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FEDERAL RESERVE BANK OF ST. LOUIS MONTHLY REVIEW OF B U SIN ESS CONDITIONS IN FEDERAL RESERVE DISTRICT NO. 8 Released for Publication On and After the Afternoon of January 30, 1924 W I L L I A M M cC. M A R T IN CHAIRMAN OF TH E BOARD AND FEDERAL RESERVE AGENT H E principal change in the aspect of general business in this district during the past thirty days, as reflected by current reports to this bank, is a greater degree of optimism on the part of busi ness men regarding prospects for the next few months. W hile there has been no big increase in activities and conservatism is still the rule in purchas ing commodities, the chief factors which influence comm erce and industry are in the main favorable to a continuance of the conditions which obtained during the closing months of 1923 and gradual betterment as the present year progresses. Manufacturing and wholesale have recovered at a normal rate from the holiday let-down and in some lines, notably iron and steel, there has been slight improvement. The financial and banking situation at the opening of the year displays great strength, employment in both the large cities and smaller communities is at high levels, agriculturists are getting more satisfactory returns on their products, and the purchasing power of the public, as indicated by savings accounts, wage scales and current bank debits, is in a healthy position. Reports relative to the holiday trade were some what uneven, results in certain sections being disap pointing. On the whole, however, things were fully up to expectations and large quantities of goods were moved into consumptive channels. Selections of Christmas shoppers covered a broad variety of mer chandise, with luxuries and the more expensive arti cles making up a relatively large part of the total. Stocks carried over were relatively small, except in the case o f clothing, and special sales held during January have assisted materially in reducing accumu lations in this category. The recent drop in tempera ture, which furnished the first really cold weather of the winter, served to stimulate the movement of sea sonal goods, particularly heavy apparel, foot cover ings, and fuel. Trade in winter wear in the South has been more active than at any time this season, and wholesalers and manufacurers are receiving numerous small fill-in orders, nearly all of which are accompanied by requests for immediate shipment. The end of the inventory period discloses gener ally moderate stocks of both raw materials and finished goods. Manufacturers are purchasing supplies for the first half o f the year with extreme caution and conservatism, and the same attitude is general among wholesalers and jobbers. Future orders on the books of reporting wholesale establishments in almost all lines are considerably smaller than at the corresponding period a year ago. This is true partic ularly o f dry goods interests, whose customers are postponing forward commitments because of uncer tainty relative to raw cotton. Retailers are purchasing heavily, but their orders are frequent and small in size, and there has been no change from the recent T policy of taking only such goods as can be currently disposed of or sold a month or six weeks ahead. Competition in all lines continues keen, and during the past several weeks there has been apparent a resistance on the part of ultimate consumers to the upward price trend in certain textiles. W ith the exception of cotton goods, however, the period under review was marked by an absence of wide price flutuations in manufactured products. There were the usual seasonal changes in certain food products, and advances were scored in some grades of lumber, lead and zinc, gasoline and several items in the drug and chemical list. The trend of cereal values was upward, with corn recording a sharp ad vance in the St. Louis market. Between December 15 and January 15, May corn advanced 6 }ic per bushel and cash corn 4c. The wheat options were unchanged to 1c higher, but cash wheat was 4c to 4 ^ c higher. July oats were 2^4 c higher and No. 2 white oats in the cash market 4c higher. Middling cotton in the St. Louis market fluctuated between 34c and 35% c, the high point being reached toward the close of December. A decline took place during the second week in January, and the close on January 15 was 34c, which was c under the final quotation on D ecem ber 15. Only minor changes occured in the employment situation during the past thirty days. A ccording to the Employment Service of the Department of Labor, unemployment was no greater than normal for this season. Tem porary idleness resulted from the closing down of industrial plants for inventory and repairs. The outstanding feature was a rather sharp curtail ment in forces employed at railroad shops, but it should be remembered that capacity forces were em ployed in the shops until a short time ago. Cold weather caused some slackening in building activities, especially outside of St. Louis, and road construction is off to some extent, but still absorbs much com m on labor. Meat packing establishments, flour mills and other manufacturing plants are running at normal, and the holiday trade furnished employment for many persons. Dom estic help is scarce. Some reduction was reported in the number of men employed in the operating departments of railroads. The drop to zero temperatures had a decidedly stimulating effect on the fuel situation, which for the first time in a number of months has been brought to a status approximating normal for the season. Dealers have been able to empty their yards, and have placed fair orders with mine operators. Operations in both the Illinois and Kentucky fields have been increased, and activities have been resumed at some pits which had been closed. M any industrial consum ers of coal who had postponed purchasing on account of the inventory period have been forced into the market, and a scarcity of screenings has developed in some quarters. Prices generally have not been mater ially affected, though the market displays a stronger tendency than heretofore, and certain Illinois coals have advanced slightly in the immediate past. The movement of domestic coke has been more active than at any time this winter, with by-product manu facturers drawing upon their stock piles. M etallurgi cal coke continues quiet, with contracting for first half requirements somewhat smaller than ordinary at this season. Railroads operating in the district report a sea sonal recession in the volume of freight handled, but as contrasted with former years, the movement con tinues on a large scale. A ccording to the American Railway Association, loading of revenue freight for the week ended Decem ber 29 was 615,431 cars, a decrease of 261,826 cars under the preceding week and 88,793 cars under the same week in 1922, but a gain of 86,875 cars over the corresponding week in 1921. The sharp decrease as compared with the week of Decem ber 22 was due to the Christmas holidays. On Decem ber 31 the railroads of the country had 312,338 surplus freight cars, an increase o f 74,995 over the week before. The St. Louis Terminal Railway Association, which includes in its membership 26 roads operating through this gateway, interchanged 189,644 loads in December, the smallest number since last June, and comparing with 207,973 loads in November, 226,242 loads in October, and 196,136 loads in Decem ber, 1922. Pas senger traffic of roads reporting to this bank increased 4.7 per cent in Decem ber over the same month in 1922. Reports relative to collections, while still indi cating rather spotted conditions, were somewhat more favorable than for the preceding month. In the typi cal grain areas payments show improvement, and gen erally through the South, except where the cotton crop was short, collection efficiency is high. Initial market ing of tobacco has resulted in the liquidation of loans based on that com m odity, and settlements in the rice grow ing sections have been on a satisfactory scale. Retailers in the large cities report that they are getting in their m oney promptly. Complaints o f backward ness are still received from the coal mining districts. January 1 settlements with wholesale interests in the large cities were slightly better than a year ago. Answers to 386 questionnaires addressed to repre sentative interests in various lines throughout the district show the follow ing resu lts: E xcellent G ood Fair P oor 33.6% 50.0% 10.7% Dec. 1923....... ..............5.7% Nov. 1923..................... 0.9 34.9 55.7 8.5 Dec. 1922..................... 8.2 56.2 34.2 1.4 Commercial failures in the Eighth Federal Reserve District during December, according to D un’s, numbered 96, involving liabilities o f $1,954,500, against 109 defaults with indebtedness o f $2,223,369 in N ovem ber and 84 failures for $897,491 in Decem ber, 1922. Per capita circulation of the United States on January 1 was $44.22, which compares with $44.01 on Decem ber 1 and $42.81 on January 1, 1923. M AN U FA C TU R IN G A N D W H O L E S A L E Automobiles Passenger car and truck production for the coun try as a w hole during Decem ber was less by 3.1 per cent than during November, the decrease being ac counted for in part by the closing of plants for the holidays. A s compared with a year ago the D ecem ber output showed a gain o f 35.4 per cent. Companies reporting direct or through the Autom obile Chamber of Commerce built 275,121 passenger cars in December against 284,758 in November. Production of trucks in December totaled 27,275, which compares with 27,374 in November. Sales of passenger cars during December, according to reports of 230 dealers scattered through the district, were 11.0 per cent larger than for the same month in 1922, and 3.5 per cent in excess of the November total. The comment was general that the holiday stimulus to the trade, both in cars and acces sories, was more pronounced than in any previous year. No improvement was noted in the tire situation, which continues slow and unsettled. Used car sales were described as about normal for the time of the year, but in many instances selling was accomplished under unusual pressure and by dint of sharp price reductions. Boots and Shoes December sales of the 11 reporting interests were 2.0 per cent larger than for the corresponding month in 1922, and 25.1 per cent in excess of the N ovem ber total. Uncertainty relative to styles and prices, coupled with the general disposition to caution, caused backwardness in future buying during December, but orders received since January 1 show distinct im prove ment. Prices of finished goods remained stationary, but a firmer tone was noted in raw materials. Some specific advances were recorded on novelty leather and other specialties, and the trend of hides and sole leath er was upward. The demand for w om en’s and child ren’s shoes in relatively more active than men’s wear. Factory operation was at from 75 to 85 per cent of capacity. Boot and shoe production in this district* during December was 8.2 per cent under the N ovem ber total. Clothing Accounts from reporting interests in this line indicate rather mixed conditions. Orders for imme diate or reasonably prompt delivery are holding up in excellent shape, but purchasing for spring is gen erally backward, and considerably under the corres ponding period last season. There is some hesitation due to uncertainty relative to price and styles. W om en’s wear is the most active department of the trade, sales having been stimulated by numerous new and attractive designs and patterns. Cloakings of large patterns have been in extensive use, and the demand for such designs, both in cheap and expensive cloths, is active. The recent cold weather has assisted in m oving a large volume of heavy wear, both men’s and w om en’s, though in many instances at reduced prices. Prices on spring lines are slightly higher than those current on similar goods last fall. December sales of the 12 reporting interests were 15.1 per cent larger than for the same month in 1922, and 13.9 per cent under the November, 1923, total. The decrease from November to December was accounted for in large part by seasonal considerations. Decem ber sales of reporting wholesale hatters showed a 12.1 per cent decrease under those of the same month a year ago, but no discouraging signs are in evidence inasmuch as a fair spring business has been booked. Drugs and Chemicals Sales of the 11 reporting interests in Decem ber were about even with the corresponding month in 1922, and 7.3 per cent under November, 1923. The demand for drugs and fine chemicals continues fair, and buying by wholesalers and jobbers for spring delivery is in satisfactory volume. A further slowing down in purchases o f heavy chemicals by manufac turers was noted in December, but more activity in this department has developed since the first of Janu ary. Prices of drugs showed a number of changes, with advances outnumbering declines. A m ong the items to advance were arsenic and arsenic products, castor oil and the essential oils. The botanical drug market was easier. Inquiries for spraying materials for delivery in the spring were reported good. D ry Goods A conspicuous feature of the textile situation is a trend toward medium priced novelty fabrics which is limiting demand for standard merchandise. Cheaper goods throughout the line are m oving well, but the public and retail merchants are adverse to purchasing the more expensive merchandise. Demand for cotton goods continues light and curtailment of production was more noticeable. Prices hold steady. Brown sheetings, gray cloths and fine convertibles are being bought sparingly. Demand for silk is relatively better than for cotton, with some substitutions noted because of advances in cotton quotations. H osiery continues slow and unsettled. Decem ber sales of 11 represen tative interests were 11.3 per cent under the D ecem ber, 1922 total and 27.0 per cent under the November, 1923 mark. Orders placed during the first three weeks of January were about equal to those of the same period a year ago, but future business on the books of reporting firms is considerably less than at this time in 1923. The millinery business exhibits no changes of importance, with Decem ber sales of report ing firms showing a 2.1 per cent increase over D ecem ber, 1922. Electrical Supplies Business in this classification underwent a rather decided slump in December, sales of the 12 reporting interests for that month showing a decrease of 8.5 per cent under the same period in 1922, and a decline of 3.1 per cent as compared with November, 1923. W eakness in the copper market is given as one cause for hesitancy on the part of consumers in filling their needs, and generally buying is on a hand-to-mouth basis. The cold weather had a tendency to curtail out side work on construction jobs and repair work by the public utilities companies. T he movem ent of holi day goods, especially radio sets, household appliances and fancy lighting fixtures, was in good volume. Prices generally were stationary during the period under review. Fire-Clay Products A steady demand from all industries except oil characterized this line during the past thirty days. The high rate of cement production is reflected in large orders for kiln-liners and nine-inch straights by cement manufacturers. The automobile industry con tinues to take large tonnages, and there is a moderate demand from producers of iron and steel. Decem ber sales of 5 representative interests exceeded those of the same month in 1922 by 11.7 per cent, but were 13.7 per cent under the Novem ber, 1923 total. Busi ness booked b y reporting firms during the first three weeks of January was at a rate 8 per cent in excess of the Decem ber total, but during the same weeks in January, 1923, sales were at a rate 19 per cent greater than during Decem ber, 1922. Production of reporting firms averages 73 per cent o f capacity. Flour Production at the 11 leading mills of the district during Decem ber was 323,697 barrels, which compares with 404,824 barrels in November, 446,009 barrels in October and 346,030 barrels in December, 1922. Busi ness during the closing weeks of December was rather quiet, though there were fair shipping directions from the South for soft flours, and some clears were sold for export. Follow ing the usual holiday quietness, the trade developed considerable improvement in early January, and during the second week of the month prices advanced slightly. Sales from the mills, par ticularly of soft flours to Southern customers, were freer than in a long while, and with shipping direc tions good, the feeling generally was more hopeful. There was a fair volume of demand for clear flours for export, but prices offered were below the views of sellers. Mill operation was at from 60 to 75 per cent of capacity. Furniture The disposition on the part of retailers to buy only sufficient goods for immediate requirements, and expectations of lower prices were the chief factors in causing declines in Decem ber sales of manufacturers and wholesalers in this district. The 26 reporting interests show Decem ber sales 18.0 per cent under those of the same month in 1922 and 12.5 per cent under the November, 1923 total. Prices showed no change w orthy of note, but some revisions are expected as a result of the furniture market held in Chicago during the first three weeks of January. Manufac turers exhibiting their goods at that market report that they booked a good volume of orders, and gener ally expectations, are for improved business during the next few months. Upholstered goods, metal furni ture, dining room sets and floor coverings are in rela tively better demand than other goods in the line. Groceries Unseasonably warm weather during the six weeks preceding Christmas and a determination on the part of retailers to carry light stocks, contributed toward a curtailment in the demand for holiday goods. December sales of 19 representative interests were 2.7 per cent under those of the same month a year ago and 15.6 per cent under the November, 1923, total, the latter partly seasonal. In spite of keen competition, there has been a more optimistic tone since January 1, and this feeling has been accentuated by firmer prices in several staple lines. Canned goods are in better demand and a record movement of condiments con tinues. Slightly higher sugar prices during January lent a further firmness to the general list and has given some impetus to buying by retailers. In spite of an influx of cheap coffees, prices on choice grades con tinue firm to 2c higher while a Yzc advance in cheaper grades went into effect. Hardware Except for certain specialties, builders' hardware and wire goods, the demand in this line developed recessionary tendencies. Sales of the 12 reporting interests in D ecem ber were 8.8 per cent under the same month in 1922, and 13.0 per cent under N ovem ber, 1923. The com m ent is made that farmers are buying only what they are absolutely obliged to have, and the heaviest losses in sales are in the rural dis tricts. Future business on books of reporting interests was considerably less than a year ago, but the first tw o weeks in January developed some improvement in this respect. Iron and Steel Products A ctivity in iron and steel products, particularly finished steel, since the first of the year, has been well up to expectations. New business placed has been in fair volume, and tentative inquiries indicate that further buying is likely in the not distant future. Stocks in consumers’ hands are moderate, having been cut down by routine consumption during the closing weeks of 1923 and further curtailed for inventory taking. A number o f mills, foundries and machine shops, which had planned to close down or sharply reduce operations for inventory and repairs, have been working at or close to the rate maintained during the preceding thirty days. Several o f the steel interests and specialty makers have slightly expanded their operations in order to handle increased specifications and orders for finished products. Prices generally remain unchanged, both o f raw and finished materials. P ig iron buying during Decem ber was quiet, and con fined chiefly to small lots for prompt shipment, but some tonnages were contracted for since the second week in January, and resumption of purchasing for balance of the first and through the second quarter is expected in the near future. T he upturn in scrap iron and steel prices was pushed still further, a number o f important items having touched new high points on the movement. No. 2 Southern iron, 1.75 to 2.25 per cent silicon, was quoted at $21.50 to $23.00 fur nace, while Northern iron o f the same grade sold at $23 to $24. Railroads continue the chief factor in steel and iron buying, with the autom otive industry second in order. Fabricators of structural iron and steel report a continued steady demand for materials for small projects, and some improvement is noted in buying by the oil industry. Orders for bars and sheets have been large, and manufacturers of tin plate are well situated in the matter of forward business. Manu facturers of radiators and heating apparatus have been working at capacity. Decem ber sales of stove manu facturers, 7 interests reporting, were 36.6 per cent under the same month in 1922 and 31.5 per cent under the November, 1923 total; railway supplies, 5 report ing, decreased 28.0 per cent under December, 1922, and 26.5 per cent under N ovem ber, 1923; farm imple ment makers, 6 reporting, decreased 14-5 per cent under December, 1922, and 12.0 per cent under N ovem ber, 1923; manufacturers o f boilers, stacks, elevators, radiators and other miscellaneous products, 12 report ing, decreased 14.0 per cent under December, 1922, and 5.8 per cent under November, 1923. * Lumber A considerable amount of buying in the soft w oods, especially yellow pine, developed in December, with the effect of stimulating prices rather markedly on yard items. Com m on boards were bought very largely, and, as a result, prices on this stock sustained an advance o f from $2 to $3 per thousand feet. Dimension was also affected by the upward trend. Shed stock, except in certain items, has also shared in the upward movement, but to a less notable extent. Fir prices have m oved up an average o f about $1 per thousand. The hardwood situation has been affected by unfavorable weather in the South. Production has been curtailed and with some betterment in demand and a scarcity o f dry items, the market dis plays strength. Mills in the Memphis territory have advanced prices on an average of $5 per thousand since January 1. Consumption of Electricity The Christmas holidays and year-end shut downs account for a part of the decrease in electricity consumed for industrial purposes during December as compared with November, 1923. It is significant, however, that in addition to seasonal curtailment some slow ing down is noted in representative lines, includ ing shoe factories, the automotive industry and mis cellaneous light manufacturing. Comparison with December, 1922, however, shows a substantial increase for the five reporting centers, though the bulk of it is in St. Louis. Detailed figures fo llo w : N o. o f D ec. N ov. custom - 1923 1923 ers * K .W .H ., * K .W .H . 915 988 Evansville ............ 40 L ittle R o ck .......... 11 748 778 Louisville ............ 67 3,852 3,936 Mem phis ...............31 1,143 1,477 St. L ou is.................69 15,102 15,000 T otals.......... 318 21,760 D ec. 1923 com p, to N ov. 1923 — 7.4 % — 3.9 — 2.1 — 22.6 + 0.7 22,179 — 1.9 D e c. D ec. 1923 1922 com p, to * K .W .H . D ec. 1922 898 + 1.9% 681 + 9.8 3,832 + 0.5 1,149 — 0.5 11,922 + 2 6 .7 18,4§2 + 1 7 .7 The follow ing figures, compiled by the Depart ment of Interior, give kilowatt production for both lighting and industrial purposes for the entire cou n try : 1923 B y water pow er Septem ber ..........................1,465,439,000 O ctob er ............ ................. 1,475,837,000 N ovem ber ............................1,515,775,000 tL argest on record. B y fuels 3,069,488,000 3,468,266,000 3,326,706,000 T otals 4,534,927,000 t 4 ,944,103,000 4,842,481,000 R E T A IL Severe weather during the last week of D ecem ber quickened the movement of typically winter mer chandise. Decem ber sales, that in many reporting establishments were running under last year’s rate during the first half of the month, exceeded D ecem ber, 1922 figures in 15 out of 22 reporting department stores. Sales for December, 1923 are below the high rate of increase over 1922 noted in the early fall, and the amount of stock on hand indicates that retailers anticipated a somewhat larger demand than occurred. The January movement of overcoats is described as better, with many sales being accounted for because of price concessions, especially since the middle of the month. Sales of furs and of w om en’s coats have been stimulated by the more seasonable weather as well as by special price offerings. Demand for gloves is described as brisk. Rubber goods have also moved well in spite o f an advance of about 10 per cent on items in which cotton enters into the manufacturing process. Shoes are in only fair demand, due partly to the relatively open winter thus far. A preference for silks is noted because of advances in cotton, and good buying of silk yard goods is reported. Sales of reporting chain stores continue at record volum e for this season. Decem ber department store figures fo llo w : Annual rate o f N et sales com parisons Stocks on hand stock turnover D ec. 1923 Six m onths ending D ec. 31, 1923 F o r six m onths to D ec. 31, 1923, to com p, to ending D ec. 1922 same period, 1922 D ec. 31, 1922 D ec. 31, 1923 Evansville ........+ 3.6 % + 9 .7 % + 5.9% 2.16 L ittle R o ck ......+ 7.0 + 1 5 .0 + 1 7 .6 2.71 Louisville ........+ 4.9 + 5.7 — 2.9 4.01 M em phis .......... — 0.7 + 3.8 + 1 5 .3 2.51 Q uincy ........... .......1.1 + 8.1 + 1 1 .9 2.54 St. L ouis ........+ 5.7 + 7.2 + 1 3 .4 3.33 Springfield ......— 6.0 + 7.4 + 1 4 .1 1.55 8th D istrict ......+ 4.3 + 7.3 + 1 2 .3 3.04 Entire U . S .....+ 6.0 + 8.4 + 1 1 .8 3.33 AMUSEMENT RECEIPTS The volum e of amusement receipts is sometimes considered a margin of the purchasing power of the public in excess o f the amount represented by savings and by purchasing o f necessities. T he curve shown in the chart below is based on admission tax collec tions reported by the several Collectors of Internal Revenue in states w holly or partly within the Eighth Federal Reserve District. The collections include tax paid at theaters and for other amusements. A llow ance has been made for normal^ seasonal variation. T he curve reaches a maximum during the inflation period in 1920, but lags behind the retardation of busi ness during 1921, reaching its later minimum toward the end o f 1922. T he year 1923 exhibits only a slight upward tendency, actual receipts for that calendar year being 1.4 per cent above the average of the five year period. PER CENT PER CENT 150 150 125 125 Computed 100 100 75 75 50 50 25 25 1919 1920 1921 1922 1923 Percentage of deviation of 10% admis sion tax receipts from computed normal. A G R ICU LTU R E Smaller acreages o f wheat than seeded in 1922 are indicated for all states o f the district. In Illinois a reduction of about 600,000 acres in the area sown last fall is reported, and the average condition is slightly below normal. Generally, however, stands of fall sown grains are good, and the arrival of the recent extreme cold weather found m ost fields with snow protection. T h e crop is now in the dormant stage, so that it is impossible to estimate the extent of possible damage from unfavorable weather conditions or other factors. T he movement of wheat to market during Decem ber was considerably under the corresponding month in 1922. The recent cold weather has been beneficial for corn, and in Illinois and other sections o f the district where excessive rains had interferred with husking and cribbing, farmers have been able to complete these operations, and virtually the entire crop has been housed. The condition of corn arriving at market has undergone considerable improvement since the drop in temperature, but there is still a relative scarcity of the higher grades. Receipts at the chief markets have been heavy, especially at St. Louis. The grain has been readily absorbed and large amount were being shipped South for export. Reports from many sections indicate that an unusually large quantity of corn is being fed to live stock, and the movement direct from grow ers to feeders continues heavy and i t prices which compare favorably with those paid at terminal markets. Reports relative to the amount of fall plowing and soil preparation accomplished vary rather widely. In some areas field w ork was delayed by heavy rains, but the warm weather which lasted well through December permitted of later work than ordinary, and the general average is estimated to be £bout on a parity with that of the past several seasons. According to the Department of Agriculture wages of farm labor were higher last year than since 1920. The average rate with board was $33.18 and without board $46.91 a month. T he rates in 1914 were $21.05 and $29.88 respectively. Farm help is every where adequate to the demand, and during the past fall more work was performed by farmers and their families than in a number of years. The warm, wet spell which follow ed opening of the loose leaf tobacco markets made difficult the proper handling of delivered tobacco on account of its being soft or in too high order. T he sudden change to zero weather proved a further disability to handling the leaf and retarded the movement to market. Recent sales of dark tobacco averaged around $12 and for burley around $23. W hile in pounds the 1923 crop exceeds the 1922 production by approximately 15 per cent, the quality is lower. For this reason fine dark tobacco is scarce and will bring close to last year’s prices. The Dark T obacco Growers Marketing A sso ciation has opened its receiving houses in the Green river, stemming and one sucker districts with rela tively light receipts of 1923 stock. Receiving houses in the dark fired district have not been opened, but will be in the near future. T he Burley T obacco Growers Cooperative Association has been actively receiving at its houses, and has requested growers to curtail deliveries in order to avoid congestion. A bout 85 per cent of the burley growers have joined the asso ciation. The comment is made in a number of markets that the export demand for low grades of tobacco is better than in past years, which fact is ascribed to unsatisfactory financial conditions in Europe. Due to extremely wet weather throughout D ecem ber, threshing of rice in Arkansas was seriously de layed, and a considerable portion of the crop, esti-. mated at from 10 to 15 per cent, still remains in the fields. Deterioration of rice in the shock is reported from some counties, but elsewhere fields were kept well drained and relatively little damage occurred. The demand for clean rice continues active and strong, with good grades selling at from $1.10 to $1.20 per bushel. The rough rice market is less active than heretofore because most of the mills filled up with stock prior to the holidays. T h e feeling among rice farmers is more optimistic than for more than three years, and indications point to a slight increase in acreage this spring. In the cotton areas the belief prevails that the recent cold weather killed many boll weevils. Although it is conceded that the new crop will be an expensive one to produce, the general attitude is hopeful, and every effort will be made to raise a large amount of cotton. Live Stock Movement Receipts and shipments of live stock at St. Louis, as reported by the National Stock Yards, were as * Shipments fo llo w s: *R eceipts D ec. 1923 Cattle and Calves...................... 99 H o g s............................................... 432 H orses and M ules..................... 8 Sheep........................ ...................... 34 * In thousands (000 om itted). N ov. 1923 125 451 8 34 D ec. 1922 114 398 8 33 D ec. 1923 54 257 8 16 N ov. 1923 79 281 11 16 D ec. 1922 76 246 10 8 Commodity Movement F IN A N C IA L Receipts and shipments of important com m odi ties at St. Louis, as reported by the Merchants’ Exchange, were as fo llo w s: D ec. 1923 Beef, lbs........................... 30 Corn, b u ........................... 4,522 Flour, bbls....................... 420 H ides, lbs......................... 8,034 Lard, lbs........................... 6,503 Lead, p igs....................... 215 Lum ber, cars.................. 18 Oats, bu............................ 2,906 Pork, lbs......................... 17,442 W heat, b u ....................... 2,271 368 Zinc, slabs....................... * In thousands (000 om itted ). ^ R eceip ts_______ N ov. Dec. 1923 1922 589 200 2,134 2,332 476 363 8,221 5,758 6,795 4,557 155 276 19 16 2,646 2,640 22,907 15,555 2,259 3,173 171 217 Dec. 1923 27,890 1,967 532 9,782 12,600 186 12 2,383 27,331 1,722 225 ^Shipments N ov. D ec. 1923 1922 25,324 20,635 842 1,214 558 469 10,304 9,498 11,564 9,530 215 128 14 10 1,908 1,657 31,342 27,820 1,819 2,351 154 208 Commodity Prices Range of prices on typical products in the St. Louis market between Decem ber 15, 1923, and Janu ary 15, 1924, with closing quotations on the latter date, and on January 15, 1923: Close W heat H igh L ow Close Jan. 15 Jan. 15, 1923 M ay ............ ..per bu. $ l . l l f $ $1.10*6 $ 1 .1 7 # $1.0654 July ............. ... “ 1.06** 1 .0 3 # 1.11 1.0654 Septem ber ............ 1.05 1.06J4 1 .0 5 # 1.0754 N o. 2 red winter 1.09 $1.36 1.40 1.20 $1.17 b 1.19 N o. 2 hard............ 1.11 1.07 1.11 1 .0 3 # Corn M ay ....................... .8 0 # .725-4 .80 .7354 July ...................... .74 .80 54 .725/8 .80*4 Septem ber ............ .79 .80?* .80M N o. 2 ................. .78 .71 .78 ''.72# N o. 2 white ........ .80 .71 .74 .80 Oats M ay ..................... .46 •94 45 .4654 .4954 N o. 2 w hite........ .48 54 .44 .4554 .4854 F lour Soft patent............ per bbl. 6.50 5.25 5.50 6.50 6.00 @ 7.00 Spring patent...... “ 6.40 5.60 6.00 @ 6.25 6.40 @ 6.60 .35 54 M iddling cotton ........per lb. .34 .34 .2754 H o g s on h oof..........per cw t. 7.80 5.00 5.25 @ 5.35 6.75 @ 8.60 N O T E : D ecem ber wheat closed at $ 1 .0 4 ^ Decem ber corn at 71c and D ecem ber oats at 4454 c. B U IL D IN G W inter building activity on an almost unprece dented scale continued through the first week in Janu ary, at which time the extreme cold weather caused a slowing down on outside work. In the large cities, particularly St. Louis, building labor is fully employed, and in several crafts a small shortage of workers is reported. The demand for all kinds of building materials continues brisk, and manufacturers are add ing to their stocks in anticipation of heavy call when the spring building season opens. Permits issued in the five largest cities of the district in December showed a decrease of 28.4 per cent under the same month in 1922, but in the earlier year the total was abnormally heavy, due to the inclusion of several large building enterprises in Memphis and St. Louis. Exten sive road building programs for 1924 are planned in states of the district, and w ork on them will be begun as soon as weather conditions permit. Production of cement for the country as a whole in December totaled 9,997,000 barrels, which compares with 8,671,000 barrels in Decem ber, 1922. The total out put, 35,950,000 barrels, in 1923 was the largest on record. Building figures for December fo llo w : N ew Construction Evansville ..... Little R ock... Louisville ..... M em phis .... 1923 46 56 161 209 543 1922 45 63 176 208 426 $ 1923 123 109 687 2,520 3,196 1,015 918 $6,635 6,965 1,592 1,266 1,513 3,988 1,906 O ct. * I n thousands of dollars (000 om itted ). Repairs, etc. 1922 $1,102 220 2,010 4,290 1,645 $9,267 5,380 5,893 1923 48 63 51 20 358 540 834 1,133 1922 21 76 44 34 560 735 782 979 1923 $ 14 66 30 12 268 $390 547 601 1922 $ 6 24 87 33 697 $847 433 461 The past thirty days have been featured by no marked changes in the financial and banking situation. The general demand for credits has receded somewhat, and there has been fair liquidation, particularly in the South w^here returns from marketing of cotton, rice and tobacco are being used to pay debts. Increased sales of corn by producers have been a factor in settle ments in the grain areas, but borrow ings by elevator and commission interests to finance the movement of this cereal have served to augment loans by banks in some sections. January 1 settlements with manu facturing and wholesale interests were in the main satisfactory. Banks in the larger centers of population report that their mercantile customers are slightly increasing their commitments, but the demand is nowhere urgent and funds are ample for all legitimate requirements. The trend of interest rates charged for the general run of commercial loans is easier. In some parts of the South where crops were short liquidation has been relatively light, and extensions of loans are being requested. The demand for financing live stock holds up well. Deposits of member banks scored a fair gain, and there was a small increase in loans and discounts. Their discounts with this institution, however, showed a further sharp decline, the de crease between December 15 and January 15 being $13,179,122. Between the same dates there was a decrease of $5,066,000 in Federal Reserve notes in circulation, this being accounted for largely by the usual falling off in the demand for currency follow ing the holidays. The reserve carried against com bined Federal reserve note and deposit liabilities increased 7.2 per cent, standing at 75.2 per cent on January 15. Commercial Paper The demand from both city and country banks for commercial paper suffered a rather sharp decline in late December, and during the first half of January continued light. H owever, sales in early December w^ere in good volume, and reporting brokers showed an increase for that month of approximately 16.5 per cent over the same period in 1922, and as compared with November, 1923, the Decem ber total was larger by 7.0 per cent. Supplies of paper are plentiful enough, but the easier rates, coupled with the fact that banks are finding full employment for their funds through their regular customers, tend to hold down the volum e of investment in commercial paper. Rates ranged in this district from 4% to 5 per cent, but in some Eastern centers as low as 4 y2 per cent was done on prime names. Savings Deposits Num ber < Jan. 2, banks reportin] 1924 $ 9,062 Evansville ......4 7,278 Little R ock ....5 26,012 Louisville ........7 18.619 M em phis ........5 73,852 St. L ou is......12 -------Totals....33 $134,823 In thousands (000 om itted ). D ec. 5, 1923 8,974 7,146 24,434 17,882 73,426 Jan.: 3, 1923 $ 8,956 6,679 23,055 15,959 69,548 $131,862 $124,197 Jan. 1924 com p, to D ec. 1923 + 1.0 % + 1.8 % 4* 6.5% + 4.1% Jan. 1924 com p, to Jan. 1923 -f 1.2% + 9.0% + 12.8 % + 16.7% + 0.6% + 6.2% + 2.2% + 8.6% Condition of Banks Debits to Individual Accounts *F or four weeks ending Jan. 1924 Jan. 1924 Jan. 16, D ec. 12, Jan. 17, com p, to comp, to 1924 1923 1923 D ec. 1923 Jan. 1923 E. St. L ouis and Natn. Stock Yards, 111..$ 38,848 El D orado, A rk ................. 5,870 Evansville, In d ................. 30,689 F ort Smith, A rk .............. 12,315 Greenville, M iss.............. 4,573 H elena, A rk ............ .......... 6,446 L ittle R ock, A rk ............ 61,061 Louisville, K y ................... 150,135 Mem phis, T en n................ 162,738 O w ensboro, K y ................. 7,266 Q uincy, 111......................... 9,449 St. L ouis, M o.................. 654,932 Sedalia, M o ....................... 4,894 Springfield, M o ................. 12,894 $ 44,174 6,229 30,011 14,527 4,628 8,272 73,669 142,719 180,408 5,809 9,725 621,824 3,837 13,560 $ 39,872 — 12.1% ...— 5.8 33,617 + 2.3 11,282 — 15,2 4,975 — 1.2 6,559 — 22.1 61,269 — 17.1 161,792 + 5.2 156,403 — 9.8 7,875 + 2 5 .1 10,488 — 2.8 691,440 + 5.3 .. + 2 7 .5 14,668 — 4.9 — 2.6% .................. — 8.7 + 9.2 — 8.1 — 1.7 — 0.3 — 7.2 + 4.0 — 7.7 — 9.9 — 5.3 .................. — 12.1 Changes in the condition of banks in this district are reflected in the follow ing statement showing the principal resources and liabilities of reporting member banks in Evansville, Little Rock, Louisville, Memphis and St. Louis: Number of banks reporting................. . Loans and discounts (incl. rediscounts) ,$ 11,253 , 152,795 , 307,041 During Decem ber the Federal Reserve Bank of St. Louis discounted for 279 of its 630 member banks, which compares with 284 of its 627 member banks accommodated in November. The discount rate of this bank remains unchanged at Ay2 per cent for all classes and maturities of paper. Changes in the assets and liabilities of the Fed eral Reserve Bank of St. Louis since a month ago and last year are shown in the follow ing comparative statem ent: Total reserves. Non-reserve cash. Bills discounted: Bills bought in open market.... U. S. Government securities: Bonds ..................................... Treasury notes...................... Certificates of indebtedness.. *Jan. 17. 1923 $ 81,608 3,632 $ 53,713 25,152 4,356 $ 85,240 21,143 2,876 ..$ 96,780 .. 12,573 Gold held exclusively against F. R. *Dec. 19, 1923 $ 49,656 4,057 ..$ 59,723 .. 31,435 ,. 5,622 $ 83,221 7,120 $109,257 13,226 ..$109,353 .. 4,756 $ 90,341 7,048 $122,485 5,081 s 16,846 .. 26,316 21,129 40,301 6,002 ..$ 43,162 348 Gold redemption fund with U. S. Tr< *Jan. 16, 1924 ..$ 56,309 Y 3,414 $ 61,430 29 $ 13,374 14,926 ........... ........... Total U. S. Government securities.....$ 7,372 7,306 541 750 10,666 1,291 $ 24,450 6,478 Total earning assets............................... $ 44,801 Uncollected items........................................... 35,539 Bank premises................................................. 1,402 All other resources......................................... 175 $ 61,459 37,833 1,345 74 $ 52,750 40,320 919 504 RESOURCES........................ $196,026 $198,100 $222,059 F. R. notes in actual circulation.................. $ 72,286 Deposits: Member banks—reserve account.............. 70,617 U. S. Government..................................... 2,270 Other deposits............................................. 601 $ 77,478 $ 88,145 65,920 853 527 76,349 525 1,165 Total deposits.............................................$ 73,488 Deferred availability items............................ 34,676 Capital paid in................................................. 5,006 Surplus ............................................................ 10,072 All other liabilities......................................... 498 $ 67,300 37,106 5,012 9,665 1,539 $ 78,039 40,692 4,830 9,665 TOTAL LIA B ILITIE S................... ...$196,026 MEMO— Contingent liability on bills purchased for foreign correspondents....... 764 Ratio of total reserves to deposit and * F. R. note liabilities combined................ 75.0% Tn thousands (000 omitted). $198,100 $222,059 TOTAL 86,000 15,354 25,939 10,896 25,226 3,518 87,287 $152,704 41,377 8,980 350,185 189,760 1,444 $168,220 47,170 7,653 386,184 181,951 10,665 7,536 28,295 1,436 1,336 5,788 19,039 Postal Receipts Dec. 31, 1923 Little Rock.. .. 476 .. 3,244 ..$4,753 *In thousands (000 omitted). *For quarter ended Sept. 30, June 30, Dec. 31, 1923 1923 1922 $ 120 $ 141 $ 140 190 190 186 569 591 578 435 408 457 2,478 3,062 2,694 $3,774 $4,024 $4,441 Dec. 1923 comp, to Dec. 1922 + 2.8 % + 9.5% + 15.1% + 4.2% + 5.9% + 7.0% C O S T O F L IV IN G Cost of living in the United States on December 15, 1923 had decreased three-tenths of one per cent from the November 15 level, according to the National Industrial Conference Board. Between Novem ber 15 and December 15, 1923 there was an increase in the average cost of clothing and a decrease for food. These changes were each less than one per cent. There were also decreases in coal prices in some of the larger cities, but these were not sufficient to justify any change in the level of fuel prices for the country as a whole. Between July, 1920, when the peak of the rise in the cost of living since 1914 was reached, and December, 1923, the cost o f living decreased 19.3 per cent. The net increase since July, 1914 was 65.0 per cent. The follow ing table shows in detail changes noted above. Percentage of increase in the cost of living Relative above average prices L IA B IL IT IE S 688 $461,266 15,193 21,861 6,956 17,103 5,591 . . Ml *In Thousands (000 omitted), tDecrease due to consolidation. St. R E SO U R C E S $470,329 .$158,819 . 42,229 . 8,028 . 363,623 . 196,972 . 4,649 Bills payable and rediscounts with Federal reserve bank $ 18,471 142,578 300,217 . 14,992 . 24,668 7,061 . 17,403 . 8,070 . 86,625 Cash in vatrit.. Net dematfcl d Time deposits $ 11,853 146,338 312,138 .$471,089 Investments U. S. pre-war b Liberty bonds.... Treasury bonds.. Totals....................... $1,162,110 $1,138,078 .. + 2.1 t — 4.1 * In thousands (000 om itted ). tT h is is the first time a decrease under the corresponding period in the immediately preceding year hasbeen recorded since M arch, 1922. Federal Reserve Operations *Jan. 16, *Dec. 12, *Jan. 17, 1924 1923 1923 1*35 t35 37 Percentage of decrease in the cost of living on Dec. 15, 1923, from average prices in Nov. July 1920 1923 31.5 0.7 13.9* No change 34.2 0.6** 6.0* No change (0.5) (24.3) 5.9 No change in family July Nov. Dec. 1920 1923 1923 budget 50 119 51 Food* ..........................43.1 80 80 58 Shelter ........................17.7 75 74 Clothing ....................13.2 166 76 Fuel and light.......... . 5.6 76 66 (92) (93) (93) (Fuel) .................... (3.7) (Light) .................. (1.9) (15) (43) (43) 74 74 85 Sundries ....................20.4 Weighted average 0.3 19.3 104.5 65.3 65.0 of all items................ 100.0 *Food price changes are from the United States Bureau of Labor Statistics. **Increase. Item The purchasing value of the dollar based on cost of living in December, 1923 was 60.6 cents as con 73.7% 62.4% trasted with one dollar in July, 1914. (Compiled January 21, 1924) 787 1,593 B U SIN E SS C O N D IT IO N S The index of production in basic industries declined 4 per cent in December to the low point of the year. The decrease for the month reflected principally a large reduction in con sumption of cotton, but also reduced operations in the woolen, petroleum, sugar and lumber industries. Production of pig iron and anthracite increased. Latest figure, December, 112. The Federal Reserve Board's index of factory employment decreased 1 per cent and was 4 per cent lower than in the spring. The largest decreases were at plants manufacturing food products and railroad equipment. Building contract awards in December were smaller than in November, but almost 25 per cent larger than a year ago. Trade Railroad shipments continued to decrease during December and were slightly less than in December, 1922. Loadings of coal and grain were smaller than a year ago, while loadings of miscellaneous merchandise and live stock were in larger vol umes. The volume of wholesale trade showed more than the usual seasonal decrease and was at about the same level as a year ago. Sales of meat, hardware and drugs were larger than in December, 1922, while sales of dry goods and shoes were smaller. Retail trade, though larger in December, 1923, than in any other month on record, did not show as large an increase over November as is usual at the Christmas season. Prices Wholesale prices, according to the index of the Bureau of Labor statistics, underwent a decrease of less than 1 per cent during December. N T H E U N IT E D S T A T ^ ^ r two weeks of January, pricis of corn, wheat, pig iron, petro leum and lumber advanced, while quotations on cotton, sugar and copper were lower. Bank Credit The volume of credit extended by the Federal reserve banks showed the usual sharp increase during the latter part of December in response to holiday requirements for credit and currency and financial settlements falling due on the first of January. With the passing of the seasonal demands there was an unusually rapid return flow of currency to the reserve banks, reflected both in an increase of reserves and decrease of Federal reserve note circulation. Latest figure, January 23. Member banks used the currency returned from circulation to reduce their borrowing, with the consequence that the earn ing assets of the Federal reserve banks declined $360,000,000 during the four weeks following Christmas, or approximately $150,000,000 more than during the corresponding period in 1923, At the middle of January the volume of reserve bank credit outstanding was below $1,000,000,000 for the first time s»nc» early 1918. Loans made largely for commercial purposes by member banks in principal cities, declined between December 12 and January 16 to a point $264,000,000 lower than at the peak in October and to about the level of July, 1923. This decrease in loans, which was general throughout the country, was accom panied by a movement of funds to the financial centers and an increase in loans on securities, principally in New York. M E M B E R B A N K CREDIT 1919 Latest figure— December, 151. The chief reductions occurred in prices of fuel and building materials, while prices of clothing and metals increased, and prices of farm products remained unchanged. During the first 1920 1921 1922 1923 1 9 2 «* Weekly figures for member banks in 101 leading cities. Latest figure, January 16. v Easier money conditions during January were reflectedf _ in a further slight decline in the rate of prime commercial papc-r ‘ to 4yA per cent, compared with 4y4 to 5 per cent in December, and in increased activity in the investment markets.