Economic Review
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M ONTHLY BUSINESS REVIEW Covering Conditions in the Sixth Federal Reserve D istrict. FEDERAL RESERVE BANK OF ATLANTA OSOAR NEWTON, WARD ALBERTSON. Chairm an and Federal Reserve Agent (Com piled September 17, 1926) Assistant Federal Reserve Agent This Review released for publication in VOL. 11, No. 9 ATLANTA, GA., SEPTEMBER 30, 1926 morning papers of September 30. BUSINESS CONDITIONS IN THE UNITED STATES. (Prepared by the Federal Reserve Board.) Industrial activity and distribution of commodities those of groceries and hardware were larger. Inventories continued in large volume in August at a level higher than of department stores increased in preparation for autum n a year ago. The general level of wholesale prices receded trade, but this increase was less than is usual at this sea further in August, reflecting price declines for agricul son and at the end of the m onth stocks were smaller than tural commodities. a year ago. Freight car loadings in August continued higher than in the corresponding months of previous Production The index of production in basic in years and for the weeks of August 28 and September 4 dustries, which is adjusted for the exceeded all previous weekly records. Loadings of grain usual seasonal variations, declined slightly in August, continued larger and shipments of merchandise in less but this decline was accounted for by the fact that there than carload lots, miscellaneous commodities, ore, and were five Sundays inAugust as against f our in July. Textile coke were considerably larger than in the corresponding mill activity and production of steel ingots, zinc, and pe period of previous years. troleum increased, while the output of pig iron, lumber, coal, copper, cement, and sugar was smaller than the Prices Wholesale commodity prices, according month before. Automobile production increased con to the index of the Bureau of Labor siderably inAugust and was larger than in any month Statistics declined by over 1 per cent in August, reflecting since April. Factory employment and payrolls, after de largely prices decreases for grains, live stock, and meat clining in July, increased in August, as is usual at this products. Price of clothing materials, fuels, and metals season of the year. Building activity, as measured by increased between July and August, while prices of cot* contract awards in 37 states east of the Rocky M ountains, ton, wool, sugar, building materials, and rubber showed was in larger volume in August than in July or in any other little change. In the first half of September prices of previous month with the exception of August 1925. In grains, cattle, sugar, bitum inous coal, and coke advanced, eastern and southeastern states the volume of building while prices of raw cotton, silver, and bricks declined. was smaller in August than a year ago, while in the middle west contracts awarded were larger. Contracts for re Bank Credit Increased demand for bank credit in sidential structures were smaller than last year, while connection with the harvesting and those for industrial buildings and for public works and marketing of crops and autum n trade, together with an public utilities were substantially larger. Crop condi increase in loans on securities, was reflected in a con tions improved in August according to a statem ent by the siderable growth between the middle of August and the Departm ent of Agriculture. September forecasts of yields middle of September in loans of member banks in leading of corn, barley, hay, tobacco, and most fruit and vegetable cities. The banks’ holdings of investm ents also increased, crops were above those made in August, while expected though there was a decrease in investments at banks in yields of oats and spring wheat were slightly less. A cot New York City, and total loans and investments on Sep ton crop of 15,810,000 bales was indicated on the basis of tember 15 were larger than at any previous time. The the condition of the crop at the middle of September. The volume of Reserve B ank credit increased by about $90,000,000 crop, however, is later than last year and ginnings up to between August 18 and September 22, partly in response to September 16 amounted to only 2,511,000 bales, compared seasonal demands for currency. Discounts for member w ith 4,282,000, bales prior to September 16, 1925. banks rose in September to the highest figure for the year, and acceptance holdings also increased, while United Trade Volume of wholesale trade and of States securities declined by about $55,000,000. sales at department stores increased Money rates continued to rise in September. Rates on in August and retail sales were larger than a year ago. commercial paper advanced by one fourth per cent to 4£- Stocks of dry goods and shoes carried by wholesale firms 4| per cent, and rates on security loans also averaged high were smaller at the end of August than last year, while er than in August. PER CENT PER CENT Index of 22 basic com m odities a6justed for seasonal variations (1919— 100.) Index of U nited States Bureau of Labor Statistics. (1913— 100, base adopted Digitized for FRASER VvtrVvMrafm 1 T.ntftat fls'iirA August 149.2. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis 9 THE MONTHLY BUSINESS REVIEW PER CENT PER CENT M onthly averages of daily figures for 12 Federal Reserve Banks, L a t e s t F e d e r a l R eserv e B o a r d ’s in d ex e s of e m p lo y m e n t a n d p a y -ro lls (1919-100). figures are averages of first 23 days of September Latest figures August 1926. Employment 94.4; Pay Rolls 107.7 SIXTH DISTRICT SUMMARY. consumption of cotton in the cotton-growing states in August was 18.9 per cent greater than a year ago. Coal While seasonal improvement is evident from some of the mining in Alabama and Tennessee was less than a year series of business statistics for August, not all of these ago, but the production of pig iron in Alabama showed series show favorable comparisons with figures for the an increase of 4.4 per cent. The average price prevailing corresponding periods last year. The Florida citrus crop for turpentine was less than at this time last year, but is estim ated at about 2,300,000 boxes greater than last year, the average price of rosin was higher. but this is based upon the condition on September 1 and does not take into consideration the damage done to the RETAIL TRADE. crop by the recent storm and which has not yet been ac curately estimated. The Louisiana sugar crop is esti Some recovery in retail trade in the sixth district during mated at considerably less than the crop produced last August is evidenced by the rise in the index number of year, but the production of rice is estimated at nearly a department store sales, computed from figures reported m illion bushels greater than a year ago. by 39 stores, from 83.9 in Ju ly to 87.3 in August, the highest figure recorded for any August since 1920. The individual The volume of retail trade in the sixth district was 8.4 index numbers for Atlanta, Birmingham, Nashville and per cent greater for August 1926 than for the correspond New Orleans showed increases in August, but declines ing m onth last year, and for the eight m onths of 1926 shows occurred at Chattanooga, Savannah and “Other Cities”. an increase of 6.9 per cent over the same period of 1925. Compared w ith August last year, sales reported by 45 de Wholesale trade statistics show seasonal improvement in partm ent stores in August 1926 showed an increase of 8.4 all reporting lines over the preceding month, but on the per cent, and for the first eight m onths of 1926 sales have whole is in smaller volume than for August last year. A exceeded those in the same period last year by 6.9 per cent. decline of 7 per cent in the general level of wholesale prices Stocks of m erchandise on hand at the end of August were m ust, however, be taken into consideration in connection 1.7 per cent smaller than a year ago, but increased 1.2 per with these sales statistics. Savings deposits at the end cent over those on hand at the end of July. The rate of of August were 8.2 per cent greater than a year ago. Debits turnover, indicated by the relation of sales to average to individual accounts during August at 24 reporting cities stocks, was slightly better in August this year than a of the district were tw o-tenths of one per cent sm aller than year ago, but for the year through August the rate has in August 1925. Loans by member banks in selected cities been slightly less rapid. Outstanding orders reported for on the 15th of September were somewhat smaller in total August were 29.6 per cent greater than a month earlier, volume than a year ago, but investm ents of these banks and 8.1 per cent greater than a year ago. Accounts re were greater than at that time. Discounts by the Federal ceivable at the end of August were six-tenths of one per Reserve Bank for its member banks were considerably cent smaller than a m onth ago, and 21.6 per cent greater greater in volume than a year ago.