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FEDERAL RESERVE BANK OF ST. LOU!S M O N T H L Y R E P O R T ON GENERAL BUSINESS AND AGRICULTURAL CONDITIONS IN FEDERAL RESERVE DISTRICT No. 8 RELEASED FOR P U B L ! C A T ) O N ON AND AFTER THE A FT ER N OON OF A UG US T 2 7, 192 0 WtLUAM C WAt RM AN OF TH E BOARD MCC. AND HTHE trend of things in general business through this district during the past month indicates more definite and significant steps in the direction of readjustment than have been observed up to this time. The coursc o f values on a much broader classification of com m odities is downward, and included in things which have declined are several important staples which for a long period had remained unshaken at abnorm ally high levels. A notable feature is the greater abundance o f goods. Articles heretofore scarce have becom e relatively plentiful. Competition has developed am ong pro ducers and distributors to dispose of their merchan dise and, after many months o f solid entrenchment in the seller's position, the market is veering to a buyer's affair. Measured in dollars and cents the volume of trade holds up well as contrasted with the corre sponding period last season, and to date there has been no marked decline in the purchasing pow er of the public. W hile there is some unemployment, it is far from the general rule, and fundamentally con ditions are strong. W ithal much greater conser vatism and a disposition to econom y and caution are observable, both am ong the public and am ong mer chants. Price declines, where they have occurred, make for uncertainty, and give rise to the belief, well or ill founded, that soon they will extend to other lines. This has caused buyers to hold off. with the result that in certain branches o f business Yery unsatisfactory conditions have developed. The high interest rates charged by banks have empha sized this state o f affairs, and in some quarters col lections are poor. Elsewhere, notably in drugs and chemicals, and hardware and metal good s generally, the recent upward pace has been well maintained. In these lines production has not caught up with the demand, or if it has, railroad facilities have not permitted o f distribution sufficiently adequate to meet requirements. Relative to the position o f the householder, the declines o f the past few weeks should bring about reductions in his general outlay, as they extend to . foodstuffs, clothing and other articles consumed in the home, but to offset this beneficial consummation ^re added costs due to further advancing rents, high fuel prices, increased railroad rates and higher ^ large and important divisions o f labor. While com paratively small in its direct bearing on total cost of living, the result o f each o f these items is cumulative, and in the final reckoning will largely equalize the reductions in prices thus far scored, and -^ave the total o f m onthly bills about as they have been Digitized forduring FRASERthe first half of this year. MARTtN, FE DER AL RESERVE A GE NT It is now conceded that the size of the crops in this district and the country at large will be enor mous. Yields of virtually everything will be ample for home consumption and still leave a liberal mar gin for shipment to foreign customers. Recent rains put an end to drouth, in the dry areas, and, according to latest reports, came in time to work incalculable benefit to corn, potatoes and other late crops. It is believed that the 3,000,000,000 bushel output o f corn, as predicted in the Government's August 1 report, will be fully realized, with quotas in States of the Eighth Federal Reserve District somewhat in excess of the W ashington estimate. None of the Federal Reserve Districts is more dependent for its prosperity upon agriculture than this one, so that the success of the crops will go far to brace confidence and stimulate business. Already beneficial effects are being felt. Jobbers in the larger cities report a decidedly better tone in buying since the f rst of August. Buyers are appear ing in large numbers, and almost to a man are opti mistic in their views. In such lines as shoes, dry goods and millinery, cancellations have come to an end, and reinstatements of many orders canceled earlier are reported. Coincident with large crops are relatively high prices for farm products as compared with former seasons. This is true despite the recent upheaval in the grain market, during which cereal quotations underwent an unusual and radical decline. Trad ing in wheat futures was reinstated on the leading exchanges on July 15, after having been suspended for nearly three years. On that date the top price for the December option was $2.75, from which fig ure it declined to $2.09 on A ugust 2. T w o days later, August 4, the European "w ar scare" caused a sensational recovery, the price mounting to $2.30, and at the close, on August 16, the quotation here was $2.39%. Other grains also fluctuated violently during the same period, but at the close on A u gust 16 were well under prevailing quotations on July 16. September corn closed at $1.51% on tuly 16. and at $1.47% on August 16; December corn at $1.40'4 on July 16, and $1.23% on August 16; September oats, 7 7 ^ c on July 16, and 6 9% c on August 16. Comparisons of spot grains for the tw o dates develop relatively sharper declines than do the options. This break in prices took place in face o f light arrivals of grain at primary points, but it is a well-established fact am ong the trade that the scant movem ent is due to the car shortage and not to any lack of supplies back in the country. T he present high price o f wheat is attributed to the foreign demand, and upon the extent and length of export buying largely depends the future ot the market. Among the commodities on which price declines have been recorded may be mentioned sugar, cof fee, certain cotton goods, boots and shoes, silks, some notions, wools, crude rubber, rice, leather nerv, lower priced furniture and ready-to-wear cloth ing" As was the case during the preceding month, however, cheaper clothing prices were confined largely to goods covered by special sales. In stand ard lines prices changes have been insignificant. High-grade woolens continue very expensive, and there is universal complaint among tailors of apathy in their business. Customers are refusing to pay the high prices which merchant tailors claim they are obliged to ask because of increased cost of mate rials and doing business. Regular patrons of years' standing, they say, are turning to the ready-to-wear establishments or wearing their old garments. Fuel conditions just now constitute one of the most disturbing factors in the general business status. Production has been hampered by labor disputes and the car shortage, and considerable un certainty exists in the minds of commercial and domestic consumers as to future supplies. In the immediate past some improvement has developed, due to partial adjustment of difficulties at the mines and freer transportation. W ith a reasonably mild winter to January 1, dealers estimate that they can easily catch up with the demand. On the other hand, an early and severe winter, or renewed labor and transportation disabilities, could produce a crit ical situation. In any event, however, dealers de clare prices will remain high through the season. Metallurgical coke is scarce almost to the point of famine. Prices for the 72-hour Connellsville prod uct range from $20 to $22, ovens, which compares with $7.50 per ton when the Government released control of fuel a few months back. The reactionary tendency in the automobile in dustry is still more sharply defined, and is reported to be extending to accessories. According to dealers the slowing down in purchases of new cars is due largely to the credit situation. Full 80 to 90 per cent of automobile buying is on time, and with banks refusing to handle this sort of collateral, dealers are forced to turn to brokers and other private sources for obtaining money, and rates demanded are such as to make time transactions much less attractive than when the banks were in a position to take on the business. Another detri- Officials of railroads operating in the district report gradual improvement in the transportation situation, and while their claims are not entirely confirmed by shippers, the freight movement is un doubtedly vastly more efficient than was the case six weeks or two months ago. The intensive cam paign to increase mileage for locomotives and cars is bearing fruit, and while at the moment the car riers are not getting much new equipment, they are making better use of what they have. Having been granted their increase in rates, the railroads are in a position to immediately place orders for rolling stock and motive power, and the country at large will closely follow developments along these lines. Passenger traffic in the district continues to roll up new record totals. Ticket sales of June, July and early August were heaviest in the history of the roads in this region, due to unprecedented vaca tion travel. Reservations are booked well into September, and all lines report an acute shortage of sleeping cars. Rather diverse reports are made relative to col lections, but the average shows a falling off as contrasted with recent showings. In several hnM settlements are decidedly backward, but in ware, drugs and metals the efficiency is high. T'8^* money and slow transportation are given as the principal reasons for dilatory pay ments. Commer cial failures in the Eighth Federal Reserve District during July, according to Dun's, were 28, involving liabilities of $96,040. against 34 in June, $2,283,000, and 44 with liabilities of $240,812 m July, 1919. Bond houses and financial institutions report apathy in the market for bonds. The high rates offered by the Government and prime commercia sources are attracting investment funds to the detri ment of regular lines of securities which usually go into strong boxes. The absence from town o f m vestors on vacations is another contributing cause to the dullness, as is also the downward movemen in New York stocks. The per capita circulation in the on August 1, 1920. was $57.07, against $56.79 o July 1 and $54.40 on August 1, 1919. M A N U F A C T U R IN G A N D W H O L E S A L E Uneven conditions prevail in the departments of jobbing and manufacture, and the past thirty days have been marked by a greater degree of uncertainty and wilder fluctuation than any similar period in recent months. The fact that production is catching up with, and even exceeding, the de mand, is evidenced by the greater facility with which goods can be had. and downward revisions in prices on numerous important commodities. Manufacturers report a loosening up in raw materials, due both to heavier outputs at points of productions, and improvement in transportation facilities. Some lines report no reaction whateyer mental factor working in the industry is the senti mental effect of persistent talk of diminishing oil reserves and prospects for prohibitive gasoline prices. from their recent state of great prosperity The# .sales are running steady to a shade better than preceding month and well over the same 1919. Elsewhere accounts are less flattering reductions, actual and expected, have caused r tailers to place orders with the utmost caution. ^ even ultimate consumers are disposed to hold in anticipation of more reasonable prices Plant operation in the district, however, has be pretty well maintained, there being very few ac shut-downs, and vastly less reduction in than noted in similar industries elsewh _ Fuel and cars are scarce, and foundries, naces and smelters are feeling the pinch of scarce and extravagantly high coke. L abor conditions are improving, workers generally being more plentiful, and efficiency a shade higher. W ages, however, continue high, with the tendency upward in many industries. The extremely optim istic crop situation is prov ing a saving clause, and goes far to stabilize busi ness and offset the less favorable factors. W h ole salers and jobbers for the most part report that the cancellation story, which ran through June and part of July, has com e to an end. This is true par ticularly in dry goods and shoes. The regular influx of August buyers in St. Louis, and other cities of the district, has been large, and the character of their purchasing is more satisfactory than expected. The general disposition is to take no more than needed for current requirements, but such require ments are apparently o f g ood ly volume. The issue to the South depends largely upon the outcom e of the cotton crop, which at this juncture seems in a fair way to prove satisfactory in states o f this dis trict. Conservatism is dictated more by the desire to play safe than any feeling o f pessimism. Boots and Shoes— Generally business is described as steady to a shade less active than the preceding month, but big increases are shown by leading in terests over the same period a year ago. Prices are definitely lower, but the decline is not as marked as had been looked for by the public. One important manufacturer places the average price reduction through his line at from 3 to 5 per cent. Some specific grades are o ff considerably more than the major figure o f this spread, notably calfskins and the higher priced w om en's shoes. X ow here was there pessimism expressed, and the outlook for fall and winter business is reported good. Country merchants, as indicated by A u gust buying, are in a more settled frame o f mind, and while forward orders are smaller than in som e preceding seasons, there is no hesitation about taking ample goods for immediate needs. Few cancellations were re ported, and the volum e of returned goods has fallen off. W oodenware— Prices in this industry continue strong, and the demand for everything holds up well. Production in July o f interests canvassed held about steady with the preceding month. Labor is more plentiful, but som e difficulty is being experi enced in obtaining raw materials, due to the car shortage. C ollections are fair to good. Candy — Leading manufacturers and wholesalers report sales about on a parity with the same time ast year, but a well defined disposition on the part o buyers to hold off. The chief cause o f this is c recent dem oralization o f the sugar market. It now develops that there are huge supplies o f sugar *n all positions, while on ly a few weeks back there .concerted effort in certain quarters to em phasize that stocks were short to the point o f exaustion. The financial situation has caused heavy 'qutdation o f candy stocks, and retailers are buying now from hand to mouth, believing reductions are stable. T o date, how ever, there have been no notable declines in selling price. T he current, or unmedtate, demand is normal, but manufacturers Digitized are a for bitFRASER dubious as to future business. Dtugs and Chemicals— Still further improvement on top of recent prosperity is reported by interests engaged in this line. The demand is overwhelming, and during the past few days has been stimulated by a desire on the part of retailers to get in stocks before the new freight rates become effective. In several o f the larger drug houses, forces have been working nights and Sundays since August 1. Prices hold steady to strong, and no change in this respect, nor in the volume of business, is looked for during the next few months. July returns develop in creases o f from 10 to 25 per cent in the amount of business done as compared with July, 1919. In the specialty of soda fountain supplies business was never better, with manufacturers and distributors experiencing difficulty in keeping up with the de mand. Considerable activity is reported in chem icals used for ice manufacturing. Clothing— Differences of opinion, almost as nu merous as those to whom inquiries were addressed, were expressed relative to the present and future conditions of business. Classification and analysis o f replies, however, develops that things are in much the same position as a month ago. There have been some further reductions, and great hesi tation is displayed in buying for fall and winter trade. The public has been led to believe that all ready-to-wear goods are due for a slump, and are governed sentimentally accordingly. Sales are run ning over those o f the same period last year, and collections, while not as good as they have been, are in the main satisfactory. Several important St. Louis manufacturers report that buying has slowed down, but that many cancelled orders have j been reinstated. The demand for made-up fur ! goods has picked up, and prices ai*e firm, despite the demoralized status of raw pelts. An interest ing sidelight on the fur situation is the statement o f a wholesale hardware man to the effect that the demand for animal traps is the largest in the history o f his business. Electrical Supplies— Taken as a whole manufac turing and distribution of electrical supplies in the district averages about steady with a month ago. The demand for numerous articles continues well in excess of supply, and this condition, judging from present indications, will obtain through this year. Enormous gains in sales in July were made over the same month in 1919, while a com parison of the preceding month this year shows a range from a loss of 10 per cent to gains as high as 12 per cent. Prices remain stationary, but the tendency is upward. Some cancellations of orders from automobile builders have been received. T ele phone companies and street railways are in the market for large quantities of goods. Iron and Steel Products— A bsolutely no slowing down has been noted in this classification and prices hold very strong, with further advances recorded. W arehouse interests are still behind on orders for certain goods, and it will be some time before trans portation and production can relieve this condition. During the last tw o weeks the demand for pig iron has picked up, sales for prom pt delivery and future shipment being in good volume. Southern pig iron, 1.75 to 2.25 per cent silicon, is quoted at $42 for last quarter and first half delivery. Foun dries in the district continue to operate at capacity, or as near that point as the supply of coke will permit. Castings, especially malleable, are urgently wanted, and new business is being turned down because of lack of capacity. Stove makers have all they can do, and report prospects for fall and winter business were rarely better at this particular season. A slight slowing down is reported in the inquiry for some building materials, but there is an insatiable demand for tubular goods and general oil development supplies from the Southwest. A leading sugar machinery manufacturer reports or ders ahead to engage his capacity for several months to com,e. There has been no improvement in the stringent scarcity of nails. Collections are good. Flour— Business for domestic consumption con tinues dead dull, and in general millers report the condition of their business most unsatisfactory. Buying by exporters has kept up the market, but the home trade will not pay the prices and is pur chasing in a hand-to-mouth fashion. All hands on the buying side are looking for cheaper wheat, and realization or disappointment of their hopes is entirely contingent upon how much of our surplus foreigners propose to take. The credit situation in the South is against laying in of stocks, and mer chants in that region are buying sparingly. There is a better call for clears and low grade than the patents and higher quality Hours. The dullness and unsettled state of the market made values diffi cult to determine, but quotably there is little change in prices as contrasted with a month ago. Mills are running at well below capacity, and collections are not uniformly satisfactory. Lumber— Expectations of the mills that heavy buying would develop prior to the new freight rates taking effect have not been realized. There has been no unusual buying movement, and things gen erally in the trade are quiet. The decline in soft pine prices has been checked, and on building lum ber the feeling at the moment is a shade hrmer. Sentiment, however, seems favorable to a further slump during the next few weeks, and this is causing buyers to hold off. Retail yards through the district are low on stocks, but are not replenish Fire Clay Products— Extensive concrete road work, activity in drainage and sewer improvements and the metal trades have conspired to maintain a fair pace of activity in fire clay and concrete lines. The demand in many instances is above supplies, and prices show an advance of about 10 per cent as compared with the preceding month and are 20 to 30 per cent higher than at this time last year. As an offset to these favorable influences, very un satisfactory conditions obtain in labor, fuel and transportation. Production has been seriously ham pered by strikes, and inability to secure raw ma terials. Paving brick is said to be virtually unob tainable. Provisions and Packing— Irregularity continues to feature the packing industry. The trend of prices has been easier, and a sharp break occurred in the lamb and mutton market, due chiefly to heavy im ports from Xew Zealond. Beef prices have sagged and the same is true of fresh pork. t nsettled con ditions prevail in the provisions futures market, with an accurate idea of actual conditions difficult to obtain. M iscellaneous— In other lines, such as cooperage, rope, glass, paints, furniture, bags, tobacco, plumb ing supplies and stationery, business is affected by about the same set o f influences w orkin g through the more extensive industries o f the district. O w n s are bein g placed w ith m ore conservatism , and lugh m oney rates are p laying an im portant part. The progress o f liquidation has been maintained, an m anufacturing program s for the fall and winter contem plate considerably less in the way of stoc accum ulations than h eretofore. In the m a i n raw materials are easier to obtain, and the labor situa tion is universally m ore flexible than earlier m t e year. R E T A IL In the retail section of distribution activity dur ing the past month has been fairly well sus tained. A notable feature, however, has been the growth of competition, it being a considerably mare difficult matter to dispose of goods offhand than was the case a few months ago. Shoppers are look ing for lower prices on everything, and insisting upon getting them. The radical break in sugar and coffee has led to the belief that other articles of food must react downward, but thus far there has been no general following of the lead of these two important staples. Canned and package goods, meats, bakery products, fruits, vegetables, dairy products, cereals and prepared sea foods show little price variation, and are still high. Department stores are doing an enormous business, July returns showing gains of from 5 to 15 per cent over last Digitizedyear's for FRASER totals, but here, as with the smaller stores, ing to any great extent, not wanting to be caught with expensive lumber should a further break occur ' in the market. The scarcity of nails and other build ing materials is working adversely in the lumber business. Hard woods are slow, with the demand under supplies. Furniture and automobile factories have slowed down in their purchasing, and generally consumers are disposed to use up their reserve stocks and postpone buying until forced to do so. greater effort has been necessary to a c c o m p h s the results. Sales are being extensively advertis . and the usual tactics of salesmanship to promo e business are being resorted to. Clothing is moving well, being aided by seasonable weather, and gen eral price concessions. Jewelers report sales m do lars and cents about equal to a year ago, but t ^ number of customers has fallen off ^ contrasted with the preceding few months. is a good demand for expensive pieces, nota y set diamonds. Prices are steady to firm. Spo ing goods, photographic supplies, books and nottons are seasonably active, particularly sporting goo ^ of which there is a scarcity. Sales of guns an fishing tackle have been heavy. In the main are getting in their money promptly, but co* c tions are not up to the standard set earlier this ye i AGRICULTURE Generally speaking, weather since June 1 in this district has been almost ideal for grow th and development, and little doubt remains as to bumper yields of the leading crops, barring winter wheat. Drouth over certain important corn raising sections was relieved by tim ely rains this month, which incidentally freshened things up generally and worked great beneRt in pastures. W hile th e-outturn of winter wheat was disappointing as to quantity, latest threshing returns indicate a high quality. Answers to questionnaires sent to farmers and country merchants in the district develop improvement since last month, especially in corn. About 60 per cent of the answers report the corn prospects good, 30 per cent fair and only 10 per cent poor. Threshing of oats discloses somewhat uneven results, but in Illinois and Missouri and parts of Indiana yields are heavy and of excellent quality. The hay crop is turning out well, better in some sections than in many years. W hile potatoes in spots are not prom ising, the general average is good, only 5 per cent o f those reporting show ing poor. Apples are turning out better than had been anticipated, but the peach crop is disappointing. Yege? table gardens are in Rne shape in nearly all parts of the district. There are few com plaints relative to the supply o f labor, and those principally from the South. Help has been plentiful in the harvest Reids, and generally where crops have been garnered. Dairying is reported good. T obacco is generally doing well, with Reids clean and well cultivated. In central Kentucky fears of damage from "rust" and "wildRre" are reported. Burlev and cigar type tobaccos in Indiana are very good, but the crop is not doing, quite so well in the dark district. The condition of rice in Arkansas is excellent in virtually all the chief producing counties. The United States Department o f Agriculture makes the combined condition of all crops in the seven states of the district (10G=^average) 103.4 per cent as of August 1, against 95.8 on July 1. W hile reports as a whole on cotton are favorable there are some complaints of excessive precipitation and cool nights. In the main the crop is well cultivated and fruiting nicely, and altogether the prospect is Rne. The production o f cotton in the Eighth Federal Reserve District, as forecast by the U. S. Bureau of Crop Estimates on August 1, is 2,173,000 bales, which compares with 1,906,000 bales estimated on July 1, and 1,789,000 bales, the 1919 estimate. A great difficulty in connection with the new cotton crop is that the warehouses in Memphis and elsewhere are Riled practically to capacity with the old crop. The U. S. Department o f Agriculture, in its report as of August 1, gives the condition of winter wheat in Rve states o f this district as fo llo w s: Total Production in Thousands of Bushels December Estimate 1920* 1919 1914-18 Av. Illinois ................. 29,959 57,800 40,345 Indiana ................. 20,460 45.792 38.183 12,029 10,316 Kentucky ............. 6,304 M issouri............... 29,350 57,699 35,161 Tennessee.............. 4.155 7,290 8,035 Yield per Acre Quality Price per Bu. --------- Bu.--------% * August 1 10-Yr. Cents !920 Average 1920 Average 1920 1919 15.2 16.4 92 90 236 210 12.0 15.9 87 90 230 209 10.2 12.2 88 90 254 213 12.5 14.3 92 89 237 209 9.8 10.9 88 ' 89 265 221 *Preliminary Estimate. ' The U. S. Department of Agriculture, in its report as of August 1, gives the condition of corn in the seven states o f this district as fo llo w s : Condition Aug. 1 Forecast, 1920* Dec. Estimate* Price per Bushel 10-Yr. From From 5-Yr. Av. August 1 1920 Av. Aug. 1 July 1 1919 1914-18 1920 1919 %_________%_______Btt Cond. Bu. Cond. Bu.________ Bu.____________ Cents Arkansas .......................... 86 Illinois .............................. 75 Indiana .............................. 86 Kentucky .......................... 90 M is s is s ip p i..................... 77 M issouri............................ 84 Tennessee ........................ 89 75 78 81 80 79 73 83 59,232 284.871 177,924 96,941 66,399 200,159 82,032 50,941* 284,125 169,836 86,170 59,438 179,110 73,994 48,726 301,000 175,750 82,500 59,700 155,412 74,750 49,702 347,537 178,140 99,485 63,448 171,524 86,790 210 148 151 202 232 169 206 204 189 194 209 211 199 212 *In thousands of bushels—i. e., 000 omitted. LABOR In general industrial lines labor is reported some what more plentiful than at any time since the war. n centers of large population some unemployment *s noted, but idleness is conRned almost exclusively to those who do not desire work, or operatives affected by strikes. The trend of wages continues tipward, with several notable advances occurring urtng the past month. In the building trades there is considerable unrest and scattered strikes through out the district. In Evansville, Indiana, the furni ture workers' strike is now in its fourth month. A scarcity of female workers is reported in the cloth ing industry and other lines where skill and train ing are requisites. In the automobile industry work men are being laid off, but the need of skilled mechanics in other lines has been thus far suffi cient to absorb the surplus. In some sections there is a shortage of common labor, while elsewhere an overplus exists. Save in isolated sections of the South, there is little complaint relative to the supply of farm labor. In the mining areas of the district a large number of laborers have drifted temporarily to the harvest Reids, but in the lead and zinc region ample help remains for all purposes. COMMODITY M OVEM ENT Receipts and shipments of important commodities at St. Louis during July, 1920 and 1919, and June, 1920, as reported by the Merchants' Exchange, were as follows: July, 1920 Flour, barrels.......................... ....... 314,970 Wheat, bushels................................4,270,970 Corn, bushels....................................2,299,120 Oats, bushels................... ............... 2,264,000 Lead, pigs........................................ 214,730 Zinc and Spelter, slabs................. 366.180 Lumber, cars.................................... 10,727 Meats, pounds..................................6,380,800 Fresh Beef, pounds......................... 723,600 Lard, pounds....................................1,028,900 Hides, pounds.................................. 771,200 -ReceiptsJune, 1920 361,010 2.497,200 3.407.300 1.744.000 213,300 455.870 9,647 6,061,400 1.046,700 1.850.300 1,634,600 July, 1919 249,090 8.277.964 1,078,978 2.464.000 100,530 31,410 14.386 7.360.400 588.100 791,700 3,829.300 Ju ly.1920 337.670 397^70 2,115,990 1,527.530 1.534.750 120.620 580.640 6.174 22,946,600 24.305.400 5.996.8HO 2.230.500 -Shipments----------- —— June. 1920 July, 1919 412.690 271,765 1.731.020 1.874,060 1.625.460 1.067,215 1.679,580 1,921,380 205.630 185,820 822.320 687,280 7.384 11,222 22.368.700 24,497,800 19,652.500 24.530,600 6.234.400 5,183,700 2.639.100 6,392,200 BUILDING Building operations have been hampered by a combination of influences, and on the whole the industry is in rather unsatisfactory shape. Among the disabilities may be mentioned the scarcity and high cost of labor and material, and extreme diffi culty of financing loans on construction projects. Recently it has developed that contractors are loath to bid on construction. Uncertainties in the ma terial and labor markets make them hesitate to name a price at which they will do the work. A notable instance of this was in connection with a large hotel building project in St. Louis. The movement of building materials has been aided somewhat by the recent order of the Interstate Commerce Commis sion allowing cars with sideboards up to 40 inches Comparative building figures for July follow: to be used for that traffic. The housing situation is more cramped than ever, and prospects for relief arc remote. According to building experts, essen tia! construction, such as schools, hospitals, public buildings, factories and warehouses, will more than take up construction capacity for months to come, leaving nothing for application to residential needs. W ages in the building trades arc estimated to have reached their peak, and any future advances will be in the nature of adjustment of differentials. Statistics covering building operations in leading cities of the district during the past month show little change as compared with the same month last year. *1920 New Construction Permits Cost St. Louis.................................. 395 $2,424,615 Louisville ................................ 37 293,450 Memphis .................................. 133 - 810,000 Little R ock .............................. 41 74.440 Repairs, etc. Permits Cost 435 $474,240 156 76,800 56 80,000 100 42,158 JULY New Construction Permits Cost 443 $2,883,397 64 258,250 78 667,000 53 251.791 1919 Repairs, etc. Permits Cost 444 $419,140 123 179,965 119 141,150 60 30.425 L IV E STOCK being in sheep. The cause for this was the radical Virtually no change worthy of note has tran slump in prices for dressed lamb and mutton. Some spired in the live stock situation as contrasted with improvement in the demand for stock and feeder a month ago. The movement in and out of St. cattle was reported, attributable to improved condi Louis shows a sharp decline under the correspond ing month last year, with the heaviest relative loss tion of pastures, and a decline in feeds. As reported by the St. Louis National Stock Yards, receipts and shipments of live stock at St. Louis in July, with comparisons for July, 1919, were as follows: Cattle and Calves 1920 1919 Receipts ............................................... 114,437 138,609 Shipm ents............................................. 52,713 81,059 Hogs 1920 1919 196.466 232,090 103,778 339,830 Sheep 1^2" 1919 82,757 136,962 21,411 64,427 Horses and Mules 1920 1919 8,893 15,535 10,229 24,623 F IN A N C IA L part of railroads to increase transportation efficiency No marked changes in financial conditions in the district occurred during the past month. There is and expedite the crop movement are expected to be a continued broad demand for money and credits, reflected shortly in the release of enormous credits with the call from the country particularly urgent. heretofore tied up in delayed freight. To the South, There has been some liquidation in loans, and where the old crop cotton has not been sold, banks during the past week or ten days certain coun have been obliged to carry a heavy burden, but try banks have slightly reduced their obligations. withal financing of the growing crop has been The trend of deposits is normal for this time of adequately handled. Rates are high, and present year. Sharp price reductions in some staples indications are that there w ill be little change. have had a tendency to promote liquidation Commercial paper houses report extreme dullness of accumulated stocks. Thus far the massive in their line, July and August business being we requirements for crop financing have been met, under that of preceding seasons. Country bank* and requirements of essential business are being are buying sparingly, and the large city institutions well cared for. Concensus of opinion among are too closely pushed to supply regular and routine bankers is that with a continuance of the demands of their customers to invest in paper o recent conservative policy in the matter of appor this class. Some paper has sold fractionally above tioning credits and the discouragement of specula 8 per cent, but the prevailing rate is still 8 per cen , tion in all forms, general business can be carried with no names, how ever good, obtaining concession without serious disturbance until the return Digitizedforward for FRASER How of money begins in the fall. Efforts on the under that Agure IN T E R E S T RATES Between July 16 and A ugust 15 the high, lo w and customary interest rates prevailing in St. Louis, Louisville, and Little R ock, as reported by the banks in those cities, were as follow s: St. Louis L C Louisville H L C Little Rock H L C 7 7 6 6 6 6 6 6 8 8 7 7 7 7 8 8 6 8 8 6 8 8 6 7 6 7 1H Customers' Prime Commercial Paper: 4 to 6 months................................................................ Prime Commercial Paper purchased in open market: 30 to 90 days................................................................ 4 to 6 months................................................................ Loan to other banks.......................................................... Bankers' Acceptances of 60 to 90 days: Loans secured by prime stock exchange collateral or other current collateral: 7'4 7!4 7 6% 6K 6% 6K 7 7 6% 6% 6'4 7^ 6% 6% 6% 6H 6% 6 7 7 7 7 / / 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 6 -7H .7'/; 3 mon 3 to 6 Cattle Loa 6% 6% -7% 7 ... 8 8 8 8 8 8 7 7 7 7 7 7 8 7 7 8 8 7 CO N D ITIO N OF BANKS The condition o f banks in this district, and changes since a month ago and last year, are reflected in the follow in g com parative statement, showing the principal resources and liabili ties o f member banks o f St. Louis, Louisville, Memphis, Little R ock and Evansville: \ug..!3.1920________Ju!y 16, 1920________ Aug. IS. 1919 Number of banks reporting................................................. 3$ 35 34 U. S. Bonds to secure circulation......................................$ 16,924,000 $ 16,925,000 $ 17,155,000 Other U. S. Bonds, including Libertv Bonds................. 13,295,000 13.250,000 16,167,000 U. S. Victory N otes............................................................ 2,675,000 2,781,000 11,681,000 U. S. Certificates of Indebtedness.................................... 5,036,000 6,137,000 35,050,000 T o ta iu . S. Securities ow ned......................................$ 37,930,000 Loans and investments, including bills rediscounted with F. R. Bank: Loans secured by U. S. War Obligations........................ $ 33,534,000 Loans secured by stocks and bonds other than U. S. Securities ........................................................................ 125,744,000 At! other loans and investments........................................ 410,891,000 $ 39,093,*000 $ 80,053,000 $ 35,564,000 123.542.000 409.422.000 Total loans and investments, including rediscounts with F. R. Bank.......................................................<608.099,000 $607,621,000 $526,015,000 Reserve with the Federal Reserve B a n k .....................$ 41,138,000 9,390,000 Net demand deposits on which reserve is computed___ 330,212,000 T'me deposits.......................................................................... 124,767.000 Government deposits............................................................ 1.564.000 $ 39,630,000 9.456.000 321.327.000 124.596.000 3.308.000 $ 39,482,000 11.707.000 318,502,000 99.911.000 22.464.000 Cash in vault............................................................................ D EBITS TO IN D IV ID U A L ACCOUNTS The follow in g table, com piled from figures furnished by the several clearing houses, gives the total debits charged by banks to checking accounts, savings accounts and trust accounts of individuals, firms, corporations and U. S. Government, also certificates of deposit, cashiers' checks and expense checks paid, in the leading cities o f this district during the past month, with com parisons for the preceding month and corresponding period a year ago. Charges to accounts of banks and bankers are not included. These figures are considered the most reliable index available for indicating actual spending by the public during the periods which they cover. debits to depositors* accounts for four weeks ending ............................................................................. Aug. 11,1920 Louis................................................................................... $604,071,000 ^utsvtllc ............................. ...... 132,153,000 104.096,000 30,551,000 19,721,000 Memphis ........................................ ............... Lutle Rock.............................. ............... Evansville ............................................................................... Total ................................................................................$890,592,000 July 14.1920 $585,045,000 142,105.000 114,431,000 37,838,000 21,957,000 Aug. 13,1919 $901,376,000 $853,668,000 121,273,000 104,048,000 32,176,000 19,617,000 F E D E R A L R E SE R V E O P E R A T IO N S There were no changes in the norma! discount rates o f the Federal Reserve Bank of since last report. On A ugust 18, 1920, the rates were as fo llo w s : 15 days 16 to M EM BER B A X K S' C O L L A T E R A L N O TES: andless 60days Secured by Certificates of Indebtedness except 5% and 5%% C ertificates........................................................................................... - y e t .......... W holly secured by 5% % Certificates of Indebtedness................... ................................... W holly secured by 5%% Certificates of Indebtedness................... 5}%% .......... Secured by Liberty Loan Bonds or Victory N otes........................... 5% % .......... Secured by Bills Receivable.................................................................... 6% .......... R ED ISC O U N TS: Secured by Certificates of Indebtedness except 5% and 5%% C ertificates.......................................................................................... W holly secured by 5%% Certificates of Indebtedness................... 5% % W holly secured by 5%% Certificates of Indebtedness................... 5%% Secured by Liberty Loan Bonds or Victory N otes........................... 5H% Commercial Paper.................................................................................... 6% Agricultural or Livestock Paper.............................................................. 6% Trade Acceptances..................................................................................... 6% Bankers' Acceptances............................................................ ................... 5% % Bankers' Acceptances purchased in the market, subject to agreement. St. Louis 61 to 91 days 90davs to6months 5% % 5% % 5% % 6% h% 6% 5% % ........ ........ ........ ........ ........ ..... ....... ........ ........ ........ 5!^% 5% % 6% 6% 6% 5^4% 6% ....... ........ In July the Federal Reserve Bank of St. L ou is discounted a total o f $192,843,408 o f paper for 287 m em ber banks, which is an increase o f $14,666,873 over the amount discounted in June, and a decrease o f 10 in the number of banks accom m odated. A cceptances purchased in the open market during July amounted to $2,040,770, which is a decrease o f $1,174,721 under the preced ing month. T h e resources and liabilities of the Federal Reserve Bank of St. Louis on A u gust 13, 1920, as com pared to a month ago and a year ago, are show n in the follow in g statem en ts: July 16,1920 $ 3.340.000 5.808.00!) 5.242,000 Aug. 15,1919 $ 2,686.000 32,030,000 Total gold held by bank..............................................................$ .$ 18.266.000 18.266.000 $ 14.390.000 $ 34,716,000 .$ 44,303,000 . . 6.474.000 $ 45.358,000 5.304,000 $ 56.890,000 5.181,000 Total Gold Reserves.......................................................................3$ 69.04J.000 69.043.000 Legal Tender, Notes, Silver, etc.........................................................$ .$ 8,066,000 $ 65.052.000 $ 96.787.000 $ $ RESOU RCES: Gold Coin and Certifies Gold Settlement Fund- Total Reserves................................................................ Aug. 13,1920 .$ 2,997,000 . 10,027.000 5,242,000 ............. .$ $ 77,109,000 77,109,000 .$ 41,547,000 . 70,212,000 2,160.000 Total Bills on Hand.........................................................................$113,919,000 $113,919,000 .$ !,! 53,000 . 17,257.000 7,351,000 4,542,000 $ 72.403.000 $10!,329,000 $ 49,002.000 60.672,000 3.071,000 $ 53,513,000 9.224.000 9.817.000 $112,745,000 $ 72,554.000 $ 1,153,000 17.068.000 $ 1,153,000 17,228,000 Total Earning Assets......................................................................$132,329,000 $132,329,000 Bank Premises.............................................................. ...........................$ 866.000 Uncollected Items and other deductions from Gross Deposits.... 44,890.000 5% Redemption Fund against F. R. Bank N otes................. 524.000 All Other Resources.................................................................... 342.000 $131,126,000 866,000 49.505,000 525,000 285,000 $ 90.775,000 $ 69*.000 51.030.000 840.000 490.000 Total Resources................................................................................$256,060,000 $256,060,000 $254,710,000 $245,155,000 $ $ $ L IA B IL IT IE S : .$ 4,272,000 5,884,000 4.257,000 5.884,000 3,943,000 2.589.000 833,000 64,993,000 39.542.000 1,600,000 1.792,000 62.297.000 41.788,000 1,608,000 6.205.000 61.361.000 43.257.000 4.366.000 Total Gross Deposits.......................................................................$106,968,000 $106,968,000 F. R. Notes in actual circulation................................................ . $128,262,000 F. R. Bank Notes in actual circulation...................................... 8.864.000 Al! Other Liabilities................................................................................. L810.000 1,810,000 $107,485,000 $115,189,000 $127,121,000 8,630,000 1,333,000 $106,387,000 16.305.000 742,000 $254,710,000 $245,155,000 Government Deposits. Due to Members—Res( . Tota! Liabilities........................................................................................$256.060,000 $256,060,000 Contingent liability as endorser on paper rediscounted with or sold to other F. R. Banks............................................................... $ 20,941,000 Contingent liability on bills purchased for foreign correspondents 752,000 (Compiled August 18. 1920) $ 24.220,000 752,000
@FedFRASER