Assets
Total Earnings........................................... .$.6-77.
Interest Earned ..........................................$.91.
Other Earnings ........................................... *86

*!>

V.

Total Expenses...............................................$.00.
Salaries and Wages ...................................
Interest and Discount on Borrowed Money... .*0?.
Interest on Deposits..................................2-03.
All Other Expenses ................................... l.*?3.

54
.)

3

Amount per $100 of Earnings
Interest Earned .......................................$7.36
Other Earnings .......................................X?-97.
Total Expenses ..........................................7.3-7?.
Salaries and Wages..................................24.41.
Interest and Discount on Borrowed Money.. l.-?4.
Interest on Deposits................................ 29.93
All Other Expenses ................................ .18.21.

71
21.
3 )'
U

Net Earnings ............................................. 26.2J.

56

*4
34
30
\:f
7(>

x

.

7,;.;

/

2J!J IV>

*

H!
21
2 lf c ;

Net Losses .................................................. 1.2-19

ii).

10.19

20.80

12.49

14.37

Net Addition to Profits................................ 1.4-P?.

1

15.96

4.62

15.57

11.80

l$ j

Dividends Declared.......................................l.Q-7?.

10 .9 5

11.34

4.46

9.77

10.27

1

$752.76
2.62
1.93
36.32
68.74
4.69
26.57

$804.90
7.21
1.90
46.16
61.33
15.78
22.89

$701.16
5.69
2.34
40.05
38.64
31.70
29.65

$79

Nevada

Oregon

Utah

R

a

i;

t i o s

(Amount per $100)1

Earning Assets to Invested Capital................ $734-&2$72;.
Profits to Invested Capital...... ......................... 6.89 ;\h
Interest on Deposits to Gross Deposits................ ?. 1.1
Time Deposits to Gross Deposits...................... 38.54
Losses on Loans to Total Losses........................
Losses on Securities to Total Losses................ 1?\1P.
Other Losses to Total Losses........................... ??•.??.

$665.07
6.84
2.29
34.00
64.19
14.67
21.14
r a t i v e

I t e m

3j22

s

SIE 30, 1927
Twelfth
District

Per Cent of Member Banks to
All Banks........................... 72.67
Per Cent of Member Banks in
Each State to All Member
Banks in the District.......... 100.00

Arizona

California

Idaho

80.77

73.85

69.88

42.80

77.51

53.69

1.05

78.02

1.73

.52

6.61

2.54

W ash ­
ington

9.53

“■Includes figures for A rizon a and Nevada which are not shown separately because o f small num bers o f banks included.
These ratios are based upon data taken from the custom ary abstracts o f reports o f con dition and of earnings, expenses, and dividends.
I t should be borne in m ind in using them that the statistics em ployed represent aggregates for all m em ber banks reporting on thè
various dates, and such ratios as are shown in this table are therefore ratios o f aggregates in w hich figures fo r large banks have
a statistical influence som ew hat disproportionate to their num ber in com parison with the figures fo r small banks. Data are on ly
for m em ber banks fo r which com plete con dition reports for every call in a particular year w ere available. W h ere reports fo r any
bank were not com plete during any year all figures for that bank were om itted.