Evening star., 1931-12-26
RESERVE BULLETIN
REVIEWS BUSINESS.
Seasonal Changes Noted in
lndustry-Credit Demand
loWer-Crops Larger.

Industrial activity and factory en-
plcyment declined further from Octo-
ber to November, rejecting In part the
usual seasonal tendencies. Continued
gold imports and further reduction in
member bank reserve requirements dur
ing November and the first half of
december were reflected In a consid-
erable decline in the outstanding
volume Of Reserve bank credit, says the
Federal Reserve Boards latest bulletin
In November industrial production
showed a somewhat larger decrease
than Is usual at this season, and the
boards seasonally adjusted index de-
clined from 73 to 70 per cent of the
l923-1925 average. Activity declined at
Woolen mills, lumber mills and coal
mines. while daily average output at
steel mills increased and volume of
automobile production showed less than
the usual seasonal decline from the low
level OF October. The November in
crease in steel production was followed
by a considerable decline in the first
three weeks of December Output of
petroleum increased further in No.
vember to level slightly lower than
that prevailing last Summer before out
put was sharply curtailed.
Volume of employment in most
manufacturing industries, the bulletin
States declined by more than the sea-
sonal amount between the middle of
october and the middle of November.
reductions were particularly large in
the wearing apparel, leather and build
ing material industries, while in the au-
tomobile and tire industries declines
were smaller than usual at this season.
Crops Up 10 Per Cent.
The value Of building contracts
awarded, as reported by the F. w.
Dodge Corporation, has declined further
IN recent months and preliminary
estimate OF the boards seasonally ad-
lusted index for the last quarter of 1881
Is 49 per cent of the 1e23-l925 average,
compared with SO for the third quarter,
65 for the second quarter and 10 for
the nrst quarter Of the year; part of
this decline in dollar volume reflects
lower building costs.
Production Of principal crops in 1881
was about 10 per cent larger than in
1880, according to the December crop
report OF the Department of Agricul-
ture, While acreage harvested was
slightly smaller than year ago. There
were large increases in the crops of
cotton, corn. Winter wheat, apples and
peaches, while the harvests of oats, bar
year: as In 1880 the hay crop was un-
usually small
Commodity distribution continued at
about the same rate in November as in
october. the volume of freight-car
loadings showing a seasonal decline.
while sales at department stores in
creased by about the usual amount for
that month.
Commodity Prices Drop.
The general level of wholesale prices
renamed practically unchanged from
october to November, according to the
Bureau OF Labor Statistics ndex,
prices of grains, petroleum and silver
advanced, while those Of live stock and
dairy products showed declines, partly
OF a seasonal character. Between the
middle Of November and the middle of
December there were decreases in the
prices OF many leading commodities in
Guiding live stock, meats, grains, sugar,
SILK and silver: during this period
prices of copper and rubber showed a
decline, followed by recovery.
Volume of reserve bank credit out
standing declined during November and
the first half of December, and aver
aged $3.50, 900 less In the week end
ing December IL than at its October
peak, seven weeks earlies. The de-
crease was in large part in the banks
portfolio of acceptances. as discounts
for member banks and holdings of
United States Government securities
showed little change for the period.
The decline in total volume of reserve
bank credit outstanding during the pc
r1od reflected growth of $10O 900 600
IN the stock of monetary gold, largely
through imports from Japan, and a
continued reduction in the reserve bal
ances of member banks, rejecting
further liquidation of member bank
credit.
Demand for currency declined dur
ing the last three weeks OF November,
and showed considerably less than the
usual seasonal increase in the first half
of December. After the middle of De-
cember, however, bank suspensions in
New England were followed by some
increased Withdrawals of currency, part
Of which has begun to return.
Loans and investments of member
banks In leading cities continued to
decline, and on December 9 were
S370,000000 smaller than four weeks
earlier. The decrease was equally di-
vided between the banks loans and
their investments. Deposits of these
banks, both demand and time, also
showed a decrease, with a consequent
reduction in required reserves.
Money rates in the open market
showed little change from the middle
of November to the middle Of Decem-
Der. Rates on prime commercial paper
continued at 3a to per cent, while
rates on 90day bankers acceptances
advanced from 27a to 3 per cent on
November Is, the report concludes.