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MONTHLY REVIEW O f Agricultural, Industrial, Trade and Financial Conditions in the Eighth Federal Reserve District R elea sed for P u b lic a tio n O n a n d A fte r th e A ftern o o n o f J a n u a r y 3 1 ,1 9 3 4 JO H N S. W O O D , Chairm an and Federal R eserve A g en t FEDERAL RESERVE O N T IN U IN G the trends noted during the similar period immediately preceding, gen eral business and sentiment in the Eighth District during the past thirty days developed quite decided improvement. Reports relative to trade, both retail and wholesale, were on the whole the most favorable since last summer. In industry sea sonal influences making for curtailment of activities were less in evidence than a year and tw o years earlier, and in certain lines were conspicuously absent. Resumption of activities at numerous manu facturing establishments follow ing the holiday and inventorying period was more rapid than is ordinar ily the case. The considerable inventories acquired by merchants during the summer and early fall of 1933 were heavily reduced by the holiday trade and generally freer buying of a routine sort by the pub lic. Since January 1 there has been a well defined disposition to replenish, as reflected in orders placed with producers and the wholesale and jobbing inter ests. In all lines investigated by this bank except clothing, the volume of Decem ber business was in excess of that during the same period in 1932, and in a number of instances, greater than in December, 1931. The movement of seasonal merchandise, which had been retarded by unusually mild weather in the fall and early winter, was greatly stimulated by the drop in temperatures during the last half of D ecem ber. The holiday trade generally through the dis trict, but more particularly in the south, was in considerably larger volum e than a year ago. Sales of automobiles in Decem ber showed the usual de cline from November, but were measurably larger than during the closing month of 1932. Consump tion of electricity by industrial plants in the princi pal cities of the district in Decem ber was greater than for the same month during the preceding year. Activities in the iron and steel industry declined in less than the usual amount in December, and shipments of pig iron to district melters reached the highest total for that month since 1929. P ro duction o f bituminous coal in fields o f the district declined slightly from Novem ber to December, and C C. M . S T E W A R T , Secretary and Ass*t F ed eral R eserve A g en t BANK OF ST. J. V IO N PAP IN , Statistician LO U IS the output for the latter month was moderately smaller than a year earlier. W eather conditions throughout the district were unusually favorable for agriculture during the fall and early winter. Late crops were harvested and housed with a minimum loss of quantity and quali ty. In all sections, but more particularly in cotton areas, plowing and preparations for spring crops are considerably in advance of the usual seasonal schedule. Markets for the 1933 tobacco crops opened in late December and early this month, with gener ally liberal offerings. Due to dissatisfaction of pro ducers with prices, however, sales were temporarily suspended, and the crop is slow in m oving into con sumptive channels. The trend of cotton prices con tinued upward, and at the middle of January scored a new high on the present crop. Prices of wheat, corn and oats also advanced sharply in the third week of January, practically recovering the losses sustained during December. Cattle and hogs re mained at or about the low levels which have ob tained in recent months. The volume of retail trade in December, as in dicated by sales of department stores in the chief cities of the district, was 15.9 per cent greater than for the same month in 1932, and 52.8 per cent larger than the November, 1933, total; cumulative total for the twelve months of 1933 was 4.1 per cent smaller than in 1932. Combined December sales of all wholesaling and jobbing firms reporting to this bank were 31 per cent smaller than in November, but 29 per cent greater than in December, 1932; cumulative sales of these firms in 1933 were larger by 18 per cent than in 1932. T he dollar value of permits issued for new construction in the five largest cities of the district in December was 45.8 per cent smaller than in Novem ber and 148.3 per cent more than in December, 1932; for the year, value of permits was larger by 88.9 per cent than in 1932. Construction contracts let in the Eighth D is trict in Decem ber exceeded those of the preceding month by 309 per cent and the total was 106.5 per cent larger than in December, 1932; for the year, the total increased 5.4 per cent over that of the pre ceding twelve months. Debits to checking accounts in Decem ber were 8.6 per cent and 10.7 per cent greater, respectively than a month and a year earli er; total debits for 1933 were 11.2 per cent smaller than the 1932 aggregate. Freight traffic o f railroads operating in this district, according to officials o f the companies, de clined in considerably less than the usual seasonal volume in late December. In some classifications the expected recession was entirely absent. A s a result o f the better than seasonal showing, total loadings for the year 1933 exceeded those of the preceding twelve-m onth period by a slight margin, though the total was still considerably below those recorded in 1931, 1930 and 1929. Mild weather pre vailing through the early winter tended to restrict the m ovement o f seasonal commodities, notably fuels. F or the country as a whole, loadings of reven ue freight in 1933 totaled 19,446,718 cars, against 18,518,905 cars in 1932 and 24,583,757 cars in 1931. The St. Louis Terminal Railway Association, which handles interchanges for 28 connecting lines, inter changed 61,258 loads in December, which compares with 64,684 loads in Novem ber and 59,513 loads in December, 1932. D uring the first nine days of Janu ary the interchange amounted to 17,881 loads, against 17,179 loads during the corresponding period in Decem ber and 15,208 loads during the first nine days o f January, 1933. In 1933 there were 828,320 loads interchanged against 816,732 loads in 1932. Passenger traffic o f the reporting lines decreased 7 per cent in Decem ber as compared with the same month in 1932. Estimated tonnage o f the Federal Barge Line between St. Louis and N ew Orleans in Decem ber was 105,700 tons, against 97,457 tons in November, and 93,766 tons in December, 1932. Tonnage handled during 1933 totaled 1,205,916 tons, which compares with 1,292,983 tons in 1932 and 1,170,319 tons in 1931. T he steady improvement in collections, noted during the past several months, continued in D e cember and the first half o f January. Particularly favorable results were reported in the south, where higher cotton and rice prices have enabled produc ers o f these com m odities to considerably reduce their indebtedness to both merchants and banks. Delays in the marketing o f tobacco, occasioned by unsatisfactory prices, unusually heavy rejections and temporary suspension o f sales, have tended to restrict liquidation in sections where tobacco is the principal cash crop. January settlements with w hole salers in the main distributing centers were reported generally satisfactory, and measurably larger than a year ago. Answ ers to questionnaires addressed to representative interests in the several lines scattered through the district show the follow ing results : Excellent December, 1933......... 8.2% November, 1933......... 8.6 December, 1932......... 2.0 Good Fair Poor 32.8% 33.6 14.6 55.7% 53.9 54.6 3.3% 3.9 28.8 Commercial failures in the Eighth Federal R e serve District in December, according to Dun and Bradstreet, numbered 32, involving liabilities of $523,615, against 47 defaults in November with lia bilities of $578,883, and 114 insolvencies for a total of $1,833,530 in December, 1932. In 1933 there were 795 failures with liabilities of $15,443,137 which compares with 1,507 failures in 1932 for a total of $45,568,526 and 1,676 defaults with liabilities of $41,037,704 in 1931. M oney in circulation in the United States on Decem ber 31, 1933, was $5,804,469,600, which com pares with $5,742,492,685 on N ovember 30, 1933, and $5,274,941,484 on Decem ber 31, 1932. M A N U F A C T U R IN G A N D W H O L E S A L IN G Boots and Shoes — There was the usual sea sonal contraction in volum e of business from N ovem ber to December, but the decrease was small er than the average during the past decade. Total sales of the reporting firms in December were about one-half smaller than in November, but 28 per cent greater than for December, 1932. Stocks on January 1 were greater by 54 per cent than a month earlier, but 4 per cent smaller than on January 1, 1933. In the yearly sales comparison increases were general through the entire line, but most pronounced in better grades of footw ear and specialties, including sport shoes. A s compared with the preceding thirty days, there were no price changes worthy o f note, but the general level averages about 15 per cent higher than a year ago, according to estimates of several leading firms. Eighth District production in Decem ber was about 5 per cent below the N ovem ber total, but approximately 10 per cent greater than in December, 1932. Clothing— A ccording to the reporting clothiers, business during the past thirty days shows consid erable spottiness and irregularity. Increases in v ol ume over a year ago are shown by some firms, while others report smaller sales. The average of all firms in Decem ber was below that of a year earlier, also less than the November, 1933 total. T he decrease in the month-to-month comparison is seasonal in character. Demand for work clothes was fairly well maintained and well over the same time a year and tw o years earlier. The movement of heavy apparel through retail channels was retarded during the early winter by unusually mild weather, and reordering of merchandise in this category has been in smaller volum e than is ordinarily the case. Stocks on January 1 were 11 per cent and 60 per cent larger, respectively, than a month and a year earlier. Drugs and Chemicals — Im provement in the movement o f seasonal merchandise was in large measure responsible for an increase of 25 per cent in Decem ber sales of the reporting firms over the preceding month, and o f 33 per cent over the D e cember, 1932, total. Decem ber was the sixth con secutive month in which sales exceeded those of the corresponding period a year earlier. Stocks on Janu ary 1 were 5 per cent smaller than a month earlier, and about 5 per cent greater than a year ago. Pur chasing of holiday goods was reported in heavier volum e than last year. D ry Goods — Decem ber sales of the reporting firms were 40 per cent smaller than in N ovem ber but nearly one-fourth greater than the December, 1932 total. The decline from Novem ber to D ecem ber is seasonal, Decem ber being normally the month of smallest sales of the year. Inventories increased 11 per cent between Decem ber 1 and January 1, and on the latest date were 67 per cent greater than a year ago. Retail stocks generally were much re duced by the holiday trade, and since January 1 the volum e o f ordering has been in large volume, and covers a broader variety o f merchandise than last year. T he number of visiting merchants in the chief distributing centers during early January according to reporting dry goods houses was the largest since 1931. Electrical Supplies — Decem ber sales o f the re porting firms were the largest for any single month since 1931, being about 58 per cent larger than the same period in 1932 and 52.5 per cent greater than the Novem ber, 1933 total. Inventories decreased 12 per cent between Decem ber 1 and January 1, and on the latest date were 6 per cent larger than a year earlier. The increase in the month-to-m onth sales comparison is seasonal in character, but its extent was considerably greater than the average in recent years. Flour — Production at the twelve leading mills of the district in Decem ber was 250,432 barrels, against 270,303 barrels in N ovem ber, and 261,298 barrels in Decem ber, 1932. M oderate improvement in the general demand was noted during the first half o f January, but for the m ost part, buyers are still operating on a conservative basis. E xport in quiries were in slightly larger volum e, but bids from abroad are still below view s o f producers in this area. Mill operations were at from 50 to 55 per cent o f capacity. Furniture — Sales of the reporting firms in D e cember showed less than the usual seasonal decrease from November, and an increase of 58 per cent over the corresponding month in 1932. Incidentally the Decem ber total was the largest for the period since 1929. D uring each successive month since last March, the reporting group of firms has recorded an increase over the same period a year earlier. In ventories on January 1 were 8 per cent and 64 per cent larger than a month and a year earlier, the heavy gain in the yearly comparison being due in large part to higher prices, the advance being vari ously estimated from 20 to 30 per cent. Orders booked at the annual furniture markets at Chicago and Grand Rapids in January were generally re ported to be in substantially larger volume than a year ago. Groceries — Further improvement in this class ification was noted, both as compared with the pre ceding month and a year ago. Decem ber sales of the reporting firms were 18 per cent larger than for the same month in 1932, and 5 per cent above the November, 1933 total. Stocks on January 1 were 1 per cent and 20 per cent larger, respectively, than a month and a year earlier. Belated ordering of holiday goods and a considerable volume of reorder ing of such merchandise helped to bolster the D e cember sales’ total. Hardware — Sales of the reporting interests in Decem ber were the largest for the period since 1929, and for the eighth successive month were larger than for the corresponding period a year earlier. Reports covering the first half of January indicate a continuance of the upward trend in sales. Business was stimulated by public w orks projects, demand of shovels, wheelbarrows, crowbars, axes and simi lar commodities being greater in many instances than could be accommodated. Sales of holiday goods were in larger volum e than during the tw o preced ing years. Decem ber sales o f the reporting firms were approximately one-half larger than for the same month in 1933, and only a shade below the November, 1933, total. Inventories on January 1 were 3 per cent smaller than a month earlier and 19 per cent greater than a year ago, the increase in the yearly comparison being due partly to higher prices. Iron and Steel Products — The usual slow ing down in activities in the iron and steel industry, which marks the final month of the year and the holiday and inventorying period, was considerably less pronounced than a year and tw o years earlier. Certain phases of the industry failed to reflect the seasonal trend, notably the movement of raw and finished materials to consum ing plants. This was due in large measure to the desire on the part of interests having contracts to get in the materials prior to January 1, on which date under code pro visions, contracts for last quarter of 1933 expired. Decem ber movement of pig iron to melters in this area was the largest for the month since 1929, and topped the N ovem ber total by a substantial margin. Shipments o f metallurgical coke and scrap were also in large volume. Stove plants were active later into the season than is ordinarily the case, and several with special mail order house contracts, worked con tinuously except on Christmas and New Year. Job bing foundries reported rather spotted conditions, some having sufficient miscellaneous work to keep them active on part-time schedules, while others closed down in the final week o f Decem ber to re main idle until the middle o f January. Iron and steel warehouses sustained a decrease in business during Decem ber under the preceding month, but a measurable gain over the corresponding period in 1932. Moderate profits were realized in 1933 by certain jobbin g interests reporting to this bank, thus reversing conditions of the preceding year. Prices of raw materials were strong. Recent heavy ship ments of pig iron have served to reduce furnace stocks, and a general scarcity of scrap was reflected in a sharp advance in all grades. H eavy melting steel advanced to the highest levels since last sum mer. Contrary to the seasonal trend, production of pig iron for the country as a whole increased in Decem ber as compared with November. Total Decem ber output of 1,192,136 tons, according to the magazine “ Steer’, compares with 1,083,740 tons in Novem ber and 547,179 tons in December, 1932. Pro duction for the year 1933 amounted to 13,221,707 tons, against 8,674,067 tons in 1932 and 18,263,011 tons in 1931. Steel ingot production in the United States in Decem ber totaled 1,819,648 tons, against 1,540,882 tons in Novem ber and 861,034 tons in D e cember, 1932. In 1933 production amounted to 22,878,571 tons against 13,322,833 tons in 1932. AU T O M O B IL E S Combined passenger car, truck and taxicab pro duction in the United States in Decem ber was 84,045, against 63,904 in Novem ber, and 107,403 in December, 1932. Decem ber is ordinarily the month of smallest distribution of automobiles in the Eighth District, and, according to dealers reporting to this bank, the period in 1933 was no exception. T he extent of the decrease from N ovem ber to Decem ber was con siderably larger than the average during the past decade, due partly to heavier than ordinary sales in N ovem ber and to the fact that prospective pur chasers of passenger cars were inclined to await the appearance of new m odels early this year before filling their requirements. For the seventh succes sive month, however, Decem ber sales were in excess of the corresponding period a year earlier. Total sales of the reporting dealers in 1933 were 19 per cent greater than for 1932, though 40 per cent below the average sales during the past eight years. In the Decem ber sales comparison with a year ago, in creases were more marked in the case of dealers handling cheap and medium-priced cars. Decem ber sales of new passenger cars by the reporting dealers were 12 per cent greater than for the same month in 1932, but 38 per cent below the November, 1933 total. Inventories are universally light, and dealers are in good condition for hand ling the new models when placed on the market. Stocks o f new passenger cars on dealers’ floors on January 1 were 12 per cent smaller than a month earlier and about one-third smaller than on January 1, 1933. T he same general trends were noted in the used car market as that for new vehicles. December sales of secondhand cars were 8 per cent smaller than in November, and 26 per cent larger than in December, 1932. Stocks of salable used cars on hand varied only slightly between December 1 and January 1, and on the latest date were 10 per cent greater than a year earlier. A ccordin g to dealers reporting on that item, the ratio of deferred pay ment sales to total sales in Decem ber was 48 per cent, against 44 per cent in N ovem ber and 55 per cent in December, 1932. R E T A IL T R A D E The condition of retail trade is reflected in the follow ing comparative statements showing activi ties in the leading cities of the d istrict: Department Stores Net sales comparison Stocks on hand Dec. 1933 12 months ended Dec. 31, 1933 comp, to Dec. 31, 1933 to comp, to Dec. 1932 same period 1932 Dec. 31, 1932 Evansville ....+ 1 3 .4 % — 2 .6 % — 1.9% Little Rock..+ 3 3 .9 — 4.7 + 1 4 .7 Louisville .. ..+ 1.9 — 8.3 — 0.6 Memphis .....+ 2 6 .0 — 2.9 — 0.3 Quincy ......... + 3 2 .2 — 3.3 + 2.3 St. Louis......+ 1 4 .1 — 3.6 + 1 0 .1 Springfield ..+ 1 6 .5 — 9.9 — 13.5 8th District..+ 1 5 .9 — 4.1 + 6.8 Stock turnover Jan. 1, to Dec. 31, 1933 1932 1.34 1.15 2.25 2.26 3.10 2.64 3.19 3.02 2.58 2.31 3.63 3.60 1.50 1.33 3.30 3.18 Retail Stores Net sales comparison Dec. 1933 12 months ended comp, to Dec. 31, 1933 to Dec. 1932 same period 1932 Men’s Fur nishings ....+ 2 5 .4 % Boots and Shoes ........+ 0.2 Stocks on handStock turnover Dec. 31, 1933 Jan. 1, to comp, to Dec. 31, Dec. 31, 1932 1933 1932 — 1.2% + 2 5 .0 % 3.22 2.97 — 12.4 — 25.9 3.01 2.61 P O ST A L RECEIPTS Returns from the five largest cities of the dis trict show an increase o f 18.8 per cent in combined postal receipts for the final quarter of 1933 over the preceding three months, and a decrease of 7 per cent as contrasted with the last quarter of 1932. Detailed figures fo llo w : __________________ For Quarter Ended Dec. 1933 Dec. 31, Sept. 30, June 30, Dec. 31, comp, to 1933 1933 1933 1932 Dec. 1932 Evansville.... $ 130,008 $ 139,549 $ 136,219 $ 139,826 — 7.0% Little Rock.... 171,715 153,540 148,486 179,505 — 4.3 Louisville .... 617,313 540,284 586,831 644,721 — 4.3 Memphis ...... 543,508 448,329 447,551 543,380 — .02 St. Louis...... 2,562,155 2,107,190 2*396,873 2,818,143 — 9.1 Totals ........$4,024,699 $3,388,892 $3,715,960 $4,325,575 — 7.0 CONSUM PTION OF E L E C T R IC IT Y Public utilities companies in the five largest cities of the district report consumption of electric current by selected industrial customers in D ecem ber as being about 12 per cent smaller than in N ovem ber and 10.4 per cent larger than in D ecem ber, 1932. Detailed figures fo llo w : Dec., Nov., No. of Dec. 1933 comp, to Custom 1933 1933 ♦ K .W .H . ♦ K .W .H . Nov. 1933 ers 1,443 1,321 Evansville ... 40 + 9.2% Little Rock.. 35 1,235 1,332 — 7.3 — 7.0 Louisville .... 85 5,315 5,712 1,502 + 2 0 .2 Memphis ...... 31 1,806 1$,SSS** — 19.4 St. Louis „.,196™ 12,560 Totals ...... 387 22,359 ♦In thousands (000 omitted). ♦♦Revised figures. 25,452♦♦ — 12.2 Dec., Dec. 1933 comp, to 1932 ♦ K .W .H . Dec. 1932 1,484*# — 2.8% 1,158 + 6.6 5,026## + 5.8 + 4 0 .0 1,290 11,299#* + 11.2 20,257## + 10.4 B U IL D IN G The dollar value of permits issued for new con struction in the five largest cities of the district in Decem ber was 45.8 per cent less than in November, and 148.3 per cent more than in December, 1932. A ccordin g to statistics com piled by the F. W . D odge Corporation, construction contracts let in the Eighth District in Decem ber amounted to $19,986,036 which compares with $9,677,726 in Novem ber and $4,886,658 in December, 1932. Build ing figures for D ecem ber fo llo w : New Construction Permits ♦Cost 1933 1932 1932 1933 Evansville .. 70 5 $ 2 $ 6 8 7 1 1 Little Rock Louisville .. 16 14 31 17 Memphis ... 95 94 201 59 St. Louis.... 51 27 53 33 212 Dec. totals.. _ 175 $ 288 Nov. “ .. 363 281 531 Oct. “ .. 482 456 812 ♦In thousands (000 omitted). $ 116 213 1,063 _______ Repairs, etc. Permits ♦Cost 1933 1932 1933 1932 11 $ 21 — 84 6 7 33 36 12 15 15 11 62 26 66 123 39 62 94 84 288 318 466 269 273 490 $ 127 154 243 $128 133 247 A G R ICU LTU R E Taken as a w hole the winter to date in the Eighth District has been favorable for agricultural activities and development of fall sown crops. Abnorm ally high temperatures prevailed during most of December, the first really cold weather of the season being experienced in the last week of that month. Farmers were able to complete the final stages of harvesting and housing late crops under unusually auspicious conditions, and routine farm operations have been brought well up to the season al schedule. Considerable headway has been made in plowing for spring crops, especially in the cotton and rice areas. Precipitation during the early win ter was below normal, but the deficiency has been partially made up by rains and snows since January 1. For the most part winter wheat fields in the northern stretches o f the district had adequate snow protection and indications are for exceptionally light damage from winter killing. Winter Wheat — The area of winter wheat seeded last fall in states of the Eighth District was 5.731.000 acres, an increase of 7.1 per cent and 8.7 per cent, respectively, over the seedings in the fall of 1932 and the fall of 1931. In the principal pro ducing states, the Decem ber condition was equal to or higher than a year ago. Due mainly to curtail ment efforts by the Agricultural Adjustm ent A d ministration, seedings last fall in the country as a whole were smaller by 4 per cent than the revised estimate of acreage seeded in the fall of 1932 and 7.2 per cent less than the revised average acreage seeded (1929-1931) for crops harvested 1930 to 1932. W heat stocks on farms of Eighth District states as of January 1 were 8.8 per cent smaller than a year earlier and 30.8 per cent less than the 4-year (19311934) average. Generally through the district, wheat was sown subsequent to fly-free dates and under favorable soil conditions. Germination has been fairly uniform and made a good start during October. Novem ber weather was adversely dry and in many sections was accountable for slow growth. Mild temperatures with light rains in December improved surface soil conditions and was beneficial to growth. Corn — Stocks of corn on farms in states in cluding the Eighth District on January 1 were esti mated by the U. S. Department of Agriculture at 471.393.000 bushels, a decrease of 31 per cent under a year earlier and the smallest since January 1, 1931. W eather conditions in N ovem ber and Decem ber were ideal for development of the crop, and harvest ing and cribbing was accomplished earlier than average. Generally through the district fields are well cleaned up. Due to the mild winter, damage from frost was unusually light, and average quality of the crop is high. In states including the Eighth District the corn crop of 1933 is estimated by the U. S. Department o f Agriculture at 689,876,000 bushels, worth at Decem ber 1 farm prices, $275,601,000. In 1932 these states produced 968,882,000 bushels, but due to low prices, the larger output had an estimated value of only $181,181,000. L ive Stock — The favorable condition of live stock generally throughout the district which marked earlier months of the year, continued through December. Prices of cattle and hogs con tinued at or around the low levels which have pre vailed in recent months, despite which fact the movement to market was in considerable volume. Feed crops in states of the Eighth District were short and prices relatively high. A ll tame hay pro duction in these states in 1933 was estimated at 10,648,000 tons, with value of $85,423,000 which compares with 11,086,000 tons in 1932, with esti mated value o f $66,297,000. Receipts and shipments at St. Louis as reported b y the National Stock Yards, were as follow s: Receipts Dec., Nov., Dec., 1933 1933 1932 Cattle and Calves...... 87,443 100,660 65,695 Hogs ............................260,406 264,687 201,455 Horses and Mules...... 8,296 9,452 1,853 Sheep ............................ 35,435 41,933 43,869 Shipments Dec., Nov., Dec., 1933 1933 1932 41,192 47,424 38,559 128,559 132,231 159,342 9,151 9,413 1,692 7,749 7,791 12,209 The follow ing table shows comparative receipts and shipments for the years 1931, 1932, and 1933: 1933 Receipts 1932 1931 Cattle and Calves ......1,118,339 1,064,438 1,170,781 Hogs ........... 3,327,464 2,626,277 2,970,316 Horses and Mules ...... 69,026 35,518 40,101 710,905 660,897 Sheep .......... 658,652 Shipments 1933 1932 1931 552,441 631,826 755,140 1,857,274 1,946,818 2,321,835 69,152 145,562 33,571 197,033 40,655 220,027 Cotton — Production of cotton in the Eighth District in 1933, is estimated by the U. S. Depart ment of Agriculture in its December report at 2,350,000 bales, with value of $113,270,000 the value being based on Decem ber 1 farm prices. This compares with 2,635,000 bales in 1932, with value of $75,256,000 and 3,597,000 bales worth $109,529,000 in 1931. In addition to the larger proceeds from sales of their cotton, producers’ incomes were considerably aug mented by cash received for acreage plowed up, in connection with the Agricultural Administration’s campaign for crop reduction and Government loans of 10c per pound. Until the final week in December, weather conditions were auspicious for field work, and plow ing and general preparations for the new crop were considerably ahead of the average sea sonal schedule. A ctivity in the raw cotton markets which developed early this year has continued through the first three weeks of January. Inquiries from both dom estic consumers and exporters have shown marked improvement. Offerings continue relatively light, despite the upturn in prices. In the St. Louis market the middling grade ranged from 9.65c to 11.15c between Decem ber 15 and January 15, closing at 11.15c on the latter date, which com pares with 9.80c on Decem ber 15, and 5.75c on Janu ary 16, 1933. Receipts at Arkansas compresses from August 1, 1933, to January 12, 1934, totaled 915,683 bales, which compares with 1,078,505 bales for the corresponding period a year earlier. Stocks on hand as of January 12 were 604,114 bales, against 659,008 bales on December 8, 1933, and 651,354 bales on January 13, 1933. Tobacco — Sales at burley tobacco markets were resumed on January 8, follow ing the market ing holidays, during which interval deliveries to loose leaf warehouses were heavy. On several mar kets lower prices were paid than in December, and dissatisfaction am ong growers caused a further sus pension of sales. Elsewhere, however, prices realized were as high as when the season opened. A t the middle of January considerable irregularity existed in burley prices. The market for sale of dark fired tobacco at Clarksville, Tennessee opened on Decem ber 19, with average prices higher than a year ago. The dark fired markets at Hopkinsville, Ky., and Springfield, Tennessee, opened during the first week of January, with sales at Springfield at a general average of $12 per 100 pounds, $5 higher than early sales last year. Hopkinsville sales were relatively light, but at prices above a year ago. The western district mar kets opened the same week, with small offerings and somewhat higher prices than paid at initial sales in 1933. The one sucker and Green River mar kets opened the second week of January. In the former, leaf sold about the same levels as last year, but rehandling grades were from $1 to $2 higher and lugs $2 to $2.50 higher than paid for the 1932 crop. The average price at Green River sales was about $1.50 higher than the opening a year ago. C O M M O D ITY PRICES Range of prices in the St. Louis market be tween Decem ber 15, 1933, and January 15, 1934, with closing quotations on the latter date and on January 16, 1933, follow : Wheat July No. No. Corn High Low 1 1 ” .....* ...per bu..$ .91 $ .82 ................. .... “ .89 .82 H 2 red winter “ .92 5^ .82 2 hard “ .90 .81 .... “ .54 *July ................. .... “ .55*4 *Sept.................... .... “ .57 No. 2 mixed .... “ .5154 No. 2 white .. .... " .51 Oats No. 2 white .. .... “ .40 Flour Soft patent...... ...perbbl. 7.10 Spring “ ..... .... “ 7.10 Middling cotton....per lb. .1115 Hogs on hoof..... per cwt. 3.90 *Nominal quotations. ___________ Close_______________ Jan. 15, 1934 Jan. 16, 1933 $ .9 0 # $ .89 .92*4 $ .4954 @ A 9y2@ .90 .4754 $ .53$£@ .55y2 @ A9& .53*6 .48 .4554 .5334 .SStt .5 6 H .51*4 .51 .35 H .39 54 6.10 6.10 .0965 1.75 6.60 6.60 2.00 @ 7.10 @7.10 .1115 @ 3.50 A7% A7 .50 .50 .2554 .2 7V, .28*4 @ .28H .24 @ .2454 .23*4@ *24 .1754® .1754 3.10 3.75 2.10 @ 3.35 @ 4.00 .0575 @ 3.40 F IN A N C IA L Save where affected by seasonal influences, Eighth District financial and banking conditions underwent only minor changes during the past thirty days. Throughout Decem ber and the first week of January, demand for credit from com m er cial and industrial sources continued quiet, but since then moderate improvement has taken place, par ticularly in the large cities. The call for funds from agricultural sections was seasonally light, and coun try banks reported a considerable volum e of liqui dation; in turn these banks further reduced their loans from city correspondents and the Federal reserve bank. The usual augmented demand for funds in late Decem ber to meet interest and divi dend disbursements was in evidence, but this had no effect on the situation as a whole, amounting largely to a shifting of credits. Reflecting the ad vance in cereal prices since mid-January, some ex pansion in commitments of grain handling and flour milling interests is noted. Reserve balances of reporting member banks in the principal cities continued the increase of re cent months, and in the four-week period ended January 17, reached a new high record. Otherwise changes in the condition of these banks were neg ligible. Between Decem ber 20 and January 17, there was a decrease of 2.2 per cent in their total invest ments, due to smaller holdings of Government secur ities. A slight decline in total deposits was recorded, occasioned entirely by withdrawals of Government funds; custom ers’ demand deposits increasing 2.6 per cent, and demand deposits 2 per cent. Borrowings of all member banks from the Fed eral reserve bank fluctuated within a narrow range between Decem ber 18 and January 18, and through that period were uniformly greatly below a year earlier. The circulation of this bank decreased sea sonally during the first half o f January, reflecting the return flow o f currency follow ing the holidays. T he amount of savings deposits in selected banks on January 3 was 2 per cent less than on Decem ber 6, and 15 per cent less than on January 4, 1933. Quotably interest rates were little changed from the preceding thirty days, but since the second week in January the trend has been firmer, bankers report ing more loans made at the m ajor figures o f spreads in the several classifications than heretofore. A t St. Louis banks, as o f the week ended January 15, cur rent rates were as fo llo w s : Customers prime com mercial paper, 3 to 5 per cent; collateral loans, 4J4 to 6 per cent; loans secured by warehouse re ceipts, 2 to 6 per ce n t; interbank loans, 5 to Sy2 per cent and cattle loans, 5 to 6 per cent. Condition of Banks — Loans and discounts of the reporting member banks on January 17, 1934, showed a decrease of 3.5 per cent as contrasted with December 20, 1933. Deposits decreased 0.4 per cent between December 20, 1933 and January 17, 1934 and on the latter date were 4.8 per cent greater than on January 18, 1933. Composite statement follow s: ♦Jan. 17, 1934 Number of banks reporting............ 19 Loans and discounts (incl. rediscounts) Secured by U . S. Govt, obligations and other stocks and bonds....$ 90,188 All other loans and discounts.... 138,484 ♦Dec. 20, 1933 19 ♦Jan. 18, 1933 19 $ 91,359 145,597 $103,542 139,196 Total loans and discounts.................$228,672 Investments U . S. Govt, securities................. 143,820 Other securities.............................. 100,847 $236,956 $242,738 149,463 100,669 125,934 109,987 Total investments......... j......................$244,667 $250,132 $235,921 Reserve balance with F. R. Bank.. 70,352 Cash in vault....................................... 7,980 Deposits Net demand deposits.................... 316,185 Time deposits.................................. 159,214 Government deposits..................... 7,837 60,573 10,704 41,059 14,554 308,207 156,115 20,648 289,161 169,261 2,635 $484,970 $461,057 180 3,100 Total deposits......................................$483,236 Bills payable and rediscounts with Federal Reserve Bank................... 230 ♦In thousands (000 omitted). Federal Reserve Operations — During D ecem ber, the Federal Reserve Bank of St. Louis dis counted for 55 member banks against 51 in N ovem ber, and 197 in December, 1932. The discount rate remained unchanged at 3 per cent. Changes in the principal assets and liabilities of this institution appear in the follow ing ta b le: ♦Jan. 18, 1934 .$ 1,226 . 4,383 . 93,200 ♦Dec. 18, 1933 $ 1,454 5,097 93,200 *J.an. 18, 1933 $ 9,023 155 ........ 160 ........946 Total Bills and Securities....................♦$ 98,964 .$ 98,964 $ 99,911 $ 73,222 .$183,955 . 127,699 . 138,372 $168,021 105,471 144,900 $143,901 68,379 137,085 67.1% 70.0% U. S. Securities....................................... Federal Inter. Cr. Bk. Debentures. Participation in Inv. Foreign Banks.... Ratio of reserve to deposits and F. R. Note Liabilities.......... ♦In thousands (000 omitted). . 69.1% 63,253 Debits to Individual Accounts — The follow ing table gives the total debits charged by banks to checking accounts, savings accounts, certificates of deposit accounts and trust accounts of individuals, firms, corporations and U. S. Government in leading cities of the district. Charges to accounts of banks are not included. *Dec., 1933 East St. Louis and Natl. Stock Yards, 111..$ 17,495 El Dorado, Ark..... 3,654 Evansville, Ind.... 15,558 Fort Smith, Ark.... 7,577 Greenville, Miss.... 3,458 Helena, Ark.......... 1,654 Little Rock, Ark... 19,154 Louisville, K y ........ 125,683 Memphis, Tenn..... 105,424 Owensboro, K y..... 2,857 Pine Bluff, Ark.... 4,494 Quincy, 111............. 5,081 St. Louis, M o........ 447,680 Sedalia, M o............ 1,443 Springfield, M o..... 9,920 ♦♦Texarkana, Ark.-Tex ....... 5,585 Totals .....................$776,717 ♦Nov., 1933 ♦Dec., 1932 Dec. 1933 comp, to Nov. 1933 Dec. 1932 $ 18,420 2,925 13,373 7,905 4,050 2,279 18,076 105,642 125,333 2,351 5,978 4,171 376,550 1,141 8,348 $ 16,637 3,306 13,872 6,711 2,819 1,326 17,712 106,940 80,209 2,844 4,385 5,094 438,060 1,462 8,957 5,064 5,026 + 1 0 .3 + 1 1 .1 $701,606 $715,360 + 1 0 .7 + — 5.09! + 2 4 .9 + 16.3 — 4.1 — 14.6 — 27.4 + 6.0 + 19.0 + 5.2% + 10.5 +112.2 + 2 .9 + 2 2 .7 + 2 4 .7 + + 1 7 .5 + 3 1 .4 + 0.5 + 2.5 — 0.3 + 2 6 .5 + 18.8 — 1.3 +21.8 + 18.9 + 2.2 +10.8 ♦In thousands (000 omitted). ♦♦Includes one bank in Texarkana, Texas not in Eighth District. (Com piled January 22, 1934) 8.1 — 15.9 + 2 1 .5 — 24.8 8.6 BUSINESS CONDITIONS IN T H E U N ITED STATES Industrial activity, as measured by the Federal Reserve Board’s seasonally adjusted index, showed an increase in Decem ber, following upon four months of decline. Factory employment declined somewhat, while employment by public agencies showed a considerable increase. DISTRIBU TIO N — Freight car-loadings, particularly of miscellaneous freight, declined in December as compared with November by less than the usual seasonal amount. Dollar value of sales by department stores showed an increase slightly larger than is usual for December. PRODUCTION AN D EM PLO YM ENT — The Board’s in dex of industrial production, which is adjusted to allow for sea sonal variation, advanced from 73 per cent of the 1923-1925 aver age in November to 74 per cent in December. For the fourth quarter of 1933 as a whole the volume of industrial output was 13 DO LLAR EXCH ANG E — The foreign exchange value of the dollar, which had fluctuated around 64 per cent of parity from the end of November to January 13, declined to 62 per cent on January 17, and subsequently advanced to a range from 62 to 63 per cent. per cent larger than for the corresponding period of 1932. Activi ty in the steel industry, contrary to seasonal tendency, increased considerably in December and there was also an increase in the output o f automobiles. Shoe production declined by an amount smaller than is usual in December. At textile mills, activity de clined further by considerably more than the usual seasonal amount to about the low level of last spring. The number of employees at factories declined between the middle of November and the middle of December by somewhat more than the usual seasonal amount, reflecting chiefly reductions in working forces at cotton, woolen, and silk mills and at clothing factories. At automobile factories there was a substantial increase in employ ment. PRICES — Wholesale commodity prices, which had shown a slight decline between the middle of November and the third week of December, advanced in the following month, reflecting chiefly increases in the prices of farm products and foods. Cotton and grains showed marked increases and livestock prices also advanced somewhat. BANK CREDIT — A t the reserve banks the seasonal return of currency from circulation after the holiday demand amounted to about $250,000,000 from the high point on December 22 to Janu ary 17. A large part of the funds arising from this inflow of cur rency to the reserve banks was added to the reserve balances of member banks, with the consequence that these balances increased by January 17 to $900,000,000 in excess of legal requirements. The return flow of currency from circulation and the reduction of bal- Three month moving averages of F. W . Podge data for 37 Eastern States, adjusted for seasonal variation. Latest figure based on data for November, December and estimate for January. i Indexes of the United States Bureau of Labor Statistics. By months 1929 to 1931; by weeks 1932 to date. (1926=100.) Latest figures January 13 and January 20 respectively, farm products, 58.6, 59.0; foods, 64.2, 64.6; other commodities, 77.9, 78.6. Value of construction contracts awarded, as reported by the F. W . Dodge Corporation, increased further in December and the first half of January. There was a large increase in contracts awarded for public works and private construction also increased. In the fourth quarter of 1933 as a whole, construction contracts in 37 states totaled $500,000,000 as compared with $300,000,000 in the last quarter of 1932. ances held by commercial banks for the United States Govern ment were reflected in an increase of demand deposits at report ing member banks. Loans o f the banks declined between Decem ber 13 and January 17, while holdings of United States Govern ment and other securities increased. Short term money rates in the open market, which had shown a slight advance in December, declined in January to the previous level.