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MONTHLY REVIEW O f Agricultural, Industrials Trade and Financial Conditions in the Eighth Federal Reserve District Released for Publication On and After the Afternoon of December 30, 1931 J O H N S. W O O D , Chairman and Federal Reserve Agent FEDERAL RESERVE X T R E M E conservatism in purchasing of commodities by the general public, mer chants and other groups of consumers was reflected in a further recession in trade and industri al activities in the Eighth Federal Reserve District during the past thirty days. With the single excep tion of dry goods, all wholesaling and jobbing lines investigated by this bank showed a smaller volume of dollar sales in November than for the preceding month, and without exception decreases were re corded as compared with November, 1930, and the average for the month during the past eight years. Relatively a better exhibit was made by distribu tion than production, the rate of operations at manu facturing plants as a whole being slightly below that of the preceding month, and considerably less than during the corresponding period last year. In the chief industrial centers the reduced rate of manu facturing activity was reflected in a further increase of the number of idle workers during November and early December, offset partly, however, by a gain in clerical employment at retail establishments in cident to the holiday trade. E The trend of commodity values continued downward, with a number of important classifica tions reaching new lows on the present retrograde movement. This served to emphasize caution in the matter of purchasing, particularly of raw materi als for future requirements. Producers and distribu tors of pig iron, finished iron and steel products, non-ferrous metals, lumber, and a number of other important commodities report ordering for first quarter of the new year in smaller volume than any similar period in recent times. The same attitude prevails in lines for ordinary consumption, purchas ing being confined largely to only enough merchan dise for immediate or nearby requirements. This policy has resulted in generally small inventories, both in the hands of manufacturers and merchants. While as compared with last year average sales volume has declined heavily, the lower range of prices prevailing now accounts for a considerable C. M . STEW ART. Assistant Federal Reserve Agent BANK OF ST. J. V I O N P A P IN , Stfltiitlcian LOUIS part of the decrease. It thus becomes evident that the unit volume of distribution makes a much more favorable showing than the dollar volume, also that large quantities of merchandise continue to flow through distributive channels. As has been the case since early fall, the unus ually high temperatures prevailing throughout this region have seriously interfered with the movement of seasonal merchandise, particularly fuel, heavy wearing apparel and heating apparatus. November production of bituminous coal in fields of the dis trict was substantially below the average for that month during the past decade. Christmas holiday shopping got a later start than usual, and during November and the first week of December failed to gain the expected momentum. In both the large centers of population and smaller communities, de mand centers chiefly in cheap-priced merchandise. Since the first week of December considerable im provement has developed in purchasing of holiday goods, a number of important interests reporting volume comparing favorably with a year ago. The report of the U. S. Department of Agri culture as of December 1 showed no marked change in general conditions as contrasted with a month previous. Earlier forecasts of heavy yields and high quality of the principal crops of this district are con firmed in the bulletin. As an offset to large outputs, however, has been the further decline in market prices of farm products. A large part of the advance in prices of cereals achieved in November was lost during the first half of December. In the immediate past prices of cattle, sheep and hogs have fallen to the lowest point of the season and for a number of years. Opening of the tobacco markets in early December developed prices considerably below those recorded at initial sales last year. Several of the markets were temporarily closed because of un willingness of farmers to accept prices offered. There was an advance from the low point of the season in rice prices, and the position in this cereal is favorable, due to marketing methods and demand. Reversing the usual seasonal trend, the volume of retail trade in November, as reflected in sales of department stores in leading cities of the district, was 4 per cent smaller than in October. The Novem ber total fell 10.4 per cent below that of a year ago, and for the first eleven months this year a decrease of 12.7 per cent was shown as compared with the same period in 1930. Combined sales during Novem ber of all wholesaling and jobbing firms reporting to this bank were 4.6 per cent smaller than in the preceding month, and approximately 8 per cent less than for the same month in 1930; for the first eleven months this year the aggregate was 15.6 per cent below that for the same period in 1930. The value of permits issued for new buildings in the five largest cities of the district in November was 64 per cent and 60 per cent smaller, respectively, than a month and a year earlier. Construction contracts let in the Eighth District in November were onefifth smaller than the low October total, and 61 per cent less than in November, 1930. Debits to check ing accounts in November fell 16 per cent below October, and 22 per cent below the November, 1930, total; for the first eleven months this year the aggre gate was 21 per cent smaller than for the same period in 1930. The amount of savings accounts held by selected banks decreased slightly between November 4 and December 2, and on the latter date was about 5 per cent smaller than on December 3, 1930. According to officials of railroads operating in this region, freight traffic handled continued the downward trend of recent months, and the Novem ber total fell substantially below that of the cor responding period in 1930 and 1929. There was a particularly heavy decrease in merchandise and mis cellaneous freight. As was the case during the pre ceding month, the movement of coal, coke and other fuels was held down by the unusually mild weather and was in considerably less than the seasonal vol ume. For the country as a whole, loadings, of rev enue freight for the first 48 weeks this year, or to November 28, totaled 34,999,149 cars, against 43,096,392 cars for the corresponding period in 1930 and 49,489,591 cars in 1929. The St. Louis Terminal Railway Association, which handles interchanges for 28 connecting lines, interchanged 132,895 loads in November, against 144,833 loads in October, and 166,395 loads in November, 1930. During the first nine days of December the interchange amounted to 40,976 loads, which compares with 46,993 loads during the same period in November and 47,235 loads during the first nine days of December last year. Passenger traffic of the reporting lines in November decreased 26 per cent as compared with the same month in 1930. Estimated tonnage of the Federal Barge Line between St. Louis and New Or leans in November was 86,400 tons, against 104,873 tons in October, and 83,000 tons in November, 1930. Little change in the general trend, noted during the past several months, was reflected in reports rel ative to collections. Considerable irregularity and spottiness exists, both with reference to the several lines and different localities. For the most part wholesalers in the chief distributing centers reported early December settlements in considerable volume, a number of important interests indicating better re sults than a year ago. The relatively small inven tories of retail merchants and the policy of handto-mouth buying lend themselves to prompt defray ing of bills. In the clothing line there were com plaints of backwardness, and the same was true of building materials and some of the other heavier classifications. Country retailers report moderate betterment in collections as contrasted with earlier in the season. There has been considerable liquida tion in the tobacco and rice areas, also in parts of the typical cotton sections, though the disposition of producers to hold their stocks for higher prices is still holding down payments as a whole in the country. Questionnaires addressed to representa tive interests in the several lines scattered through the district show the following results: E xcellent Good Fair P oor November, 1931......... 0% 18.5% 67.5% 14.0% October, 1931......... 0 21.1 56.4 22.5 November, 1930......... 0 10.0 65.0 35.0 Commercial failures in the Eighth Federal Re serve District in November, according to Dun’s numbered 117, involving liabilities of $3,357,116, against 126 failures in October with liabilities of $2,497,736, and 92 defaults for a total of $3,870,162 in November, 1930. The average daily circulation in the United States in November, was $5,518,000,000 against $5,478,000,000 in October and $4,528,000,000 in November, 1930. M AN U FACTU RIN G AN D W H O L E S A L IN G Boots and Shoes — November sales of the re porting firms showed a gain of 2.8 per cent over the corresponding month in 1930, but a decrease of ap proximately 3 per cent under the October total this year. There was a further shrinkage in inventories, stocks on December 1 being 5.5 per cent and 6 per cent smaller, respectively, than thirty days and a year earlier. Since December 1 some falling off in orders has taken place, which, however, is seasonal in character, November and December being nor mally the quietest months of the year in this line. Effective December 1 a decrease in prices of from 5 to 7 per cent was announced by several of the lead ing interests. This reduction was made in order to pass along to customers the advantage of lower raw material values. Factory operations were at about 70 per cent of capacity. Clothing — The steady recession in volume which has characterized the apparel business throughout the year, continued during the past thirty days. Unseasonable weather has adversely affected the movement of winter clothing, and in both men’s and women’s wear demand centers chiefly in cheap-priced merchandise. Demand for working clothes was almost at a standstill. Manu facturers report advance ordering for spring wear below the small volume at the corresponding period a year ago. Sales of the reporting firms in Novem ber were 21 per cent smaller than during the pre ceding month and about one-fifth less than in November, 1930. Drugs and Chemicals — Purchasing of seasonal goods in this classification was considerably below the average in recent years. This, coupled with the usual seasonal recession in requirements of heavy drugs and chemicals by the general manufacturing trade, was reflected in a decrease in November sales of the reporting firms of 12.5 per cent as compared with the preceding month, and of 18 per cent as compared with November, 1930. Inventories in creased 3 per cent between November 1 and Decem ber 1, but on the latter date were approximately 2.5 per cent smaller than a year earlier. Dry Goods — November sales of the reporting firms in this classification were 2.2 per cent larger than for the preceding month, but 5.2 per cent small er than in November, 1930. The steady decline in inventories which has been in operation throughout the year, continued in November, stocks on Decem ber 1 being 12 per cent and 40 per cent smaller, respectively, than thirty days and a year earlier. Demand for seasonal goods, notably blankets, out ings, woolens, and heavy underwear was held to a minimum by the mild weather. Ordering of goods based on cotton was restricted by uncertainty of prices of that staple. Advance sales of holiday goods were light, though in the immediate past some reor dering to supply eleventh hour demand has been reported. Electrical Supplies— Purchasing of holiday and seasonal goods, according to the reporting firms, has been smaller during the past two months than during any similar period in recent years. Curtailed activities in the building industry and conservative buying by public utilities companies and the auto motive industry were additional influences making for reduced sales volume. The trend of prices was easier, notably on commodities based on copper, lead and zinc. A considerable shrinkage as com pared with a year ago was noted in radio materials. November sales of the reporting firms were 37 per cent smaller than for the same month in 1930, and 15 per cent below the October total this year. Inven tories increased slightly between November 1 and December 1, but on the latter date were 19 per cent smaller than a year ago. Flour — Production at the twelve leading mills of the district in November totaled 272,264 barrels, the smallest, with the exception of last June, for any month since 1926, and comparing with 305,335 bar rels in October, and 389,804 barrels in November, 1930. Demand generally continued slow, particular ly for the better grades of flours, which are dis criminated against in favor of cheaper and less desir able descriptions. Dealers and the large baking interests continue to purchase on a hand-to-mouth basis, and in all quarters there is a disposition to hold down inventories as low as possible. Prices were lowered early in December in adjustment with the decline in cash wheat values. Mill operations were at from 40 to 45 per cent of capacity. Furniture — November sales of the reporting interests were 16 per cent smaller than for the same month in 1930, and about one-third less than the October total this year. Stocks decreased slightly between November 1 and December 1, and on the latter date were only about one-half as large as a year ago. Demand for radio cabinets and the gen eral run of holiday goods was in smaller volume than in a number of years. Groceries — A further recession in business in this classification was noted, November sales of the reporting firms being 11.2 per cent smaller than dur ing the preceding month, and 15.2 per cent less than the November total last year. Demand centers chiefly in staple lines, purchasing of luxuries and holiday goods being relatively light. In the rural areas sales of canned goods, packinghouse products and similar commodities are considerably below the seasonal volume, due partly to the unusually large amount of canning and preserving done in homes during the year. Abundant and cheap supplies of fresh fruit and vegetables have also contributed to a lessened demand for canned goods. Hardware — Depressed prices of farm products, the decline in building activity, and unseasonably warm weather were mentioned as the chief causes for a further shrinkage in the volume of business in this classification. Sales of winter goods, notably sports equipment, hunting supplies and heating ap paratus have been in considerably smaller than the usual volume. The movement of holiday specialties has been below the average of recent years, particu larly the more expensive articles. Sales of the re porting firms in November were one-fifth smaller than for the same month in 1930, and 22 per cent less than the October total this year. Stocks on December 1 were 2 per cent larger than a month earlier, and 18 per cent smaller than on December 1, 1930. Iron and Steel Products — The downward trend in activities in the iron and steel industry in this district, which has been in progress since last spring, continued uninterrupted during the past thirty days. In point of production and shipments by mills, foundries and other ferrous metal working plants, November represented the lowest month of the downward movement. Since December 1 the usual seasonal influences, including inventory retrench ments, have further slowed down the rate of opera tions. Quietness in a number of lines, notably stoves, furnaces, heating apparatus, tubular goods and roofing materials, has been accentuated by the mild, open fall and winter. Purchasers of all classes of materials are still following the hand-to-mouth policy, despite universally small stocks. Specifica tions on goods previously acquired are spotty and in the main below expectations. This is true particu larly of releases by the automotive industry. Steel mills report a further shrinkage in unfinished orders, while jobbing foundries were operating at the low est average rate in many months. Certain specialty makers, including farm implement and heating ap paratus, which had planned to resume operations early in December, have further postponed putting these programs into effect. Aside from tinplate, fair tonnages of which have been taken for 1932 require ments, demand for sheets and plates was at the low point of the season. No change has taken place in the dull conditions obtaining earlier in the year in wire and wire products; bars, strip, and kindred materials. Fabricators of iron and steel structural materials report a lack of new business, and a fur ther reduction in working forces. Ordering of raw materials for first quarter of 1932 requirements is in unusually small volume, particularly in the case of pig iron, scrap iron, and steel. Nominally the price of pig iron remained unchanged, but quanti ties, particularly of basic iron, changing hands were too small to afford a real test of the price structure. Scrap prices declined further, with a number of im portant grades recording new lows on the move ment. For the country as a whole the daily average rate of pig iron production in November was the lowest since 1921. Total output amounted to 1,101,820 tons, against 1,172,781 tons in October and 1,865,458 tons in November, 1930. Steel ingot pro duction in the United States in November totaled 1,593,684 tons, against 1,592,376 tons in October, and 2,212,220 tons in November, 1930. A U TO M O BILES Combined passenger car, truck and taxicab pro duction in the United States in November totaled 68,867, against 80,142 in October and 129,437 in November, 1930. In accord with the seasonal trend, distribution of automobiles in this district during November, according to dealers reporting to this bank, declined as compared with the preceding month. For the eleventh consecutive month this year, the Novem ber total fell below that of the corresponding month a year earlier. The decline in the month-tomonth comparison was slightly smaller than the average, due chiefly to the small volume recorded in October. Aggregate sales of the reporting deal ers in November were the smallest since last Janu ary. While decreases in both the month-to-month and yearly comparisons were spread generally through all classes of makes, they were most pro nounced in cheap-priced cars. This fact was ascribed by dealers partly to the fact that prospective pur chasers are putting off buying until expected new models of the two leading makers are placed on the market. Despite the relatively small volume of business transacted, sentiment was somewhat more optimistic than heretofore. This change in attitude was based mainly on expectations of heavy sales of the new models which will be offered by manu facturers shortly after the first of next year. These new models offer many striking improvements and prices, which, it is believed, will attract purchasers. Since December 1 special efforts and inducements have been made by dealers to dispose of stocks of 1931 models, resulting in the movement of a con siderable number of such vehicles. November sales of new passenger cars by the reporting dealers were 11 per cent smaller than in October, and approxi mately 9 per cent less than the November total last year. Due to the extremely conservative attitude of dealers in ordering from the factories, inventor ies of new cars on hand decreased to the lowest point in recent years. Stocks on hand on December 1 were 6 per cent smaller than a month earlier, and about one-fourth smaller than on the same date in 1930. Little change took place in the used car mar ket as contrasted with the preceding thirty days. November sales were 2 per cent less than in October and 12 per cent smaller than in November, 1931. Stocks of salable secondhand cars on December 1 were 3 per cent larger than a month earlier and 12 per cent less than on December 1, 1930. Demand for trucks of all descriptions held fairly well, November sales being 25 per cent larger than in October, but 40 per cent below November last year. Business in parts and accessories was in slightly smaller volume than during the preceding month. The unit volume of tire sales showed a moderate increase over the preceding thirty days, being stim ulated by price reductions made by a number of the leading manufacturers. Deferred payment sales of dealers reporting on that item constituted 53 per cent of the total November sales, against 51 per cent in October, and 49 per cent in November, 1930. RETAIL TRADE The condition of retail trade is reflected in the following comparative statements showing activi ties in the leading cities of the district: Department Stores N et sales com parison Stocks on hand N ov. 193111 months ended N ov. 30,1931 com p, to N ov. 30, 1931 to com p, to N ov. 1930 sam eperiod 1930 N ov. 30,1930 Evansville ........— 23.6% — 22.2% — 18.3% L ittle R ock .......— 18.8 — 15.7 — 25.6 — 15.4 — 20.6 Louisville ........— 13.1 M em phis .......... — 15.6 — 18.4 — 27.1 Q u i n c y ................... _ 9 .8 — 19.7 — 21.9 St. L ou is.......... — 7.3 — 10.4 — 12.9 Springfield, M o — 27.6 — 14.4 — 6.0 — 12.7 — 17.4 8th D istrict......— 10.4 Stock turnover Jan. 1 to N ov. 30, 1931 1930 1.70 1.82 2.38 2.28 2.46 2.50 2.80 2.64 2.28 2.33 3.38 3.42 1.54 1.56 3.03 3.01 Retail Stores N et sales com parison Stocks on hand N ov. 1931 11 months ended N ov. 30,1931 com p, to N ov. 30, 1931 to com p, to N ov. 1930 sam eperiod 1930 N ov. 30,1930 M en’ s Furnishings — 16.5% Boots and Shoes......— 25.9 Stock turnover Jan. 1 to N ov. 30, 1931 1930 — 9 .3 % — 8.6% 2.86 2.75 — 19.8 — 13.2 2.58 2.74 BUILDING In point of dollar value, permits issued for new construction in the five largest cities of the district in November were 64.4 per cent smaller than in October, and smaller by approximately 60 per cent than in November a year ago. According to statis tics compiled by the F. W . Dodge Corporation, contracts let in the Eighth Federal Reserve District in November amounted to $5,996,183, which com pares with $7,538,340 in October, and $15,529,723 in November, 1930. Production of portland cement for the country as a whole in November totaled 8,161,000 barrels against 10,762,000 barrels in Octo ber, and 11,098,000 barrels in November, 1930. Building figures for November follow : E vansville .. Little R ock L ouisville .. Mem phis .... St. Louis.... N ew Construction Permits ♦Cost 1931 134 17 33 176 204 N ov. totals 564 779 O ct. totals 727 973 Sept. totals 817 1,414 *In thousands of dollars $ 509 $1,271 1,429 1,283 1,692 2,959 (000 om itted). Repairs, etc. Permits ♦Cost 1931 1930 1931 1930 46 27 $ 72 $ 6 8 430 704 677 8 49 74 145 72 34 288 $ 348 279 249 $408 462 420 CONSUMPTION OF ELECTRICITY Public utilities companies in the five largest cities of the district report consumption of electric current by selected industrial customers in Novem ber as being about 17 per cent smaller than in Octo ber and 4.3 per cent less than in November, 1930. Detailed figures follow : O ct. N o. of N ov. 1931 Custom 1931 ers ♦ K .W .H . ♦ K .W .H . 2,040 Evansville .... 40 1,498 1,548 L ittle R ock.. 35 1,249 5,369 6,319 Louisville .... 85 2,237 1,472 Memphis ..... 31 14,788 17,334 24,376 29,478 Totals ..........355 *In thousands (000 om itted). N ov. N ov. 1931 1930 com p, to O ct. 1931 ♦ K .W .H . 1,728 — 26.6% 1,428 — 19.3 6,479 — 15.0 1,868 — 34.2 13,968 — 14.7 25,471 — 17.3 N ov. 1931 com p, to N ov. 1930 — 13.3% — 12.5 — 17.1 — 21.2 + 5.9 — 4.3 AGRICULTURE Weather was variable and less favorable for agricultural operations than during the preceding thirty days, and in some sections farm work was interfered with by heavy rains. Due to the unusu ally auspicious conditions for outdoor work during October and early November, however, autumn and early winter routine has been brought well up to the seasonal average of the past several years. While heavy roads and muddy fields in many localities have occasioned some delay, the general movement of farm products to market has been in considerable volume. There is still a disposition on the part of farmers to hold their grain stocks for higher prices, and this policy has become more in evidence since the recent decline in values, following the upturn in November. The tobacco markets opened in early December with liberal offerings on hand, but prices so low that farmers in some sections forced suspen sion for one week. When selling was resumed, bids of purchasers were even lower than those made at the opening of the season. The December 1 report of the U. S. Department of Agriculture confirmed the earlier forecasts for heavy yields of all the principal crops in this dis trict. The extraordinarily large production will serve to partly offset the low prices prevailing, and taken as a whole, conditions in the agricultural areas at this time are somewhat more favorable than a year and two years ago. Conditions in the live stock market were adverse to producers. Due to the continued mild weather, the business depression and generally reduced buying power, prices of cattle, hogs and lambs declined to new low levels on the present retrograde movement. Heavy shipments from the country since December 1 created supplies too large for current requirements, with resultant sharp decreases in prices. In view of the drop in values and heavy refrigerator stocks of meat, com mission men and officials of live stock exchanges are urging farmers and stockmen to curtail their shipments until the situation clears. Corn — Except where temporarily delayed by rain, husking and cribbing of corn has been pushed forward rapidly throughout the district, and as a whole these operations are more nearly completed than at the same time last year. Almost universally, husking returns are confirming earlier estimates of quantity and quality. A considerable portion of the corn arriving at primary centers is grading high, more than the usual amount being No. 1 and No. 2. Winter Wheat — The condition of the growing crop is generally favorable in all sections of the dis trict. Continued high temperatures, with ample pre cipitation have resulted in good root and top growth, and the plant is in excellent condition for entering the cold weather. Seeding was carried further into the season than is ordinarily the case, but while farmers were for the most part able to carry out their full planting intentions, indications point to smaller acreage than last year, particularly in the most important wheat producing counties. Live Stock — Due to the mild, open winter, abundance of feed and good pasturage, the condition of livestock generally through the district main tained the high condition noted during the preced ing several months. Shipments of stocker and feeder cattle, inspected at livestock markets, into the eleven Corn Belt states in November were slightly larger than in the same month last year, but a little smaller than the November average for the preceding five years. This is in contrast to the decrease of 11 per cent in shipments in October and 17 per cent in September this year compared with the same months in 1930. Prices of such cattle advanced during November, which is contrary to the usual trend at this time of year. Since December 1 a recession in prices has taken place. Total shipments for the five months, July to November, inclusive, into the Corn Belt states were practically the same in 1931 as in 1930, but were below any other year since 1920 except 1927. The states of the Eighth District where the largest increases over last year took place were Indiana, Illinois and Missouri. Receipts and shipments at St. Louis as reported by the National Stock Yards, were as follows: R eceipts N ov. O ct. N ov. 1931 1931 1930 Cattle and Calves..... 88,177 122,408 87,891 H ogs ............................245,061 238,246 273,429 Horses and M ules...... 2,479 2,741 2,208 Sheep ............................ 41,649 64,087 29,808 Shipments N ov. Oct. N ov. 1931 1931 1930 58,048 87,449 55,956 200,827 189,186 223,734 2,342 2,867 1,847 8,501 19,708 7,289 Cotton — According to the U. S. Department of Agriculture there was practically no variation in cotton prospects in states included in the Eighth District between November 1 and December 1. Combined total yield in Arkansas, Mississippi, Mis souri and Tennessee, based on the December 1 con dition, is estimated at 4,455,000 bales, which com pares with 2,866,000 bales produced in 1930 and 4,085,000 bales in 1929. Almost universally the grade is high and staple excellent. The first half of November witnessed a continuance of the favora ble harvesting conditions which obtained in October. The last weeks of November were wet and less fav orable, but rarely in the past has there been a more auspicious picking season than in 1931. The quantity stored on farm premises is in considerably larger volume than is ordinarily the case. Taken as a whole the 1931 crop season was extraordinarily fav orable for the production of cotton. The one draw back has been the extremely low prices which have prevailed since the marketing season began. During the past thirty days there was a slight advance from the low point reached in early October, but the aver age continued much below that for the same period in a number of years. In the St. Louis market the middling grade ranged from 5.40c per pound be tween November 16 and December 15, closing at 5.70c on the latter date, which compares with 6c on November 16 and 8%c on December 15, 1930. De spite the holding movement, the movement of cot ton to date is well in excess of a year ago. Receipts at Arkansas compresses from August 1 to December 11 totaled 1,079,820 bales, against 699,878 bales for the corresponding period last year. Stocks on hand as of December 11 were 691,563 bales, against 616,817 bales on November 13, and only 375,454 bales on the corresponding date in 1930. Tobacco — Weather during the last half of November was favorable for working tobacco, and stripping progressed rapidly. Liberal offerings were received at the various markets when they opened in early December. Initial prices were disappointing to producers, and considerably lower than a year ago. The average price at the opening at Owens boro was $4.61 as compared with $8.47 per 100 pounds at the opening last year. Following the opening in the Green River district, all sales were rejected and selling suspended for a time. Upon resumption of operations, prices were even lower than those obtained when the markets opened. The loose leaf markets for sale of burley tobacco opened on December 7, with the floors heavily stocked. Prices here were also lower than last year, and the same conditions prevailed as at the opening of the Green River dark tobacco markets. The average price of burley ranged from $9 to $13, per cwt., about $3 less than last year. There were many reports of common tobacco selling for scarcely enough to de fray warehouse charges. Commodity Prices — Range of prices in the St. Louis market between November 16, 1931 and De cember 15, 1931, with closing quotations on the lat ter date and on December 15, 1930, follow: H igh W heat D e c....................... per bu..$ .5 9 f£ $ .63*6 M ay ..................... “ July ..................... “ .55*4 N o. 2 red winter “ .63 N o. 2 hard “ “ .61 Corn D e c ......................... “ .45H .50 M a y ..................... “ July ..................... “ .42*4 N o. 2 m ixed ..... “ .45*4 N o. 2 white ...... ** .46 Oats .29*4 N o. 2 white ...... “ F lour Soft patent......... per bbl. 4.35 Spring patent...... “ 4.60 M iddling cotton....per lb. .06 H o gs on h oof........per cw t. 5.15 Low .5 0 Y % .52H .49*4 .55*4 .53 Close Dec. 15, 1930 D ec. 16, 1931 $ .75 $ .54*4 .56*4 .7m .69*4 .55*4 .. .57*4@ .58*4 $ .8 1 *4 @ .83*4 .5 5 *4 @ .56*4 .7 7 *4 @ .78 .3**4 ( .38*4 ( .38*4 .4 1 # .42*4 .38*4 .39*4 .25 .26 .26*4 3.60 4.20 .054 3.50 3.60 4.20 .35 .39*4 .40*4 .34*4 .36*4 3.50 ( @ 4 .2 0 @ 4 .5 0 .057 @ 4.25 .71 .75 .71*^4 @ ” .*72*4 .73 *4 @ .74 .35 .35*4 4.70 4.10 @ 5.00 @ 4.50 .08*4 @ 8.35 6.75 Condition of Banks — Loans and discounts of the reporting member banks on December 16, 1931, showed a decrease of 1.8 per cent as contrasted with November 18, 1931. Deposits decreased .2 per cent between November 18, 1931 and December 16, 1931, and on the latter date were 7.7 per cent smaller than on December 17, 1930. Composite statement follow s: ♦Dec. 16, 1931 25 N um ber of banks reporting............ Loans and discounts (incl. rediscounts) Secured by U . S. Govt, obligations and other stocks and bonds............ $155,202 All other loans and discounts.... 235,578 ♦Nov. 18, 1931 25 ♦Dec. 17, 1930 26 $156,699 241,363 $197,879 279,452 FINANCIAL $477,331 $398,062 Total loans and discounts.......... ......$390,780 Investments The general demand for credit in this district 32,345 86,475 U . S. Government securities...... 93,837 130,652 129,405 Other securities............................... 129,920 during the past thirty days was somewhat less ac $162,997 $215,880 Total investments................................$223,757 tive than in the similar period immediately preced 45,840 44,974 Reserve balance with F . R. Bank 42,290 8,567 Cash in vault........................................ 7,218 ing. Requirements of mercantile and manufacturing 7,644 Deposits 373,868 333,052 interests were below the usual seasonal volume. N et demand deposits..................... 341,528 228,834 222,611 Tim e deposits.................................. 208,125 1,193 Liquidation at financial institutions in the large 2,484 Government deposits..................... 7,496 $603,895 centers was relatively more satisfactory than with T otal deposits.......................................$557,149 $558,147 Bills payable and rediscounts with country banks. The disposition to hold farm pro Federal Reserve B ank................. 10,823 11,006 3,214 ♦In thousands (000 om itted). ducts for more favorable markets has tended to These 25 banks are located in St. L ouis, Louisville, M em phis, Little R ock, and Evansville, and their total resources com prise approxim ately retard settlements with banks in the smaller towns. 52.6 per cent o f all m em ber banks in this district. Debits to Individual Accounts — The following This is true particularly in sections where cotton, table gives the total debits charged by banks to tobacco and rice are important crops. Grain and checking accounts, savings accounts, certificates of milling interests further reduced their commitments deposit accounts and trust accounts of individuals, during November and the first half of December. firms, corporations and U. S. Government in leading Demand for currency continued active, being stimu cities of the district. Charges to accounts of banks lated by the holiday trade. Acceptance financing are not included. by banks was light in November, and sales of com N ov., 1931 com p, to ♦Nov., ♦N ov., ♦O ct., mercial paper also declined. Oct. 1931 N ov. 1930 1931 1930 1931 East St. Louis & Natl. A slight decrease in loans and discounts of re — 30.7% $ 28,942 $ 33,496 — 19.2°/ Stock Yards, 111..$ 23,207 — 37.2 4,335 6,281 — 9.1 3,942 El Dorado, A rk ..... porting member banks took place between Novem — 40.8 — 36.0 25,410 23,521 Evansville, In d ..... 15,053 — 24.4 11,764 — 14.7 Fort Smith, Ark.... 8,898 10,435 ber 10 and December 9, and the total of $392,363,000 — 18.5 3,206 4,045 + 2.9 Greenville, Miss.... 3,298 — 15.4 2,785 3,441 + 4.6 Helena, A rk .......... 2,912 on the latter date was approximately 18 per cent — 30.2 32,618 — 18.7 27,988 Little R ock, Ark.. 22,756 — 30.5 126,715 155,957 — 14.5 Louisville, K y ........ 108,342 smaller than at the corresponding time last year. — 5.2 — 13.7 117,434 Memphis, T enn...... 111,305 129,003 Loans on securities increased slightly in the month4,630 — 33.4 5,932 Owensboro, K y ..... 3,950 — 14.7 — 14.4 7,208 — 20.3 Pine Bluff, A rk ..... 9,043 8,418 to-month comparison, but were 41 per cent smaller Quincy, 111............. 7,042 7,843 — 10.2 8,348 — 15.6 — 18.0 St. Louis, M o........ 457,345 — 20.1 572,145 557,697 than a year ago. The sharply downward trend in — 48.4 Sedalia, M o ............ 1,958 3,234 3,793 — 39.5 Springfield, M o ..... 11,475 — 14.0 — 19.6 13,341 14,264 deposits of these banks, which began at the middle ♦♦Texarkana, A rk -T e x ....... 6,675 8,203 — 18.6 10,132 — 34.1 of last April, reached its low point in late October, Totals .....................$795,366 $951,121 $1,023,278 — 16.4 — 22.3 and since that date there has been a definite upward ♦In thousands (000 om itted). ♦♦Includes one bank in Texarkana, Texas not in Eighth District. turn. Investments increased slightly during the Federal Reserve Operations — During Novem month, and continued substantially larger than a ber the Federal Reserve Bank of St. Louis dis year ago. Borrowings of all member banks from counted for 253 member banks against 260 in Octo the Federal reserve bank averaged somewhat higher ber and 225 in November, 1930. The discount rate than during the preceding thirty days, and were in remained unchanged at Zy2 per cent. Changes in considerably larger volume than during the cor the principal assets and liabilities of this institution responding period in 1930. appear in the following table : Interest rates fluctuated in a narrow range, and ♦Dec. 17, ♦Nov. 17, ♦Dec. 17, 1930 1931 1931 quotably showed no marked variation from the pre $15,205 Bills discounted................................................... .$27,833 $24,780 8,513 Bills bought............................................................. 10,258 24,371 ceding month. At St. Louis banks current rates U. S. Securities..................................................... 27,351 31,084 24,418 Federal Inter. Cr. Bk. Debentures.............. 880 630 were as follows: Prime commercial paper, 4)4 to '7 ,2 9 5 Participation in Inv. Foreign B anks............ 1,103 1,103 6 per cent; collateral loans, 4y2 to 6 per cent; loans $49,431 Total bills and securities.................................. $67,425 $81,968 114,410 Total reserves........................................................ 96,068 86,914 secured by warehouse receipts, Al 2 to 6 per cent; / 83,560 F. R. Notes in circulation................................ 86,921 86,127 71,474 Total deposits............................................. .......... 68,600 74,027 interbank loans 5 to 6 per cent and cattle loans, 5y2 Ratio of reserve to deposits. 73.8% and F. R. N ote Liabilities......................... 61.8% 54.3% to 6 per cent. *In thousands (000 om itted ). (Compiled December 29, 1931) BUSINESS CONDITIONS IN THE UNITED STATES Industrial activity and factory employment declined further from October to November, reflecting in part the usual seasonal tendencies. Continued gold imports and fur ther reduction in member bank reserve requirements dur ing November and the first half of December were reflected in a considerable decline in the outstanding volume of re serve bank credit. PRODUCTION AND EMPLOYMENT—In Novem ber industrial production showed a somewhat larger de crease than is usual at this season, and the Board’s season ally adjusted index declined from 73 to 72 per cent of the 1923-25 average. Activity declined at woolen mills, lumber mills, and coal mines, while daily average output at steel mills increased and volume of automobile production showed less than the usual seasonal decline from the low level of October. The November increase in steel production was followed by a considerable decline in the first three weeks of December. Output of petroleum increased further in November to a level slightly lower than that prevailing last summer, before output was sharply curtailed. Volume of employment in most manufacturing industries declined by more than the seasonal amount between the middle of October and the middle of November. Reductions were particularly large in the wearing apparel, leather, and build ing materials industries, while in the automobile and tire industries declines were smaller than usual at this season. The value of building contracts awarded, as reported by the F. W. Dodge Corporation, has declined further in recent months and a preliminary estimate of the Board’s seasonally adjusted index for the last quarter of 1931 is 49 per cent of the 1923-1925 average, compared with 59 for the third quarter, 65 for the second quarter, and 79 for the first quarter of the year; part of this decline in dollar volume Federal Reserve B oard's index o f fa ctory employment with adjustment for seasonal variation. (1923-1925 average= 1 0 0 .) Latest figure N ovem ber, 69.3. reflects lower building costs. Production of principal crops in 1931 was about 10 per cent larger than in 1930, accord ing to the December crop report of the Department of Agri culture, while acreage harvested was slightly smaller than a year ago. There were large increases in the crops of cot ton, corn, winter wheat, apples and peaches, while the har vests of oats, barley and rye were smaller than last year; as in 1930 the hay crop was unusually small. DISTRIBUTION — Commodity distribution continued at about the same rate in November as in October, the volume of freight-car loadings showing a seasonal decline, while sales at department stores increased by about the usual amount for that month. WHOLESALE—The general level of wholesale prices remained practically unchanged from October to November, according to the Bureau of Labor Statistics’ index. Prices of grains, petroleum, and silver advanced, while those of livestock and dairy products showed declines, partly of a seasonal character. Between the middle of November and the middle of December there were decreases in the prices of many leading commodities, including livestock, meats, grains, sugar, silk and silver. During this period prices of 1927 1928 1929 1930 1931 Indexes of daily average number o f cars loaded; ajusted for seasonal variation. (1923-1925 a v e r a g e s 100.) Latest figures N ovem ber, total 68, miscellaneous 83. copper and rubber showed a decline, followed by a recovery. BANK CREDIT — Volume of reserve bank credit out standing declined during November and the first half of December and averaged $360,000,000 less in the week end ing December 12 than at its October peak seven weeks earlier. The decrease was in large part in the banks’ port folio of acceptances, as discounts for member banks and holdings of United States Government securities showed little change for the period. The decline in total volume of reserve bank credit outstanding during the period reflected a growth of $100,000,000 in the stock of monetary gold, largely through imports from Japan, and a continued re duction in the reserve balances of member banks, reflecting a further liquidation of member bank credit. Demand for cur rency declined during the last three weeks of November, and showed considerably less than the usual seasonal in crease in the first haif of December. After the middle of December, however, bank suspensions in new England were followed by some increased withdrawals of currency, part of which has begun to return. Loans and investments of member banks in leading cities continued to decline and on December 9 were $370,000,000 smaller than four weeks ear lier. The decrease was equally divided between the banks’ loans and their investments. Deposits of these banks, both demand and time, also showed a decrease, with a consequent reduction in required reserves. Money rates in the open market showed little change from the middle of November to the middle of December. Rates on prime commercial paper continued at 3^4 to 4 per cent, while rates on 90 day bankers’ acceptances advanced from to 3 per cent on November 25.
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