Full text of New England Economic Review : March 25, 1919

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Federal Reserve Bank
OF BOSTON
Business and Money Conditions in the New England District
as prepared by Frederic H. Curti11. Chairman and Federal Reserve Agent.
This report is compiled about the twentieth of each month and is published for the information
of member bank s and others who have assisted in its preparation .

BosTON, MASS. , March 25, 1919
S1tisfactory progress is being made through/ 6 ut the district in adjusting business to prevailing conditions.
N 1turally some localities have made far more
progress or have had fewer diffi culties than
others, and so a decidedly mixed situation prevails temporarily in New England as a whole.
Th e trend, however, is very decidedly in the
direction of better busin ess, and it appears that
for the present at least the worst is behind.
Several features are predominant : namelyretail trade has been and continues to be almost
univers1lly good; savi ngs deposi ts, both in
trust companies and savings banks, continue to
increase at an extremely satisfactory rate;
prices of some goods not only are not decreasing, but are even advancing; and those lines
which have been stagnant are beginning to
show signs of activity.
Labor conditions, except in certain
Labor cen tres where st rikes have been in
progress, are by no means alarming, and many
of those being released from war work are
finding no great difficulty in obtaining employment, especially if willing to accept lower than
war-time wages.
,
Rates have remained steady for the
Money last two weeks, alt hough somewhat
higher than a month ago. Legitimate requirements are being cared for with no difficulty.
Call money is quoted 5 ½ per cent. to 6 per
cent.; time money is quiet at 5 ¾ per cent. to
6 per cent., with some concessions on large
accounts. Some commercial paper is being
sold at 5 ½ per cent., and in exceptional cases
at 5 ¼. per cent. Bankers' acceptances are
quoted 4·bi per cent. endorsed, and 4f6 per
cent. unendorsed.
Unlike woolen mills whose raw
Cotton material was all held by the Government, cotton mills had anticipated their needs
for several months ahead on the basis of full
production before the armistice was signed.
Curtailment of product ion through red uction in
working hours per week or through shut-downs
has made stocks of cotton held by the mills last

almost twice as long as had been anticipated.
As a consequence there is no demand for raw
cotton in New England.
Probably mill production has increased
slightly over a month ago. In one case it has
been reported that several mills which were
closed for a number of weeks are now running
three days each week. Some mi lls, to keep
their organization intact, have solicited orders
for future delivery without fixing the actual
sales prices. Curtailment has enabled the
making of much need ed repairs and re-arrangement of machinery on a more efficient basis.
New const ruction
Building Operations contemplated in Bosand Lumber
ton during February
failed to equ:tl in value that of February, 1918.
Reports from twelve cities show the number of
permits granted was much larger than a year
ago. Alterations permitted were over 75 per
cent. greater in value than in February, 1918.
The lumber market has al ready felt the effect
of increasing buildin g act ivity, with inquiries
for lumber coming freely from scattered poin ts.
Sales are still far below normal, but have been
in slightly larger volume than during th e previous month. Most of the lumber sold has been
for heavier types of construction and not for
dwellings.
vVholesale merchants continue
Dry Goods to experience a good demand for
all classes of dry goods. As yet no great effort
is being made to induce retailers to place future
orders. Current demand alone is sufficient to
create a good volume of sales and no further
extreme reductions in prices have had to be
made. Slight readjustments are occurring
in both directions, with a general downward
tendency.
Confidence is returning to retailers, who see
no let-up in their own sales, which may be
expected to grow steadily. Sales to consumers
continue abnormally high, which may be accouqte<l for in part by the demand of well-to-do
purchasers who had greatly curtailed their
consumption during the war. Con sidering the

volume of transactions, collections are extremely has reached its lowest point, and from now on
will begin to steadily increase. Increased de' satisfactory.
The leather market shows mand is coming, especially from New York, for
Leather and • considerable more activity, with goods to fill present needs. Futu re orders are
Shoes
prices somewhat firmer. Ship- not yet forthcoming, and until they are placed
ments are goihg forward to an increased number the production of woolens will be very far below
of foreign countries from which import re- normal. An estimate has been made that mills
strictions have been lifted, although in most are running at less than 50 per cent. of capacity,
ca es it is still necessary to obtain import which produces an output that amply cares for
current needs.
permits.
With continued buying on the part of foreign
The following synopses from reports of
countries and only limited shipments of hides
coming from South America through the port bankers outline local condit ions in representative
of Montevideo, there is no prospect of any cities.
General condit ions are fairly
reduction in the price of leather. Prices of
shoes for fall deliveries are therefore being Augu sta , Me. satisfactory. Pulp and paper
fixed with the expectation that there will be mills are running full, cotton mills are operating
on reduced schedules, and shoe factories are
no further advance in the cost of production.
S!ight reductions in the cost of findings are practically closed down. Smaller industries are
looked for and will offset any advances in the slightly below normal. Retail business is quiet
and the local money market is easy. There
leather markd which may possibly occur.
Domestic sales of shoes, both in number of are no signs of labor troubles, although closed
pairs and value, greatly exceed those of last shoe factories cause some idleness.
.
Conditions are very favoryear. Dealers are using more care in placing
orders, and buy only those styles which manu- Lewaston, Me. able. Cotton mills are running
facturers are likely to carry for their own retail on approximately a 75 per cent. basis of produc·tores. • In this way their limited capital can tion. There is very little idle labor. Retailers
be used to better advantage through frequent are having good trade and the outlook for future
re-orders. In general , factories are running business is very good indeed. Local demands
well up to capacity which, due to Jes efficiency for money are absorbing the current supply.
There is very little unemon the part of labor, is not nearly as great as
Concord, N. H. ployment. Nearly all manupreviously.
_
Imports at the port factories are working six days a week, althou,gh
Imports and Exports of Boston are practically a number of them have not many orders in adthe same as a year ago. Exports, however, are vance. The local money market is fairly active.
The amount ot business being
almost double those of February, 1918.
W l
Results of the last wool auctions were Rutland, Vt. done by man ufacturers and re00
extremely satisfactory. Wool was in tailers is on the whole very satisfactory, and
good demand and even with larger offerings business appears to be adjusting itself without
any great disturbance. There is some unemlittle was withdrawn.
The competition for Australian wool was so ployment, but not enough to be serious. The
keen that considerable advances over upset local demand for money is quite active.
All shoe manufact uring
prices were recorded.
The fact that there is a real demand on the Brockton, Mass. p!:ints are operating to
part of woolen mills for about 7 S per cent. of capacity and reports from salesmen indicate
the stock of wool held by the Government indi- that a comfortable business may be expected.
cates that the loss on this wool will be greatly Factory payrolls are heavy, and there is but a
slight surplus of labor. Many Government
reduced from early estimates.
In connection with English auctions it has contracts were taken on a narrow margin and
been announced that there will be a reduction without the abnormal increase in wages effecof 7¼ per cent. in the British issue prices, and tive in some lines. As a consequence, the rethat American buyers will not be permitted to turn to a peace basis is not looked upon with
bid in the English market. This rather effec- much apprehension. The Government requiretivelyremoves all competition with the American ments have left the banks limited as to funds
Government in this market, as only small to invest in commercial paper.
quantities of wool from Argentina have found
Cancellations and paucity
their way here and been sold at prices under Taunton, Mass. of new orders have caused
the upset prices of the auction.
manufacturers, especially in textile and metal
It would seem that woolen mill production lines, to shorten hours and reduce the number

of their employees, resulting in considerable
unemployment. Money is well employed, but
there is no visible local stringency.
The readjustment of busi•
Fall River, MaH, ness to a peace basis is
proceeding slowly. Labor conditions are peaceful. Mills are on a forty-eight hour week, and
two-thirds of thf' mills are only running three
or four days a week. Some mills which have
heen shut down are starting up. Manufacturers
are holding back what few goods they are making
for better prices. Retailers are doing a good
business. The local money market is strong.
Silk manufacturers
Northampton, MaH, are very busy, with no
falling off in r,rders. Labor conditions are in
fair shape, with some shortage in the mills. The
money market is a little easier. The prospects
are for better labor conditions on the farms
this year.
Conditions in the textile
Pittsfield, Mass. trade are improving. The
branch of the General Electric Company is
employing 75 per cent. of its maximum help and
running five days a week. The local money
market is normal. Retail business is satisfactory. There is considerable unemployment.
i General conditions are not
Holyoke, Mass. 'very satisfactory. The paper
business is absolutely flat. Many of the other
industries are just moving, some running only
two days a week. Retailers report business
only fair. The local money market is unchanged.
The woolen business is
Providence, R. I. beginning to show signs
of life, and some orders are being received. The
jewelry business is good in solid lines, but not
in cheaper products. In some department
stores, sales are ahead of last year. The unemployment is estimated at several thousand,
although skilled jewelry workers are scarce.
Money rates are s.¼ per cent. to 6 per cent.,
with some shading where large balances are
carried.

Many lines are dull, but no
Pawtucket, R. I, concern has entirely closed.
The general feeling is one of optimism. Retail
business is unusually good in all lines. Labor,
except highly skilled, is plentiful.
Business conditions can be
Hartford, Conn. looked upon as very favorable. Local factories are getting into line on a
peace basis, and those formerly working on
munitions are entering new fields. Retail
stores report a good volume of business, with
collections good.
There is some idle labor, but many employees
leaving war work are finding employment in
peace work. While there is not an over supply
of funds in the money market, still there is no
disposition to restrict credit.
.
All the cotton mills are
Norwich, Conn. running, the woolen mills
are just starting up, and a munition plant,
which has been closed for several weeks, is
ready to start with 1,000 employees. Collections are slow and business dull.
The cancellation of
New Haven, Conn. war orders has been felt
keenly and there is considerable unemployment,
estimated at 7,500. Many of these people were
attracted to New Haven from other cities during the war period. Manufacturers and business men are endeavoring to resume business
on a peace basis and reabsorb employees released from munition work. The local money
market rules at 6 per cent.
Poetal Receipt• in the L•rller Citiee ia thi• Diatriet
Febnaary. •19

February, •18

Cb&aae. %

$101,492 $10l,967
19, 769
20,806
22,879
24,918
89,056
78,722
101,218
102,616
60,481
61 ,482
. $394,895 $391,511
829,244
797,538
. $1,224,139 $1,189,049
Total
Total• for J•auuy $1,375,862 $1,297,725

Hartford
Lowell
.
New Bedford .
New Haven .
Providence
Worcester
Outaide of B01toa
Boston

-

1.41
4.98

-

8. 18

+13.12
- 1.36
- 1.62

+ 0.86

+
+
+

l .97
2.9S
6.02

Subscriptions to Certificates of Indebtedness
la Aatieipetioa of the Fifth Liberty Lo•a
Jp ue Oared

Tow

l"ebruary l:i

laue Dated
February 27

l81tu: Datcd

January

Marcb 13

Subscription

Total
Quota

$4,246,500
6,158,500
ll,587,000
1,952,500
1,696,000
781,000

$4,395,000
5,644,SOO
27,931,000
1,656,500
1,384,500
847,500

$4,422,000
9,400,500
30,572,000
1,589,000
1,918,500
552,000

$17,154,000
S5,706,500
260,669,SOO
15,848,000
13,017,000
7,346,000

$36,300,000
54,600,000
266, s00,000
18,200,000
15,200,000
12,100,000

102.
102 .
98 .
87.

$92,911,500 $158,045,000 $48,421,500 $41,909,000 $48,454,000 $389,741,000 $402,900,000
52,000,000 43,000,000 43,300,000 402,900,COO
95,300,000 169,000,000

97.

o~ccmbcr

S9,03'9,500 $15,05 1,000
Rhode Island,
20,992,000
13,511,000
Conn ecticut,
60,914,000 107,615,SOO
Massachusetts,
6,411,500
4,238,500
Maine,
4,861,500
New Hampshire, ,3 ,156,500
3,113,500
2,052,000
Vermont,

Total,
Quot•,

hrccut.
of QIIOCJI

l:11ued in

lHurd in

Subtcribetl

86.

61.

-

Boston Clearing Houoe fi&ures compare •• followo,

Clearin& House Bank• in the lar&er citie1 in thio diotriet

(In Tbouunds of Dollard

llepon tbc followinc u the total cbarce1 to their depot1,on 1 :1ccount1:

Feb. 21, •19

~tar. 23, '18

SH,358
4,754

11
SH,200
4,747

533,150
434,286

519,875
410,125

11
$33,200
4,966
489,406
415,777

111,537
12,346

105, 370
12,686

125 ,018
21,108

14,331

15,755

14,641

67,632

6'3,878

85,275

Federal Reserve Bank,

58,979

58,693

57,265

Excess Reserve and Cash,

12,223

14,726

12,544

iZ9,456

231 , 367

263,505

Mar. 22. '19

Number of Banks
Capital
Circulation
Loans and Discounts
D eman<l Deposits
Due to Bank s
Time D eposits
Exchanges for Clearing
Due from Banks .
Cash an<l Reserve with

Exchanges for week

11

(Ja Tbousands of Doltau)

Four Wcckt
End inr
Mar. 19. •10

Feb. 19, •10

$12,052
23 ,426
80,385
12, I 19
17,597
20,32~
62,508
108,024
45,200
26,059
54,584

$11 ,4 34
26,943
73,747
13,772
21,093
24,973
65,%7
117,522
50,886
32, 738
58,536

Total outside of Boston
Hoston

$462,279
1,65'3,897

$ 497,611
1, 677, 976

Total all Citie s .

$2,116,176

$2,175,587

Rangnr, Me.
Fall River, Mass.
Hartford, Conn.
Holyoke, Mass.
Lowell, Mass.
New Bedford, Mass.
New Haven, Conn.
Providence, R. I.
Springfield, Mass.
Waterbury, Conn.
\\' orcester, Mass.

Four \\·eeks
£ndinr

Condition of Thirty-eight Selected Member Banks
O N M ARCIi 21, ]919
\-Vith Comparative Totals for February 21, 1919, and Mard, 22, 1918
(In T housands of Oollan)
Other U. S.
Ronds

Jndudinr
I.. L. Bonds

Hartfor<l, Conn.
NelV Haven, Conn.
Providence, R. I.
Springfield, Mass.
Total outside Boston
Hoston, Ma.ss.
Total Mar. 21, 1919
Total Feb. 21, 1919
Total Mar. 22, 1918

u. s.

Cc:rti6ca1e-sof
l ndc:b:rdnru

~4, 165
5,688
18,736
6,230
34,819
67,382
102,201
94,306
39,991

Sl,696

3,6UU
1,635
J, 798
8,719
8,306
17,025
16,43e
11,320

Loan~ ~n:u rt'd
by l '. S.

All other

kc11r·nc: wi1II

HunJs aml

l.uaus ;and

Fctk~I
Re,-en-c Hank

Certi6att's

lm·t>stll\t"llt!l

1,007
3,45 7
4,285
2,533
11,282
69,H5
80,627
75,281
35,402

$32,416
20,03!
99,416
22, 056
173,940
507,707
681,647
656,366
732,623

$2,3);

1,422
3,008
1,489
8,274
39,765
48,039
54,139
60,025

~d Ormand
l>f'posits on
\\ bid, Rrs:c: rre

T ime

f:Memment

i• t:umputM

Dc: po1i1J

Oc:pusits

$33,206
20, 190
53,612
22,369
129,367
503,059
632,426
615,879
602,939

1,531
2,675
43, 28 4
3,147
50,637
28,HO
78,977
78,016
75,910

2,960
4, 98 9
4,5 75
1,350
13,874
47,682
61,556
41,595
74,916

Statement of Condition of the Federal Reserve Bank of Boston
On T housands uf Ooll:irs)

RESOURCES
Mar. ~I. ·H)

Gol<l Resen•e against F. R. Notes,
Gold Reserve against Deposits,
Total Gold .
Legal Tender and Silver
Total Re•erves
Discounts secured by U. S. Sec.,
Discounts - Commercial Paper
Rankers Acct. bought in open market,
U.S.Sec. pledged to secure circulation,
Other U. S. Securities owned
Total Earning A11cts .
Uncollected Items
Other Resources
Total Resources .

$66,972
35,387
102,359
6,334
108,693
136,864
5,0SS
10,572
14,416
538
167,475
77,164
1,740
355,072

LIABILITIES
..-eb. 20, •U) Mar. 22, •)8

$64,651
45,687
11 0,338
5,650
115,988
138, I 58
7,831
12,033
11,416
538
169,976
53,617
1,673
341,254

$50,496
59,827
110,323
4,383
114,706
46,906
9,923
11,475
3,144
71,448
20,065
1,841
208,060

~-tar. 21, •19

Feb. 2:J, •l f

F. R. Notes Net
165,338 $ 158, 190
F. R. Rmk Notes 1 t t 1 13 ,0 34
9,989
Due Trea;ury U.S. ,
39,24 1
24, 150
Due Members Net ,
85,311
96,364
Collection Items, etc., 40,026
40,562
161,076
Gross Deposits, 164,578
Capital
6,775
6,773
Surplus
2, 996
1,535
A ll other Liabilitie,,
2,351
3, 691

Total Liabilitie1, 355,072

341,254

Mar. 22, •18

90,844
5, 728
87,247
17,01 5
109,99C
6,351
75

800

208,060

OFFICERS
C HAR LES A. MORSS
Governor
C HARLES E. SPENCER, J R.
D,puty Governor

FRANK W. CHASE
WILLI AM . KENYO

1

FREDER IC H. CURTI SS
Chairman anti Fedtra/ R,ser'Vl! .I/gent
R USSELL B. SPEAR
CH ESTER C. BULLEN
AssisJaNI Federal Res,rve Agent
Deputy Governor and Cashier
Assistant Caslzitrr
ER ' EST M. LEAVITT
H ARRY A. SAUNDERS

L. WALLA CE SWEETSER
WILLIAM WILLETT