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F E D E R A L E I S 1 E T B O A R D  „ -

STATEMENT  FOR THE   PRESS

F o r

  r e l e a s e

  i n

  Morning Pa pe rs ,

Monday, August  2 7 , 1 9 2 8 .

T he  f o l l o w i n g  i s a   summary  o f  g e n e r a l

b u s i n e s s  a n d   f i n a n c i a l c o n d i t i o n s

th roughout  t h e   seve ra l Fede ra l Rese rve

D i s t r i c t s , " based u p on s t a t i s t i c s  f o r

t h e  months  o f   J u l y  a n d   August ,  a s   w i l l

appea r

  i n t h e

  f o r t h c o m in g i s s u e

  o f t h e

F e d e r a l R e s e r v e B u l l e t i n

  a n d t h e

  monthly

r e p o r t s  o f t h e   F e d e r a l r e s e r v e h a n k s .

I n d u s t r i a l

  a n d

  t r a d e a c t i v i t y

  w a s i n

  la rger volume

  i n

  J u ly t h a n

  i s

  usua l

i n  midsummer  a n d t h e   g e n e r a l l e v e l  o f   commodi ty p r ic e s advanced s l i g h t l y .  Mem-

b e r  h a n k h o ld in g s  o f   s e c u r i t i e s  a n d   l o a n s  o n   s e c u r i t i e s de c l i n ed  i n   J u l y  an d

August , whi le

  a l l

  o th e r l o a n s i n c r e a s e d

  t o t h e

  h i g h e s t l e v e l

  o n

  re co rd . Condi-

t i o n s  i n t h e   money market rema ined f i rm .

P r o d u c t i o n — P r o d u c t i o n  o f   m a n u f a c t u r e s  a n d   minera ls showed  a   s m a l l e r  d e -

c r e a s e t h a n u s u a l

  i n

  J u l y ,

  a n d t h e

  index

  o f

  in du s t r i a l ' p r od uc t ion , which makes

a l lowance  f o r   s e a s o n a l v a r i a t i o n s , a d v an c e d. P r o d u c t i o n  o f   s t e e l , b i t u m in o u s

c o a l , p e t r o l e u m , a u to m o b i l e s ,

  a n d

  foo twea r

  w a s

  l a r g e r

  i n

  Ju ly than

  i n

  June , whi le

a c t i v i t y  i n   t e x t i l e m i l l s , m ea t p a c k i ng ,  a n d   coppe r  a n d   a n th r a c i t e m in e s d e c l i n e d .

Lumber pr od uc ti on showed l e s s t han  t h e   u s u a l s e a s o n a l d e c r e a s e . S t e e l m i l l a c t i v -

i t y ,

  w h i l e d u r in g J u ly

  w a s a t a n

  u n u s u a l l y h i g h l e v e l

  f o r t h e

  summer season,

  w as

wel l ma in ta i ned dur ing Augus t . Weekly re po r t s f rom De t r o i t f a c t o r i e s show  a

la rger volume  o f   employment  i n t h e   m id d l e  o f  August than  a t a n y   p r e v io u s d a t e ,

i n d i c a t i n g t h a t a u to m o b i l e p r o d u c t i o n c o n t i n u e d l a r g e

  i n

  t ha t month. Bu i l di ng

c o n t r a c t s a w a r d e d d e c l i n e d  b y   somewhat more than  t h e   usua l seasona l amount  i n

J u l y ,  b u t  we re l a rge r than  i n a n y   p r e v i o u s J u l y ,  t h e   in c r ea se ove r l a s t yea r

b e i n g c h i e f l y  i n   r e s i d e n t i a l b u i l d i n g  .  Con t ra c t s awarded  i n t h e   f i r s t  two

weeks

  i n

  August we re s l i g h t l y sma l le r than

  i n t h e

  same pe r i od

  o f

  l a s t y e a r .

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, i - -

, w

• E s t i m a t e s  o f t h e   Department  o f   A g r i c u l t u r e  a s o f   August  1   i n d i c a t e c o n s i d e r a b l e

improvement  i n   c rop con d i t ion s du r ing Ju ly . Es t ima te d whea t p rod uc t ion  w as

8 9 1 ,00 0 ,0 00 b u s h e l s , l a r g e r

  b y

  91 ,000 ,000 than on , J u l y

  1 a n d

  s l i g h t l y l a r g e r

than  t h e   y i e l d  i n 1 9 2 7 . T h e   corn crop  i s   e x p e c t e d  t o b e   more than 3,000,000,000

b u s h e l s ,

  a n

  i n c r e a s e

  o f

  750 ,000 ,000 bus he l s f rom l a s t yea r . Fo r ec as t s

  f o r

  o ther

g ra in c rops were a l s o l a rg e r t han   t h e   J u l y  1   e s t i m a t e s  a n d i n   most cases exceeded

l a s t y e a r ' s y i e l d s .

  T h e

  August

  1

  f o r e c a s t

  o f

  c o t t o n p r o d u c t i o n

  w a s

  14 ,290,000,

a s  compared wi t h y ie ld s  o f   12 ,955 ,000 ba le s  i n 1927 and   nea r ly 18 ,000 ,000 ba les

i n 1 9 2 6 .

T r a d e — D i s t r i b u t i o n

  o f

  commodit ies

  a t

  w h o l e s a l e

  a n d

  r e t a i l

  w a s i n

  l a r g e

volume  i n   J u l y . S a l e s  o f d r y   goods  a n d   shoes  a t   who le sa l e were l a rg e r t han  i n

J u n e ,

  a n d

  t h o s e

  o f

  o th e r l i n e s were on l y s l i g h t l y sma l l e r . Depar tment s t o r e

s a l e s , a f t e r a l l ow a n ce  f o r   season a l changes , i nc rea sed  i n   J u l y . Compared wi th

J u l y

  a

  y e a r

  a g o

  t r a d e

  o f

  b o th who les a l e

  a n d

  r e t a i l f i r m s

  wae -

  l a r g e r . S t oc k s

  o f

o f

depar tmen t s t o r es and /who les a l e f i rm s con t inu ed smal l e r t ha na yea r  a g o .

F r e i g h t - c a r l o a d i n g s i n c r e a s e d

  b y

  more than

  t h e

  usual seasonal amount

  i n

J u l y  a n d

  o

t h e  f i r s t t ime th i s yea r were l a rg e r t han  i n t h e   co r r espond ing

month

  o f 1 9 2 7 .

  In c r ea se s , compared wi t h l a s t yea r , were r e po r t ed

  i n

  load ings

o f  misce l l aneous commodi t i e s  a n d o f   g r a in , r e f l e c t i n g  t h e   e a r l y h a r v e s t i n g  o f

t h e

  c r o p t h i s y e a r .

  T h e

  l a r g e s t d e c r e a s e ,

  a s

  compared wi t h

  a

  yea r

  a g o , w a s i n

l i ve s t oc k sh ipmen t s . During  t h e   f i r s t  tw o   weeks  i n   Augus t, t o t a l l oa d in gs were

i n

  about

  t h e

  same volume

  a s i n t h e

  c or r esp ond ing weeks

  o f

  l a s t y e a r .

P r i c e s — T h e g e n e r a l l e v e l  o f   who les a l e commodi ty p r i c e s inc rea se d s l ig h t l y

i n  J u l y r e f l e c t i n g c h i e f l y a dv an ce s  i n t h e   p r i c e s  o f   l i v e s t o c k  a n d   mea ts , a l tho ugh

th e r e were a l so smal l i nc re as es  i n   h i d e  a n d   l e a t h e r p r o d u c t s , t e x t i l e s , p e t ro l e um

p r o d u c t s ,  a n d   b u i l d i n g m a t e r i a l s . T he re  w as a   s h a r p d e c l i n e  i n t h e   p r i c e  o f

gra ins , o the r t han co rn ,

  a n d

  some decrease

  i n

  chemica l s

  a n d

  d r u g s , s i l k , r u b b e r ,

a n d  a u t o m ob i l e t i r e s . D a ri n g  t h e   f i r s t h a l f  o f   August there were increases  i n

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t h e  p r i c e s  o f   sugar , hogs  a n d   po rk p ro duc t s , coke ,  a n d   lumber,  a n d   d e c r e a s e s  i n

gr a i ns , co t to n , woo l

  a n d

  h i d e s .

Bank Credit—Between July  1 8 an d   August  1 5   t o t a l lo a n s  a n d   i n v e s t m e n t s  o f

member banks  i n   l e a d i n g c i t i e s d e c re a s e d  b y   about $130,000,000 . This dec l i ne  r e -

f l e c t e d  a   c o n s i d e r a b l e r e d u c t i o n  i n   i n v e s t m e n t s , c h i e f l y  a t   banks  in Hew   York

C i t y ,

  a n d

  some fu r t h e r dec l in e

  i n

  loans

  o n

  s e c u r i t i e s .

  A l l

  other loans, which

inc lude loans

  f o r

  commercial pu rp os es , showed

  a

  smal l seasona l i nc rease

  a n d a t

t h e  middle  o f   August were  i n t h e   l a rges t vo lume s ince ea r ly  i n 1 9 2 1 a n d   n e a r l y

$230,000,000 larger than

  a t t h e

  autumn peak

  o f

  l a s t yea r . There -was-a fu r th e r - ' l a rg e

d e c l i n e  i n n e t   demand de po si t s ,  a n d   p r a c t i c a l l y  n o   change  i n   t ime depos i t s .

Volume  o f   re se rv e bank cr ed i t ou ts ta nd in g showed l i t t l e change between Ju ly

2 5 a n d  August  2 2 .  Di scoun t s  a n d   a c ce p t a n c e h o l d i n g s i n c r e a s e d s l i g h t l y w h i l e

Uni t ed S t a t e s se cu r i ty ho ld i ngs were p r a c t i c a l l y unchanged . Inc rea sed demand

f o r

  cur rency, which

  i s

  u s u a l

  a t

  th is t ime

  o f t h e

  y e a r ,

  h a s n o t

  r e s u l t e d

  in an

equ iva len t g rowth  i n   r e s e r v e b a n k c r e d i t , b e c a u s e  i t w a s  o f f s e t  i n   p a r t  by a

d e c l i n e  i n   r e s e r v e s r e q u i r e d  b y   member banks, which ref lec ted  t h e   d e c r e a s e  i n

t h e i r d e p o s i t s .

There were f u r t h e r inc re as es between

  t h e

  midd le

  o f

  J u l y

  a n d t h e

  midd le

  o f

August  i n   open-marke t r a t e s  o n   co l l a t e r a l l oan s , commerc ia l paper  a n d   banker s '

accep tances .