September 1926
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MONTHLY REVIEW OF AGRICULTURAL AND BL7SINESS C~NDITI~NS IN TH E NINTH FEDERAL RESERVE DISTRICT Joxx R. M:rcx>su., Chairman of tkc lloard Cmaxzs L. Mosasx J. F. Easssoz.: and Federal Reserve Agent Aesiatant Federal Reserve Agents Vnl. lIl 1No.r1441 Minneapolis, Minnesota September 28, 19~b DISTRICT SUMMARY FOR THE MONTH a year earlier, However, check payments through banks in these cities were one-third less than The volume of business in this in district in August, August of last year. measured either by check payments through banks in seventeen reporting cities or by total carloadings, Recent crop forecasts of the Department of Agri- other than of iron ore, was less than last. year. Small culture for the feed crops of vats, barley and hay in gains were shown in the carloadings of miscellaneous Minnesota, North Dakota, South Dakota and Mon- merchandise. Sales reported in August by depart- tana, indicate declines of one third as compared with ment stores in the larger cities, by retail lumber last year. In connection with this forecast, it is im- yards scattered throughout the district and by whole- portant to note that the largest declines in August salers (except of groceries} were all below last year, grain receipts at terminals in this district were shown Gains were shown in shipments by lumber manu- far vats and barley, amounting, respectively, to 10 facturers and in copper production, but declines million and 5 million bushels. Some increase in de- tank place in flour and in linseed production . mand for the feed grains is suggested by a move- ment of feeder cattle 2 per cent larger As compared with the preceding month, the in August than last year, and shipments of hogs and sheep for volume of business in August, as measured by Feeding purposes more than double last year. check payments through banks, declined 7 per cent, whereas in the preceding years, there has cus- I"'rospective business activity based upon building tomarily been nv change shown. This is to be ac- operations, as reflected in the valuation of building counted for largely by a substantial decline in the permits granted during August in eighteen represen- receipts of hogs at terminals, by a failure of cattle tative cities of this district, was l6 per cent better receipts to show the usual seasonal increase, by than last year and 33 per cent better than in July. lower prices for aII grains, except corn and flax, and `hhe cities having more than a doubled valuation by a substantial decline in the price of hogs" of permits as compared with August of last year, were Aberdeen, Butte, Rochester, 5t. Cloud, Su- Duluth-Superior and the iron range territory perior and Winona . made a very favorable showing in August. Ship- ments and carloadings of iron ore in August were A satisfactory picture of the banking situation in one-fourth larger than a year previous, and were the Ninth Federal Reserve District at the opening of also larger than in ]uly. In consequence, the cumu- this crap year as contrasted with that of a year ago, lative total of shipments of iron ore for the sea- may be obtained by comparing the totals of import- son to August 31 was better than on a par with last ant items in the balance sheets of all banks within year. Wheat receipts at IJuluth-Superior in August the four complete states of this district as of June were 2 million bushels greater than last year. The 30, 192b and June 30, 1925, Such a comparison total valuation of building permits issued during shows improvement in the Iaan position but greater August in these two cities was one-half greater than utilization of reserves. The loan item, made up Pe~cenl __ 7. _ _ . ___ _, ._....._. _-_._. 150 _.- ...__ ._ . _. ...-__ _. I i la o _ _. ~ i~1~A 11 I . r- I fvi~ ealork 5p ____~.- .. .. 4_ ~.__._ . ._ . _ . .__ -_._.. ~ 3~.. - . 1.9 ~~ .1~~ C-L"f~_ . F~ .r..~ Carlaadings of Livestock in the Northwestern District, by CarIoadings of Grain sad Grain Products in the North- Months, 1919-1926_ Curve adjusted to eliminate seasonal western District, 1919-192fi. Cixrve adjusted to eliminate changes. seasonal chazxges. 262 AGRICULTURAL AND BUSINESS C~NDITI~NS Sepiemher2$, 19zb .4 10 6 4 Z _~" ~-1 ~ 0 Debits to lxxdividual Accounts at Banks in Cities of the Ninth Valuation of Building Permits issued at 18 Cities in the Federal Reserve District . Heavy curve represents fir;ures Ninth Federal Reserve District. Light curve, actual figures; adjusted to eliminate seasonal changes; light curve repre- 12 months moving average. sents actual figures. The "Eleven Cities" include Minne" heavy curve, apolis, St. Paul, Duluth and eight others . _-_--.... ._ i..-... ~.. ... --..--- .._.-._ largely of loans to customers, was reduced 65 mil- __ ._..,~...~...--...__.-. a ~W17CdT '- lion dollars. Holdings of United States and other Bz~rCirlr ., -__ investment securities-"secondary resexves"---=were .._ ~ -- increased 3fi millions and borrowed money fxvm the ~~ -_ ~^h __'_-. l - . .- .--_ Federal Reserve Sank and correspondent banks was I 1 reduced 5 millions. On June 3Q, 1925, there was ..... - ...- .___ ._+ f _ deposits resulting from the unusually a holdover of _ ___ _ . .- ._ __-_ , large proceeds of the 1924 craps. In the year fol- ,a, lowing, these were drawn upon, the reduction being 21 millions for time deposits, 1 1 millions far de- 'r I _ . mand deposits and 6 millions far cash on hand and y~ ~- ..'~ ..-..-~-~ 1 1 -~-.'- I-~J net balance with correspondent banks (i. e., "due I 1 9 ~~ ~9 2 ~- .I . .. .. .'4 ' j._ .i from banks" less "due to banks" ) . Valuation of Building Permits Issued of 4 Wheat Belt Cities. Reports received from selected member hanks (Forgo, N. D. ; Great Falls and Helena, Sl+lant.; Aberdeen, S. D.) Light curve, actual figures; heavy curve, 12 months located in the larger cities of this district, show that mvviag average. the total of their loans increased 1 ~/2 million dol- lars between July 28 and August 25, and an ad- TOPICAL REVIEWS ditional 4 ~/2 millions between the latter date and Durum wheat growers in the Northwest are September 1 5. A decrease in loans on securities was favored by a fortunate accident of poor crops in more than offset by an increase of $9,000,UOU in holy, Maxacca and Tunis, which has lifted the price other loans. The loans of this Federal Reserve Sank of durum wheat relative to the price of bread wheat were 1 million dollars less at the end than at the to an unusual extent. This fact has reduced the loss beginning of these seven weeks. The weighted which has been expected due tv the pavx yields of average of interest rates charged locally by the the northwestern durum crop this year. With a large larger banks had advanced by 5eptemher 15 to a United States bread wheat crop and, seemingly, an point higher than at any time since August 15, adequate foreign supply of bread wheat, the 1924. median price of Nv. 1 Dark Northern wheat at Min- l . ...-.- .. w__-- _ -. ._i -__... f F ~24~~-. ..-.. sMzs.--__._--.___.f.. ..: v2s ... lnterest Rates Charged by Representative Minneapolis Banks Median Cash Prices of $read Wheat at Minneapolis and on Prime Loans, 1919-192fi . The rate shown is a weighted Durum Wheat at Duluth, 1924-1926. No. 1 Dark Northern average of rates quoted on four classes of loans. Spring Wheat and No. 2 Amber Durum are the grades used. NINTH FEDERAL RESERVE DISTRICT Z63 neapvlis dropped 20 cents between July and Paul newspaper l~ugust commenced. on September 1, i 925 this year and was 10 cents per bushel to encourage the greater use of its lower in August than a year ago. The median "situations price ~cvanted" columns fox some classes of business cards, of No. 2 Amber Durum wheat, on the contxary, de- such as those of cxeased seamstresses and laundresses, by re- only 2 cents between July and August and ducing its charges from 70c for two was 2 1 cents higher than a year ago. lines of type to As a result, 25c Far there lines vF type" The result has been a durum said 3 cents aver bread wheat in August, great increase in the use of this 1926, far the grades mentioned, medium of advertis- as compared with ing, as shown in the "Situations Wanted" curve fox 28 cents under bread wheat in August last year. St. Paul on page 265 . The United States durum wheat crop this year is 27 3. The per cent smaller than the crop a year ago, but if the variation in volume of employment ad- higher prices prevailing are vertising between week days and Sundays is maintained, the cash pronounced vexy returns from durum wheat in the Northwest will be and, consequently, some of the fluctua- only 16 per cent smaller than last year. tions in employment advertising are accounted for by some months containing five "Help Sundays and others Wanted" and "Situations Wanted" Advertis- containing four Sundays" During the seven years, ing in Minneapolis and St. Paul Newspapers 1919-1925 there were twenty.-nine months contain- ing Beginning with January, 1919, this office col- five Sundays and fifty-five months containing lected monthly data four Sundays. The months containing five covering the number of "flelp have Sundays Wanted" and "Situations Wanted" advertisements been starred in the chart an page 265, in one important Minneapolis newspaper.