Federal Reserve Bulletin, 1940-10

FEDERAL RESERVE BULLETIN OCTOBER 1940 Review of the Month—Business Conditions and the Defense Program From the Board9s Correspondence—The Rise in the Federal Reserve Index of Production Annual Report of the Bank for International Settlements Present Position of the Durable Goods Inventory BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM WASHINGTON Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Contents PAGE Review of the Month—Business Conditions and the Defense Program 1029-1039 Present Position of the Durable Goods Inventory, by George Terborgh 1040-1044 From a Legal Standpoint: Assignment of Claims Against Government 1045 Investment Company and Investment Advisers Act of 1940 1045 General Licenses Issued by the Secretary of the Treasury 1045-1060 From the Board's Correspondence: The Rise in the Federal Reserve Index of Production ... 1047-1049 Current Events 1049-1050 Bank Credit Available for Defense Needs ... 1050-1051 Revision in Bulletin Table on Treasury Operations... ... 1052-1054 The Financial Problem of Small Business .... 1055-1056 Foreign Banking Laws and Reports: Annual Report of the Bank for International Settlements 1057-1096 National Summary of Business Conditions 1097-1098 Financial, Industrial, Commercial Statistics, United States (See p. 1099 for list of tables.) 1099-1138 International Financial Statistics (See p. 1139 for list of tables.) 1139-1155 Federal Reserve Publications 1156 Board of Governors and Staff; Open Market Committee and Staff; Federal Advisory Council 1157 Senior Officers of Federal Reserve Banks; Managing Directors of Branches. . . 1158 Map of Federal Reserve Districts 1159 Subscription Price of Bulletin The FEDERAL RESERVE BULLETIN is issued monthly by the Board of Governors of the Federal Reserve System and is sent to member banks without charge. The subscription price in the United States, Canada, Mexico, and insular possessions is $2.00 per year or 20 cents per single copy; elsewhere, $2.60 per year or 25 cents per single copy. Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

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FEDERAL RESERVE BULLETIN VOL. 26 OCTOBER 1940 No. 10 (2ondition5 and the P to atam Current economic conditions are dominated of farm products held off the market by to a large extent by developments arising the Government are sufficient to reduce out of the war in Europe materially the free supplies. As increasing Effect on j especially by the amounts of industrial products are for armaan( more business situation . , ment, inventories accumulated have less mardefense preparations under- ket significance. taken here early this summer. The effects of Appraisal of the significance of changes in the defense program were widespread even production and consumption also presents before substantial Government orders were special problems of measurement. The placed. Producers and distributors, con- channels of distribution are different in many sidering possible increases in demands from instances and military equipment can not be their customers and possible restrictions on readily classified in the usual economic output of some products if capacity proved groups. Relationships between production, insufficient to meet both military and civilian on the one hand, and civilian consumption and requirements, ordered goods in larger capital formation, on the other, are being conamounts and sooner than they otherwise siderably altered. In a period like the present would, in order to assure ample supplies. prompt delivery of military supplies is re- In general, however, buying has been more garded as essential, but carrying out the exorderly than last autumn after the outbreak tensive program that has been adopted is necof war and reported price increases have been essarily a long-time process. On the basis more limited. of orders now being placed, production for Private and Federal purchases to date ap- defense would be expected to increase for pear to have provided a greatly increased a considerable period and this expansion backlog of orders in industries producing would be concentrated in certain industries. machinery and many other types of durable In some cases this will put great pressure on goods and also some nondurable goods, such existing capacity and expansion of plant and as textiles. Manufacturers' inventories have equipment will be required if domestic civilrisen somewhat and are close to the levels ian and export demands are to be supplied. reached late last winter after a period of con- For these reasons analysis of current developsiderable accumulation. The significance of ments requires special consideration of influthis level must be considered in the light of ences ordinarily not decisive but at present potential requirements, both for civilian and dominating the industrial picture. military use, and of conditions under which In August and September economic activity inventories would become available to the and national income rose further, continuing market. The stock piles of strategic materials the increase which began currently being accumulated by the Federal Recent business j i i . Industrial Government are being held on terms which developments ate ast spr c ng do not permit their appearance on commodity output, as the chart shows, markets for several years and the stocks is now above the level reached in 1937 and 1029 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Review of the Month is large orders from generally active domes- SELECTED BUSINESS SERIES ;ic steel-consuming industries. In the field IF DOLLARS 1 ' 1 DUAL BAS8rS0 )f construction, contracts for new projects r- _ - INCOME PAYMENTS ^**+-,—^* */ V^_ (AO JUSTED J _S^ were sharply higher in July and August, with ^-s ^ considerably larger volume of public awards 140 md some increase in private contracts. Ac- 120 I v NDUSTRIAL PRODUCTION / 120 ivity in other lines, such as railroad trans- \V )ortation, has also been expanding. 100 100 s/ Larger income payments arising out of the —^y 80 80 general expansion in activity have been reflected in increased purchases of goods by consumers at department stores and elsewhere. In certain instances, higher consumer incomes appear also to have contributed to increases in retail prices and in rents, but on the whole these have been small. Exports of United States merchandise to the United Kingdom and Canada increased further in August, and total exports rose to the level prevailing early this year before curtailment of shipments to the European jontinent. Owing to a greater demand for raw materials in this country, imports in July and August were the highest since last January. Sources: Income payments, exports and imports, Department In the commodity markets prices of basic of Commerce; industrial production, Board of Governors of the Federal Reserve System; common stock prices, Standard Statistics industrial materials have risen since the Company; basic commodity prices, Bureau of Labor Statistics index converted to 1926 base. Latest figures shown: income pay- middle of August, following a period of ments, exports, and imports are for the month of August; industrial production is estimated for September; stock and com decline. They are now back to the level of modity prices are for week ending September 28. last spring and substantially higher than in only slightly below the peak reached toward August 1939. Basic foodstuffs advanced in the end of last year. The Board's index for August but subsequently declined somewhat, September is now estimated at 124, as com- the principal change being in livestock prices. pared with 122 in August, 121 in June and In September livestock prices were at levels July, and a low of 111 in April. The high higher than last spring, while grains were point in 1939 was 126 in December. lower, under the influence partly of much In some of the industries most directly larger crops than had been expected earlier affected by war-time demands from abroad in the season. Prices of finished manufacand by military preparations in this country tures for the most part have shown little —the airplane, shipbuilding, engine, and change, although increases have been anmachine tool industries, for example—activ- nounced for some products, including most ity has increased almost without interruption new-model automobiles. since last autumn and is now considerably In the security markets prices of highgreater than at that time. At steel mill grade bonds have risen slightly in recent ingot production, already at a high level fo weeks and have been at about the record high three months, rose further in September t< levels prevailing before the sharp decline about 93 per cent of capacity in response t last spring. Common stock prices during heavy demands from Great Britain as we: most of September were at a level about 1030 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Review of the Month halfway between the low point in June and lower in July and August than in June. the level prevailing earlier in the year. Flota- These declines have been in contrast to contions of corporate issues for new capital have tinued expansion in textiles and certain other continued in small volume as funds required lines. for plant expansion and other purposes are The extent to which the rise in industrial still being obtained largely from other output since August 1939 has been consources. Commercial loans by city banks centrated in industries most directly affected increased moderately in August and Septem- by war developments and defense preparaber, following several months with little tions in indicated in the table below. Metal change. The Reconstruction Finance Cor- mining increased 32 per cent, and output of poration has made substantial commitments durable manufactures increased 28 per cent to finance purchases of supplies of strategic in contrast to a 5 per cent rise in nondurable materials by Governmental corporations and manufactures. As the table indicates, outalso to finance activities of private business put of lumber and products and stone, clay, concerns in connection with the defense pro- and glass products has risen less than output gram. of other durable goods more in demand for On the basis of a survey made by the Fed- military purposes. The decline shown for eral Reserve System for the National Defense automobiles reflects a temporary situation Advisory Commission the commercial banks not representative of the period as a whole. of the country have available and are willing The increase shown for fuels was from a low to lend large amounts for emergency defense level, as petroleum output was sharply curplant construction on the basis of a new form tailed in August 1939. The smallness of of contract developed by the Commission. This the rise shown for the nondurable group may is in addition to amounts that banks might be attributed in part to the fact that output lend for working capital needs, which may of these products was at a relatively higher also expand somewhat as a result of the defense program. A press statement giving the INDUSTRIAL PRODUCTION results of this survey is published on pages Index numbers, 1935-39 average = 100; adjusted for seasonal variation 1050-1051 of this BULLETIN. Output of industrial products advanced 1939 1940 ce P n e ta r- ge change further in August and September and cur- Aug. Dec. Aug. A A u u g g . . 1 1 9 9 3 4 9 0 rently is close to the peak last Industrial December, when the Board's in- Industrial production.. 126 122 + 17 production dex was at 126 per cent of the Durable manufactures 105 140 134 + 28 1935-39 average. The rise in actual out- I M ro a n c h a i n n d e r s y teel 1 1 0 1 4 1 1 12 6 5 7 1 1 5 3 8 8 + -f 4 3 2 3 Transportation equipment 92 128 104 + 13 put during the third quarter, however, was Automobiles _ 84 121 76 - 10 Aircraft... 177 239 382 +116 gradual in comparison with the sharp rise Shipbuilding. 133 144 211 4- 59 Railroad cars 74 136 123 + 66 in May and June when steel output in- Nonferrous metals and products. 112 159 144 + 29 Lumber and products 105 121 114 + 9 creased by nearly one-half and increases Stone, clay, and glass products... 113 128 117 + 4 in other lines were quite general. Since Nondurable manufactures. 108 118 113 + 5 Textiles and products 111 126 114 + 3 June steel output has risen further, but Leather and products 103 105 93 - 10 Manufactured food products.. 111 112 115 + 4 much less rapidly, being already at a high Alcoholic beverages 96 95 91 - 5 Tobacco products 110 109 106 - 4 level, and changes elsewhere have been fairly Paper and products 112 135 125 + 12 Printing and publishing 105 119 111 + 6 mixed. Automobile production, for example, Petroleum and coal products. 110 119 113 + 3 Chemicals 100 112 115 + 15 showed a marked decline of more than the Rubber products 112 123 110 - 2 usual seasonal proportions this summer as Minerals 91 114 116 4- 28 large stocks of 1940 models were being liqui- M Fu e e t l a s l . s . . . . 1 8 0 9 5 1 1 1 2 3 4 1 1 1 3 2 9 4 4 - - 3 2 2 6 dated. Output of paper products was also Note: Some figures for August 1940 are preliminary. OCTOBER 1940 1031 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Review of the Month level in August 1939 than was output of dur- Foreign trade figures for July and August able goods. But, in the main, demands re- reflect marked shifts in American exports sulting from war and the defense program, caused by war developments directly or indirectly, have been much less Foreign trade g .^ ^ ' gpring> With the important for nondurable goods. Paper is spread of the war and the extension of the an exception, reflecting the closing of foreign British blockade, exports to continental Eusources of supply. Production of chemicals rope fell from a monthly average of $107,000,is another exception, and these two groups 000 during the first quarter to $14,000,000 in accounted for a considerable part of such rise July, the first full month under the new conas there was in the nondurable group. ditions. In August virtually all that remained Comparison of production volumes at of our once large trade with this area was a the peak last December and this August can small volume of shipments to Sweden, Finalso be made from the table. The most strik- land, Portugal, Spain, and Russia. Exports ing fact is that, although the August level for to Asia have also declined rather sharply industry as a whole was still somewhat lower since the first quarter. than the December level, activity in the ma- Intensification of the war, on the other chinery, aircraft, shipbuilding, and metal hand, has greatly increased the British and mining industries was considerably higher. Canadian demand for many United States Increasing economic activity and higher products. Exports to these nations started income payments have been accompanied by to rise at the beginning of the war, and the an increase in retail trade, which increase became much more spectacular after Retail trade is now in substantially larger the period of heightened warfare began. In volume than a year ago. As is usual during August United States exports to the United periods of expanding incomes, the most Kingdom were more than double the monthly marked increase in sales has been in the fieldaverage for the first quarter of the year, alof durable goods. Automobile sales, while though cotton exports had been sharply retemporarily reduced at the end of the 1940duced, and shipments to Canada had inmodel season, in the first eight months of creased over 60 per cent; 55 per cent of total this year were about one-fourth larger United States exports went to these two than in the corresponding period of 1939. countries in August compared with 29 per Indicated sales of electric refrigerators and cent during the first quarter. Total July vacuum cleaners were at new high levels. exports were somewhat below the average The extent of increased demand for new established in the first quarter of the year houses is indicated in a later section of when shipments to all parts of the world this review. Dollar sales of general mer- were in large volume, but preliminary August chandise, including both durable and non- figures show a return to near the first quarter durable commodities of the sort sold through level, with the earlier geographical and comdepartment stores, variety stores, and mail- modity distribution drastically altered. order houses, were at a higher level in August Agricultural exports declined from a than at any time since 1930, when prices of monthly average of $80,000,000 during the these goods were well above current levels. first quarter to $26,000,000 in August. While At department stores, sales in the first three part of this decline represented a seasonal weeks of September continued close to the reduction, there was a decided worsening in advanced August level and were about 10 perthe position of agricultural exports. Due to cent larger than in September 1939. Stocks the blockade, exports of agricultural prodheld by department stores remained through ucts to the continent of Europe, which aver- August at the low level that has prevailed aged over $27,000,000 monthly during the since the middle of 1938. first quarter, fell to under $1,000,000. Agri- 1032 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Review of the Month cultural exports to the United Kingdom also CONSTRUCTION CONTRACTS AWARDED IN 37 EASTERN STATES declined sharply as more stringent controls [Monthly averages or totals in millions of dollars] on imports and domestic consumption were applied, and there was a reduction in cotton Privately-financed Pubshipments to Asia. Total liclyfi- Resi- Fac- All While exports of industrial products have nanced Total dential tories other been adversely affected by the loss of European markets, the increased demand of the 1 L 9 9 3 37 8 - - . 2 2 4 6 3 6 . 1 9 4 6 2 1 1 4 2 7 4 3 5 9 0 United Kingdom and Canada has much more L939-. 296 142 154 44 19399 than offset this decline. During August ex- 1st quarter 258 129 129 86 33 2nd quarter 309 141 168 105 47 ports of industrial products were higher 3rd quarter 312 146 165 98 51 4th quarter 305 153 152 91 44 than they had been in any month since 1930. The increase has been primarily in war mate- 19400 1st quarter 223 90 133 81 36 2nd quarter 318 121 197 123 54 rials ; others, such as automobiles and petro- July 399 205 194 116 56 leum products—formerly having large sales August.. 415 195 220 119 65 in continental markets—have declined. Fire- Source.~¥. W. Dodge Corporation. The figures shown are not adarms, ammunition, and explosives, which justed for seasonal variation. were shipped in volume for the first time in gram, modified recently to permit use of the war during late June and July and which slum-clearance funds to build housing for ocrepresented primarily sales of surplus stocks, cupancy, temporarily, by defense workers. declined in August. The recent high level of public residential The impact of the defense program on the building, shown on the chart, however, reconstruction industry is clearly indicated in a flected largely awards for barracks and for recent sharp increase in contracts regular slum-clearance projects. Legislation Building ded. Public contracts for conawar now pending would authorize the expendistruction work expanded greatly in July and ture of $150,000,000 by the Federal Works August, reflecting awards for a wide variety Administrator for defense housing. Private of facilities such as airports, shipyards and residential building has also increased, with barracks. Private awards as a whole incontracts for one- and two-family houses creased much less than public building, as is now at the highest level in more than a deshown in the table, but the rise in contracts for private factory construction was sub- RESIDENTIAL BUILDING stantial. Increased activity in the construc- CONTRACTS AWARDED IN 37 EASTERN STATES ADJUSTED FOR SEASONAL VARIATION tion industry generally has already been reflected to some extent in larger orders for materials. In the case of lumber, the increase in orders over a short period in August and early September was great and lum- V\J\J/ Ay ber prices were advanced sharply. Housing shortages have been reported in » PUBLIC. some areas, particularly near shipbuilding -Ml centers and arsenals, and vacancies generally continue low, especially in single-family dwellings. In certain areas where increased demand is concentrated rent increases are being reported. Public construction has been undertaken in some instances as a part of 1929 1930 1931 1932 1933 1934 1935 1936 1937 1938 1939 1940 the United States Housing Authority pro- Based on F. W. Dodge Corporation data. Latest figures are for August. 1033 OCTOBER 1940 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Review of the Month cade. Apartment construction continues at WHOLESALE PRICES a low level. 1926 AVERAGE FOR TOTAL * 100 Prices of basic commodities as a group have shown little change during the past three weeks, following a rise in Commodity prices ^ ^^ ^ Qf Augugt and the first week of September. Some industrial materials, however, have continued to increase and, as is shown in the accompanying chart, these commodities in the latter part of September were close to the levels reached earlier this year. Recent advances reflected an increase in buying which was partly seasonal in nature but was also an adjustment to the growing volume of consumption of these materials by manufacturers and to the rise in sales of finished products to consumers and the Federal Government. Prices of basic foodstuffs declined somewhat in September following an advance 1934 1935 1936 1937 1938 1939 1940 Monthly figures ; Bureau of Labor Statistics data, with Federal in August, which reflected chiefly advances in Reserve classification of livestock and products and other farm prices of livestock and meats. Increasing products and foods. September 1940 estimated. consumer incomes were an important factor other commodities as a group have shown in this rise and a seasonal decline in market- little change. ings was also a contributing influence. In retail markets price changes have been mixed. Food prices declined about 2 per WHOLESALE PRICES OF BASIC COMMODITIES cent from June to August, reflecting a sharp drop in prices of fruits and vegetables; earlier this year these prices had been at high levels owing to unfavorable weather conditions. Retail meat prices, which had been rising steadily since the early part of the year, continued at the advanced level during August. Retail prices of most other commodities have shown little change following small declines during the spring and early 1934 1935 1938 summer. Prices for the new-model auto- Federal Reserve groupings of Bureau of Labor Statistics data. mobiles, however, have been advanced. Latest figures shown are for Tuesday, September, 24, 1940. Agricultural commodities.—While whole- The general level of wholesale commodity sale prices of livestock and products have adprices, as measured by the Bureau of Labor vanced about 10 per cent since June, other Statistics index, was at 78 per cent of the farm products and foods, principally grains, 1926 average in the middle of September as cereal products, cocoa, and cotton have decompared with 77 a month earlier and 75 in clined. These declines were due partly to the August 1939. As shown in the accompany- seasonal pressure of marketings, prospective ing chart, practically all the fluctuations in- increases in supplies, and a further curtaildicated since April have been in prices of ment in foreign demand. farm products and foods, while prices of Production prospects for most major crops 1034 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Review of the Month increased during August and indications are Cotton prices in the third week of Septemthat including the generally large carry-overs ber were close to the loan value of 9Ys cents at the beginning of the season total domestic per pound, as compared with over 10*4 cents crop supplies for the 1940-41 season will be during most of the earlier part of the year. above the average of the last ten years. As During August exports were unusually small shown in the accompanying table, indicated and there was an increase of 1,340,000 bales supplies of leading crops are substantially in the prospects for the domestic crop. The above the volume available in the 1936-37 carryover at the beginning of August was season when a drought contributed to a con- about 10,600,000 bales, of which 8,700,000 siderable rise in prices. Supplies of most bales were in the Government loan stock. Dolivestock and livestock products are also ex- mestic consumption of cotton last season was pected to continue to be considerably larger 7,750,000 bales and exports totaled 6,190,000 than during that period. bales. With prospects for a sharply reduced volume of exports this season, indications DOMESTIC CROP SUPPLIES are that the loan stock may show an increase [In millions of units] of over 2,000,000 bales. In August domestic cotton consumption was 655,000 bales, com- 1940-41 1936-37 Crop pared with 631,000 a year earlier and in Sep- Pro- Carry- Total Total duction supply supply tember activity appears to have been maintained. Buying of cotton gray goods increased Cotton _ .bales 12.8 10.6 23.4 17.8 Wheat bu 783.6 284.0 1,067.6 768.7 sharply in the latter part of August, due Corn bu 2,297.2 603.0 2, 900. 2 1,686.6 Oats _ bu 1,206.9 146.9 1,353.8 1,063.9 partly to seasonal influences, and continued Hay tons _ 93.0 10.9 103.9 84.1 Potatoes, white bu 383.2 383.2 332.0 large in September, but total sales have still Tobacco. lbs 1,241.7 2,652. 7 3,894.4 3,349. 4 been below the volume sold during this period Source.—Department of Agriculture. Production as indicated Sep- last year. tember 1 and carry-over at beginning of crop year. Wheat prices at Kansas City in September Wool is an important exception in the averaged 75 cents per bushel as compared supply situation. Consumption of apparel with the loan value of 77 cents and a low of wool in the United States during the twelve 65 cents in the middle of August. The movemonths ending September 1 totaled 584,000,ment of wheat into the Federal loan stock has 000 pounds grease basis. If this rate were to been at a higher rate than last year and trade be sustained and stocks at the end of the wool estimates are that the total movement into season April 1 were to be as large as usual, the loan stock will range between 300,000,000 domestic supplies of apparel wool would need and 400,000,000 bushels as compared with to be supplemented by a large volume of im- 167,000,000 bushels reported last year. Total ports. From June to mid-September Federal domestic wheat supplies this year are excontracts for blankets and uniform cloths pected to be about 61,000,000 bushels larger have been awarded in a volume sufficient to than last year, reflecting both increased prorequire about 100 million pounds of wool, duction and a larger carry-over on July 1. which represents about two months of aver- The carry-over in this country has increased age domestic consumption. A large part of steadily in recent years from a low point of the effect of these orders has already been 83,000,000 bushels in July 1937 to 284,000, reflected in the 25 per cent higher rate of 000 bushels this year. At the same time apparel wool consumption in July and August there has been a large growth in supplies on as compared with the level earlier in the year. In recent weeks prices of raw wool and wool hand and available for export in other major tops, particularly domestic grades, have ad- producing countries. Exports of United vanced considerably. States wheat last season totaled only about 1035 OCTOBER 1940 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Review of the Month 45,000,000 bushels, although there were Fed- Generally prices of durable materials and eral subsidy payments ranging from 20 to those nondurable commodities for which de- 35 cents per bushel. mand has been affected by military require- Corn supplies have held at more usual ments have shown the largest increases in levels and, with most of the indicated carry- recent months. In most cases they are over for October 1 in the loan stock, prices still below the peaks reached in the latter are only slightly below the peak reached in part of 1939, following the period of heavy May of this year. They are close to last buying last autumn, but prices of zinc, lumseason's loan value of 67 cents at Chicago ber, and some other durable products are and about 45 per cent above the pre-war higher than at that time. level. Prices of other feed grains are not The effects of changes this year in foreign as high compared with recent years as are supplies and demand on domestic prices of corn prices. industrial products have been varied. With Higher costs of feedstuffs have been an the curtailment of the European market, important factor in the livestock situation shipments of lead into the United States during the past year. Indications are that from Mexico have been exceptionally large, the total pig crop this year will be smaller and domestic lead prices are currently conthan the large crop of last year by about 10 siderably lower than last winter, even slightly per cent. Marketings of hogs are likely to below the pre-war level. In contrast, refined continue rather large during the remainder zinc exports from this country have increased of 1940, according to the Department of Agrisharply this year due to the cutting off of culture, but are expected to decline substan- Belgian and other continental European suptially in 1941. Market supplies of cattle and plies from the rest of the world. Refining sheep are expected to continue fairly large. facilities have thus been under heavy pres- Reflecting chiefly the increased level of sure for the refining of foreign ore for export, prices this year cash farm income, including in addition to large demands for zinc from Government payments, is expected by the domestic consumers, and zinc prices have in- Department of Agriculture to be $8,900,000,creased sharply in recent months to a level 50 000, about 5 per cent higher than last year per cent higher than before the war. In the and exceeded since 1929 only by the income of case of cotton goods, Federal action has been $9,111,000,000 in 1937. Most of the increase taken to offset the effects of foreign developover last year is from livestock and products. ments. On August 26 the rates of Government Larger income is also expected from fruits payments on most cotton products exported and vegetables and from grains, while defrom the United States were raised to a level clines are likely for cotton and tobacco. Govabout %Y2 times as high as the rates in effect ernment payments in 1940 may be slightly since last December and about 85 per cent smaller than last year's total of $807,000,000. above the original rates effective during the Industrial commodities.—Prices of indussecond half of last year. trial commodities have generally shown little Domestic consumption of leading industrial change in recent months, except for some materials, including iron ore, steel scrap, coke, materials. Steel scrap, copper, lead, and non-ferrous metals, and lumber, have recently hides, which had decreased earlier this sumincreased in volume and currently are close to mer owing largely to the extension of the European blockade, have advanced since the the levels reached in the latter part of 1939 middle of August. Prices of some other and in the first part of 1937. Stocks held by materials, however, including cotton, silk, producers of materials generally are reduced rubber, and tin, in the latter part of Septem- from the higher levels reached earlier this ber were below their midsummer levels. year and in the case of some materials, like 1036 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Review of the Month coke, zinc, and rayon, they are quite small. pound. The Metals Reserve Company has However, supplies held at later stages in the also contracted to buy 770,000 tons of manform of raw and finished commodities are in ganese ore, or enough to supply our requiresomewhat larger volume partly to accommo- ments for about a year. These purchases call date the increased activity in many lines. in part for 25,000 to 65,000 tons of manganese The final disposition of commodities, as indiore annually in 1941,1942, and 1943 from an cated by retail sales and Federal purchases, American-owned Cuban company, and 80,000 appears to be showing a substantial rise. tons of domestic ore annually for the same Recent market developments have been inperiod from the Anaconda Copper Mining fluenced by the plans of Federal agencies for Company. Present domestic stocks of this the accumulation of substantial essential material for the steel industry als s*ock P^es °^ strategic commodiready amount to at least a year's supply. ties which may be impounded for The Reconstruction Finance Corporation several years except possibly in the event of announced on August 20 that it had allotted war. Four of the commodities being accumu- $50,000,000 for the purchase and storage of lated are basic industrial materials which are high-test aviation gasoline by another newlyimportant both for civilian and defense needs. created subsidiary, the Defense Supplies Cor- Altogether this program involves, according poration. These supplies would subsequently to available estimates, a total outlay over sevbe made available for sale to the Army and eral years of about $700,000,000. Navy as they were required. The Reconstruction Finance Corporation Under the provisions of the act of June 7, announced on August 19 that the Rubber Re- 1939 (Public No. 117) an appropriation of serve Company, a partially owned subsidiary, $100,000,000 was authorized to be expended had signed an agreement with the Internaby the Secretary of the Treasury under tional Rubber Regulation Committee for the the joint direction of the Secretary of War purchase in the open market of 180,000 tons and the Secretary of the Navy for the acof rubber during 1941. This supplements the agreement made late in June covering the quisition of strategic and critical materials purchase of 150,000 tons during the re- during the fiscal years 1939 to and including mainder of this year. Government rubber 1943. Appropriations to date for this purholdings will also include 85,000 tons cur- pose total $70,000,000. These materials are rently being received under last year's cotton- to be "used only upon the order of the Presirubber barter with Great Britain. Added to dent in time of war, or when he shall find that private stocks of 150,000 tons of rubber which a national emergency exists with respect to the Rubber Reserve Company has pledged national defense as the consequence of the to maintain, total domestic stocks of crude threat of war". The latest figures made availrubber, by the end of 1941, should equal able by the Treasury show that purchases of 565,000 tons, or about a year's supply. materials as of June 30, 1940, were in the Similarly, in the case of tin, the Recon- following amounts: struction Finance Corporation, through its Metals Reserve Company, has undertaken an agreement with the International Tin Com- Quantity Value mittee to buy in the open market 75,000 tons Chrome ore, tons 64,500 $2,106,250 of tin, or about a year's supply, by the middle Manganese ore, tons. 86,500 2,757,868 Manila fiber, bales.. 14,800 246,221 of 1941. Eventually the Company's total ex- Optical glass, lb 11,400 80,000 Quartz crystals, lb_. 11,800 100,000 penditures for tin are expected to total $150,- Quinine, oz 700,000 415,000 Tin, pig, tons 6,124 6,084,828 000,000. This sum would be sufficient to Tungsten ore, tons.. 449 500,944 accumulate 135,000 tons at 50 cents per Total $12,291, 111 OCTOBER 1940 1037 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Review of the Month Under the auspices of the National Defense The Administrator of the Federal Loan Commission negotiations are proceeding with Agency recently submitted to Congress information on commitments the British Government to store in this country stocks of Australian wool which are owned RFC commitments ma( j e by the Reconstruction tor defense loans ^ .. , by the British Government. On the basis of Finance Corporation durpresent negotiations 250 million pounds, ing the period June 25 to September 14, grease basis, would be stored in the United 1940, for loans and investments in connec- States as a strategic reserve. The financing tion with national defense. Of the total of of transportation and other charges would be $558,000,000 approved during this period, provided through the Reconstruction Finance $60,000,000 represents loans and stock pur- Corporation. Under existing regulations the chases which have been formally authorized use of foreign wool is prohibited in the pro- and the remainder represents in part conduction of fabrics for the Federal Govern- ditional agreements to make loans to private ment, but the statute would permit use of this business concerns and in part amounts allowool for military purposes in the event of an cated to Government corporations for loans extreme shortage of domestic wool. It is or for purchase of stock as funds are needed. understood that if negotiations are completed The table summarizes the commitments this foreign wool would be held as an "iron to show the amounts made available to special reserve" to be used only in the event of ex- corporations organized by the Reconstruction treme emergency. Finance Corporation in connection with the The rubber agreements provide that pur- defense program, and to private business chases will be made within a range of about concerns. 18 cents to 20 cents a pound and in the case of DEFENSE CREDITS APPROVED BY THE RFC1 tin it was announced that all tin available June 25,1940 to September 14,1940, inclusive will be purchased at a price of 50 cents a [In millions of dollars] pound. Prior to the rubber and tin agree- Amounts Conditional ments, declines in prices of these commodities formally agreements for: approved were indicated, due chiefly to the curtailment Total Stock of important European markets and the large Loans 2 S p t u o r c - k Loans c p h u as r e - s chases stocks held by American and English con- Government corporations sumers and in transit to them. organized by RFC: Rubber Reserve Co. 145 1 140 4 The press announcement accompanying the Metals Reserve Co 105 2 100 3 Defense Supplies Corp.. 58 1 53 4 agreement on tin stated that "tin acquired by Defense Plant Corp.... 30 1 25 4 the Metals Reserve Company will not be avail- Total 338 5 318 15 Business concerns 3 220 4 55 161 able to private industry until after January Total 3 558 55 5 479 15 1, 1944" and the agreement itself provides that tin may be released to private consumers 1 1 I U nc n l d u e d r e s se R c. F 5 C d, 's a s s h a a m re e n o d f e lo d a b n y s m ac a t d o e f j J o u in n t e l y 2 5 w , i 1 t 9 h 4 0 b . anks. only "in the event of a national emergency, * Includes $4,000,000 of conditional agreements later cancelled and not authorized as loans. * Includes $900,000 to business concerns under sec. 5d but not unaer which in the opinion of the Company, re- act of June 25, 1940. quires such a release". In the case of rubber, The above figures do not represent actual release of which is also restricted, except for cash disbursements. On August 31, the Rethe maintenance of normal trade stocks, until construction Finance Corporation had purafter the beginning of 1944, an interruption chased $2,000,000 of stock in Government in supplies through hostilities or some similar defense corporations and had outstanding occurrence is specifically indicated as the $55,000 of defense loans to private corporadefinition of an emergency. tions under the act of June 25, 1940. 1038 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Review of the Month About $340,000,000 has been made avail- the decline in June and have since made some able to the following Government corpora- further recovery. By the latter part of Septions: the Rubber Reserve Company, cre- tember industrial and public utility stocks ated to acquire reserve supplies of raw rub-had recovered about half of their May price ber; the Metal Reserve Company, created to declines and were near the lows of the spring acquire reserve supplies of strategic and of 1939. Prices of railroad stocks had recovcritical materials; the Defense Supplies Cor- ered about three-fourths of the May loss and poration, created to acquire reserve supplies were near the levels which prevailed in the of high-test aviation gasoline and such other summer of 1939. Trading in stocks on the materials as the National Defense Commis- New York Stock Exchange during July and sion may designate; and the Defense Plant August was the smallest for any two months' Corporation created to aid in plant construc- period since 1918. tion and in purchase of machinery and equip- The monthly volume of new securities sold ment for lease to private manufacturers. by corporations this year has been a little The commitments made to private com- larger on the average than durpanies for plant, machinery and working New security ing 1939. As in other recent issues capital for production of a variety of articles years, new financing has been related to national defense and for expansion largely for the purpose of refunding outof aviation and trade schools include $160,- standing obligations. Issues for new capital 000,000 of conditional agreements for loans, have increased, as compared with 1939, but, and $55,000,000 of loans formally authorized. as is shown in the table, the volume continues Corporate security markets have been small. Public offering of some issues was unusually inactive since June. Prices of postponed during May and June when market both stocks and bonds have conditions were especially unsettled by for- Corporate moved within a narrow eign developments. Several of these issues were offered in July, making the July total security markets volume of range and the of new corporate issues the largest for any trading has been small. month of 1940. Prices of high-grade corporate obligations, which had declined during May when the DOMESTIC SECURITY ISSUES security markets reacted sharply to the first [Monthly averages or monthly totals; in millions of dollars] news of more intensive warfare, recovered the greater part of the decline in June. Since Corporate Other i then these bonds, as represented by Moody's averages for Aaa issues, have been selling on Total fu R n e d - - New fu R n e d - - New ing capital ing capital a yield basis near 2% per cent. Yields have recently declined a little further and 1936-1937. 410 191 101 50 68 1938 366 106 73 66 121 near the end of September reached a new low 1939 475 144 32 144 155 level. In June and early July lower-grade 1940—Jan.-Mar... 326 151 37 52 Apr.-June. 274 126 51 56 corporate bonds also recovered the greater July._ 690 45 351 part of their May price decline and have since Aug 281 111 61 Sept. (est.) 190 50 40 moved gradually back to the levels of the early part of the year. i Includes issues of State and municipal governments and publiclyoffered issues of Federal credit agencies, but excludes direct obligations Prices of common stocks declined very of the United States Government. Source.—Commercial and Financial Chronicle. sharply during May, recovered only a part of OCTOBER 1940 1039 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Volition ofi the (food5 Unventotu by GEORGE TERBORGH Senior Economist Division of Research and Statistics I T is a commonplace of economic analysis sumption. These stocks may be regarded as that demand for durable goods is subject to a reservoir of unconsumed uses or services, wider cyclical fluctuations than demand for from which withdrawals can be made for a non-durable goods and services. While this time in excess of replacements. This makes it difference is attributable to a variety of fac- possible to postpone the production of durable tors, the most fundamental is the vastly goods for considerable periods without degreater size and importance of stocks in the priving the community of the services which case of durable goods. these goods supply. The effect of durability on the relation be- Effect of inventory on the relation of tween production and consumption may be consumption to production illustrated by the contrast between food and housing during the recent depression. Both Where production consists of the rendering are absolute necessities of life, yet it would be of intangible consumer services, such as those difficult to find two types of goods presenting of a physician, there is obviously no separa- greater differences in market behavior. The bility between production and consumption. production of food showed a remarkable sta- If the product is a physical commodity that bility, while the construction of housing all cannot be stored in finished form, fresh veg- but ceased. In the one case, because of the etables for example, the case is similar. With relatively insignificant magnitude of existing no stocks of consequence in the hands of con- stocks, the maintenance of consumption resuiners, disparities between the rate of pro- quired continuity of production on a comduction and the rate of consumption are lim- parable scale; in the other, the supply of ited to those occasioned by fluctuations in in- houses was sufficient to support consumption ventories in the hands of producers and dis- with relatively little shrinkage, so that for tributors. This is likely to be substantially some time production was virtually sustrue even if the finished product is storable, pended. The community simply continued to provided its consumption period is short, for make withdrawals from its enormous reserexample, canned vegetables. Because such voir of unconsumed housing services with goods are used up in a moment of time and dovery little current replenishment of the not need to be stored while undergoing con- supply. sumption, stocks in the hands of the ultimate users are ordinarily limited to small quanti- The durable goods inventory ties awaiting use, hense disparities between production and consumption rates attribu- Durable goods may be defined for the purtable to variations in these stocks are small pose of this discussion as those having a norand short-lived. mal useful life in excess of three years. The Where the element of durability enters, the term covers producers' plant and equipment case is radically different. Here it is necessary such as railroads, factories, and power plants; to hold large stocks of goods undergoing con-consumers' goods such as houses and passen- Note.—Views expressed in signed articles published in the BULLETIN are those of the writers and not necessarily those of the Board of Governors of the Federal Reserve System. 1040 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Present Position of the Durable Goods Inventory ger automobiles; and public property such in the decade 1920-30 is correct, the expanas highways and schools. sion in the following decade has probably been Embodying as it does the labor of decades, insignificant. We may be sure of the broad and in some instances of centuries, the stock picture as to the relative standing of the two of these goods in the hands of users is over- decades in the matter of inventory growth, whelmingly the most important inventory in but we cannot be sure of the absolute amount existence, comprising more than half of the of growth in either of them. national wealth as ordinarily reckoned, and Even if the estimate of inventory growth more than three-quarters of the man-made during the past decade were demonstrably wealth (wealth exclusive of land and natural correct this would not necessarily mean that resources). The magnitude of this inventory there are no more durable goods in existence in relation to its rate of consumption is than in 1930. It is quite possible for the invenequally impressive. While accurate estimates tory to expand extensively, in terms of the of the latter are unobtainable, it appears amount or number of units in use, while at the likely that the unused services in the inven- same time failing to expand intensively, in tory are the equivalent of 10-15 years' con- terms of its content of unconsumed services. sumption at the current rate. Contrast this A count of units in the durable inventories for with the inventory of goods undergoing pro- which data are available reveals in the maduction and distribution, which usually turns jority of cases an increase since 1930. There over in less than six months. If we measure are more houses, more automobiles, more the size of the two inventories relative to con- tractors, more miles of paved highway, more sumption, therefore, we must conclude that filling stations, more oil wells, more kilowatts the former is 20-30 times as large as the of electric generating capacity, more tons of latter. steel capacity, etc. While there are numerous exceptions to this trend, railroad locomotives and freight cars for example, it is probable Growth of the inventory that a proper weighting of the innumerable categories of goods composing the durable The available measures of the consumption inventory would indicate on balance a modof durable goods are so defective that esti- erate expansion extensively. Even on this mates of changes in the size of the inventory basis, however, the relative gain during the derived from the comparison of production past decade appears small compared with and consumption are no better than crude that of the preceding one (perhaps a quarter approximations. Nevertheless they enable or a third as much). us to get some idea of variations in the rate of growth of the inventory during different periods of time. Certainly a contrast as Change in age composition marked as we find between the estimates for Whatever may have been the growth of the the last two decades must be regarded as inventory since 1930 in terms of its content highly significant. They indicate a consistent of unconsumed services, it has been much less excess of production over consumption durrelatively than its extensive growth. This ing the period 1920-29, with a net expansion reflects a shift in its age composition during of about 40 per cent in the amount of unconthe decade. The period of heavy additions and sumed services in stock. During the decade 1930-39, on the other hand, there was a con- rapid growth before the depression resulted siderable period with an excess of consump- in a relative overweighting of the inventory tion, so that despite a favorable balance for with young units having a large content of several recent years the decade as a whole unused services. During the depression, shows an approximate offset, with little or there was a shift in the distribution toward no change in the amount of unused services.1 the upper age brackets, with a corresponding Since the figures for the actual amount or reduction in the average amount of uncondegree of change in the inventory are so un- sumed services per unit in use. certain, it is perhaps advisable to state the The decline during the past decade in the conclusion in a conditional form. We may say proportion of younger units may be illusthat if the estimate of a 40 per cent expansion trated by a few figures showing for certain classes of durable goods the approximate per- 1 The estimates indicate a growth in the inventory of publicly- centage of the existing stock under 10 years owned durable goods, balanced by an equivalent shrinkage in of age in 1930 and 1940. the privately-owned inventory. OCTOBER 1940 1041 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Present Position of the Durable Goods Inventory the effects of the depression will have been Approximate Percentage completely erased. of Existing Stock Under 10 Years of Age Consider where this assumption takes us. If the durable goods production of the coun- 1930 1940 try had increased since 1929 at its pre-depression growth rate it would have exceeded the Housing units (non-farm) 28 8 Railroad locomotives 20 6 production actually forthcoming in the in- Railroad freight cars 34 14 Electric generating capacity (privately owned) 65 25 terim by 125-150 billions of dollars. Even Metal-working machinery 52 30 if we allow for the fact that the consumption of durable goods may have been smaller by say 30 billions than it would have been on a The backlog concept projection of its pre-depression trend, we still have a supposed backlog of more than 100 It does not require the evidence of the billions to be "made up" in the future. If more or less uncertain estimates of changes we adhere to the logic of the procedure, this in the size of the durable goods inventory backlog can be made up only when and if in previously introduced to demonstrate that the future the durable goods inventory rises the past decade as a whole has been a period relative to the projection of its pre-depression of relative stagnation in the renewal and growth line. On this basis, it appears that it expansion of this inventory. It is sufficiently would now require a durable output 30-40 indicated by the fact that the value of new per cent above the present level merely to pregoods annually added to the stock has avervent the backlog computed in this way from aged during the decade only two-thirds as increasing further, while ten years from now much (after adjustment for price changes) we should need an output roughly double the as the average for the five years ending with present one for the same purpose! 1929, and barely over half as much as it would have averaged if pre-depression The mere mention of such requirements is growth rates had been maintained during enough to give one pause in assuming that the the interval. backlog is the difference between what has been and what presumably would have been There can be no doubt that this curtailin the complete absence of the depression. ment of production has left us with severe Even if we assume merely a partial absence deficiencies in the stock of durable goods in of the depression, however, we are on no use, both quantitative and qualitative, relamore solid ground. The backlog cannot be tive to potential requirements. These defithe difference between what has been and ciencies are often referred to as a "backlog," what might have been. There is an infinite the term implying, of course, that they are number of might-have-beens, each of which something to be "made up" in the future as yields a different result. an addition to the "normal" durable goods requirements currently accruing in the in- Granted that the backlog has no real existterval during which this catching-up process ence except in so far as it will in fact be occurs. "made up" in the future, it can only be the It is one thing to define the backlog, but difference between (1) what is going to be another to measure it. As to the possibility with things as they are, including the backof measurement, we may justifiably maintain log, and (2) what would be with things as an attitude of skepticism. In this connection they are, except for the backlog. In a few it may be of interest, even at the risk of instances where potential demand for a durdigressing, to comment on an assumption able good is closely related to an independent widely used in attempts to estimate the back- factor like population growth, it is possible log, namely, that it is the difference between to make a stab at estimating the present backwhat has been and what might have been. log (housing is a case in point), but such To take an extreme example, it has some- instances are few; for the most part the idea times been assumed that the durable goods of measurement is definitely out. Certainly production that would have occurred in the it is out as applied to the durable goods invenabsence of the depression but that in fact tory as a whole. did not occur is merely postponed in its en- That we cannot measure the magnitude of tirety until a later occasion, pending which present deficiencies in the inventory does it constitutes a "deferred demand," in other not lessen their importance. They affect words, a backlog. It is supposed that in time greatly the outlook for demand and produc- 1042 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Present Position of the Durable Goods Inventory tion in the durable goods field over the next competent opinion that it has been accelerfew years. It is worth while, therefore, to ated—but the rate at which technological consider the nature of these deficiencies more advance has been incorporated into the closely. durable inventory has been on the whole much slower as the result of the low level of additions during the depression. The gap The nature of inventory deficiencies between the average quality and condition of durable goods in use and the best that current The first thing to emphasize is the relative technology affords is therefore much wider nature of deficiencies. They do not exist in than before the depression. It constitutes an absolute sense, independent of economic under favorable conditions an exceptionally conditions, but only in relation to these condipotent incentive for modernization, both by tions. At the present time there are many the retirement and replacement of obsolete types of durable goods of which the existing units and by the renovation of other units stocks in use are large relative to current less definitely outmoded. The attainment of utilization, and which even have no effective a full-employment level of economic activity qualitative deficiency in these stocks, if by would almost certainly develop a strong tenthe latter we mean a deficiency that would be dency to "freshen up" the durable inventory eliminated under a continuation of present and to reduce the prevalence of obsolescence conditions. So-called "present" deficiencies toward the standards reached in previous are largely potential, and will become actual periods of prosperity. only if and when conditions improve. The extent to which they are effectively realized Quantitative deficiency.—We noted earlier will depend on the degree of this improve- that while the durable inventory appears on ment. Thus, if economic activity were to balance to have undergone a moderate expanclimb to the level made possible by a full sion extensively during the past decade, this employment of our labor force, "present" growth has been small relative to earlier deficiencies in the inventory would be real- periods. In the meantime there has been an ized, by the acid test of market demand for increase of 10-15 per cent in the number of new durable goods, in a volume vastly greater families and employable workers. than if activity were to continue at its current It is at least arguable that the present level. stock of consumers' durable goods provides Because of the stimulus of the defense pro- a smaller average per family—even apart gram and other factors, it seems likely that from unfavorable changes in the age comwe shall reach levels of economic activity in position of the stock—than before the dethe next few years much higher than those pression. Since there was in the Twenties recently attained. It is pertinent, therefore, a marked uptrend in the average holding of in appraising the adequacy of our durable such goods per family, owing largely to the goods inventory, to do so with reference to popularization of the automobile and of a these higher levels. It may even "be desirable large array of mechanical appliances for the to measure it against the requirements of household, we may justifiably anticipate that our full production potential, that is to say, under conditions of full prosperity in the the level of production we could attain with future there will appear a strong tendency a practically complete employment of our to raise the average stock above the present labor force. With this touchstone, let us level. To take a specific example, housing, look at the inventory from the standpoint of it is estimated that under such conditions its qualitative and quantitative adequacy. the present population of the United States Qualitative deficiency.—We have already would occupy 500,000 to 1,000,000 more pointed out that the curtailment of produc- dwelling units than it does currently. In tion during the depression has resulted in a another case, automobiles, there is little doubt shift in the age distribution of the durable that a return to work of most of the present goods inventory toward the upper end of the unemployed would increase substantially the scale. In a great many cases present stocks number of cars in use. The expectation is are badly overweighted with aged units, with similar for other components of the inventory a correlative underweighting of units re- of consumers' durable goods. The transition cently produced. The progress of invention to a full-employment level of economic activand improvement has apparently continued ity would materialize an exceptional demand unabated in recent years—indeed, there is for these goods to eliminate the present de- OCTOBER 1940 1043 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Present Position of the Durable Goods Inventory ficiency relative to the requirements of full armament prosperity than to prosperity of prosperity. the usual type. This suggests, at least, that In the field of producers' goods the broad the output of producers' capital goods will be picture is similar. The national labor force greater if a full-employment level of producis 10-15 per cent above 1929. Not since that tion is approached in conjunction with the year, however, has there been anything like defense program than if it were approached full employment, which means that there has under more normal conditions. Against this been no occasion to expand the capacity of suggestion we must offset the possibility that our productive facilities to an extent com- the demand for new facilities outside the imparable with the growth in the number of mediate orbit of the defense program may be workers available. Recent experience ap- smaller than otherwise because of doubts as pears to indicate that in large sectors of in- to the duration of a prosperity based on armadustry we now reach as full a utilization of ments, and the further possibility that demechanical capacity as prevailed in 1929, fense procurement may interfere to some or other prosperous years of the Twenties, degree with the delivery of capital goods to while we still have many millions of usable nonessential industries even when demand unemployed. It is demonstrable that in many is present. It is difficult to appraise the ulticases large additions to present plant capacity mate effect of these factors, but for the near would be absolutely necessary to meet a full- future at least it appears that the defense employment level of business. In other cases program will keep the output of producers' additions may be avoidable by the use of capital goods higher than it otherwise would high-cost capacity, by running an uncustom- be at like levels of general activity. As to the ary number of shifts, or by other means, but more remote future, we must suspend judgthis does not signify that they would in fact ment. be avoided if the higher level of activity were to materialize. It is more likely that facili- Conclusion ties would tend to expand in these lines toward a more customary and economical re- The present condition of the durable goods lation to the volume of operations. With inventory is one of serious deficiency relative producers' goods as with consumers' goods, to the standards and requirements of fully the transition to a full-employment level of prosperous conditions. This creates for the production would almost certainly material- durable goods industries what may be called a ize a heavy demand to make good quantita- strong technical position; which incidentally tive deficiencies now largely potential. is in marked contrast to the situation in 1929, At this point a word may be in order as to when some important classes of durable the bearing of the present defense program output (most notably housing construction) on deficiencies in the inventory of producers' were either declining or facing imminent decapital goods. The program involves a very clines regardless of the continuance of full considerable departure from the normal pat- or rising activity in the economy as a whole. tern of demand for industrial products. Nu- A strong technical position in durable merous items are required for which there goods does not in itself guarantee recovery is little or no present capacity. In many cases and prosperity. It is, however, a fundawhole new industries must be created, in mentally favorable factor of great impormany others the capacity of existing indus- tance. It augurs an early and vigorous reintries must be expanded beyond any normal forcement of recovery, however it may be requirements. There can be no doubt that initiated, and contributes greatly to the vitalour productive facilities as they now stand ity and duration of prosperity when it is are even more imperfectly adapted to an achieved. 1044 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

rtom a Jleg at Standpoint Administrative interpretations of banking laws, new regulations issued by the Board of Governors and other similar material of interest to bankers. Assignment of Claims Against Government "(a) the General Accounting Office, "(b) the contracting officer or the head of his The bill H. R. 10464, "To assist in the na- department or agency, tional defense program by amending sections "(c) the surety or sureties upon the bond or 3477 and 3737 of the Revised Statutes to per- bonds, if any, in connection with such contract, and "(d) the disbursing officer, if any, designated in mit the assignment of claims under public such contract to make payment. contracts", referred to elsewhere in this issue, Notwithstanding any law to the contrary governing received final approval of both Houses of the validity of assignments, any assignment pursuant Congress on October 3. It is expected that to the Assignment of Claims Act of 1940 shall constiit will go to the President for signature with- tute a valid assignment for all purposes." in a few days. Although the official print of Any contract entered into by the War Department the bill in its final form is not yet available, or the Navy Department may provide that payments the text as finally agreed upon by Congress is to an assignee of any claim arising under such contract shall not be subject to reduction or set-off, and as follows: if it is so provided in such contract, such payments AN ACT shall not be subject to reduction or set-off for any To assist in the national-defense program by amend- indebtedness of the assignor to the United States ing sections 3U77 and 3737 of the Revised Statutesarising independently of such contract. to permit the assignment of claims under public SEC. 2. This act may be cited as the "Assignment contracts. of Claims Act of 1940." Be it enacted by the Senate and House of Represent- Investment Company and Investment Advisers Acts of 1940 atives of the United States of America in Congress On August 22, 1940, the President apassembled, That sections 3477 and 3737 of the Revisedproved the Investment Company Act of 1940 Statutes be amended by adding at the end of each and the Investment Advisers Act of 1940 such section the following new paragraph: (Public No. 768, 76th Cong.). These acts "The provisions of the preceding paragraph shall not apply in any case in which the moneys due or to provide for the registration and regulation become due from the United States or from any by the Securities and Exchange Commission agency or department thereof, under a contract pro- of investment companies and investment adviding for payments aggregating $1,000 or more, are assigned to a bank, trust company, or other financing visers but specifically exclude banks, common institution, including any Federal lending agency: trust funds administered by banks, and bank Provided, holding company affiliates subject to super- "1. That in the case of any contract entered into vision by the Board of Governors of the Fedprior to the date of approval of the Assignment of Claims Act of 1940, no claim shall be assigned with- eral Reserve System. However, no regisout the consent of the head of the department or tered investment company may have a maagency concerned; jority of its directors consist of officers or "2. That in the case of any contract entered into directors of any one bank unless an affiliation after the date of approval of the Assignment of Claims Act of 1940, no claim shall be assigned if it of this kind existed on March 15, 1940. arises under a contract which forbids such assignment; General Licenses Issued by the Secretary of the Treasury "3. That unless otherwise expressly permitted by Since the publication of a General Ruling such contract any such assignment shall cover all amounts payable under such contract and not already and General Licenses on pages 936-938 of the paid, shall not be made to more than one party, and September 1940 Federal Reserve BULLETIN, shall not be subject to further assignment, except the following General Licenses have been isthat any such assignment may be made to one party as agent or trustee for two or more parties participat- sued by the Secretary of the Treasury under ing in such financing; authority of the Executive Order of April "4. That in the event of any such assignment, the 10,1940, as amended, and Regulations issued assignee thereof shall file written notice of the as- pursuant thereto relating to transactions in signment together with a true copy of the instrument foreign exchange, etc. of assignment with— OCTOBER 1940 1045 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

From a Legal Standpoint Treasury Department, Office of the Secretary, (1) Such remittances are made only by individ- August 28, 1940 uals who have continuously resided in the United States for one year or more immediately preceding Revocation of General License No. 2U Under Execu- the date hereof and who had been making similar tive Order No. 8389, April 10, 19%0, as Amended, remittances to the same payees for at least six and Regulations Issued Pursuant Thereto, Relating months prior to April 8, 1940; to Transactions in Foreign Exchange, Etc.* (2) Such remittances do not exceed $50 per General License No. 24 is hereby revoked. month to any payee except that additional sums not exceeding $10 per month may be paid for each D. W. BELL, additional member of the payee's family, provided Acting Secretary of the Treasury. that in no case shall a sum in excess of $100 per month be paid to any one family residing in any Treasury Department, Office of the Secretary, such foreign country; August 28, 1940 (3) Such remittances are made only for the nec- General License No. SI Under Executive Order No. essary living expenses of the payee and the payee's 8389, April 10, 19 UO, as Amended, and Regulations family; Issued Pursuant Thereto, Relating to Transactions (4) Such remittances are not made from funds in Foreign Exchange, Etc.* in which a national of any of the foreign countries A general license is hereby granted authorizing designated in Executive Order No. 8389, as banking institutions within the United States to de- amended, has any interest whatsoever, direct or tach coupons from securities of the type referred indirect. to in section 13A (1) of Executive Order No. 8389, as amended, when such securities have been in the Any bank effecting any such remittance shall satisfy custody or possession of such banking institutions itself that the foregoing terms and conditions are continuously since July 25, 1940; to present such complied with. coupons for collection; and to perform such other Banks are authorized to establish and maintain acts and to effect such other transactions as may be free dollar accounts if necessary, and only to the necessarily incident to such collection, notwithstand- extent necessary, to obtain the foreign exchange reing the fact that Treasury Department Form quired to effect such remittances. Foreign exchange TFEL-2 may not have been previously attached to acquired pursuant to this general license may not the securities from which such coupons are detached. be used for any other purpose. This general license shall not be deemed to author- Banks through which any such remittances origiize any transaction prohibited by reason of any pro- nate shall file promptly separate reports in triplicate vision (or ruling or regulation thereunder) of such on Form TFR-32 with the appropriate Federal Re- Order other than section 13 A (1). serve Bank. In addition, the bank ultimately trans- D. W. BELL, mitting abroad (by cable or otherwise) the payment Acting Secretary of the Treasury. instructions for any such remittances shall file weekly reports with the appropriate Federal Reserve Bank setting forth in detail (1) the amounts of foreign Treasury Department, Office of the Secretary, exchange acquired in cover of such remittances and August 30, 1940 the price paid therefor, (2) the sources from which General License No. 32 Under Executive Order No. such foreign exchange was acquired, (3) the amount 8389, April 10, 19U0, as Amended, and Regulationsof free dollar credits, if any, established or main- Issued Pursuant Thereto, Relating to Transactions tained as a result of the acquisition of any such in Foreign Exchange, Etc.* foreign exchange, and (4) the names and addresses of the institutions for whose account any such free A general license is hereby granted authorizing dollar credits have been established or maintained. remittances by individuals resident in the United As used in this general license the term "bank" States to their relatives or dependents within any of the foreign countries designated in Executive shall mean any bank or trust company incorporated Order No. 8389, as amended, through any bank, and under the laws of the United States or of any state, any such bank is authorized to effect such remit- territory or district of the United States, or any pritances, providing the following terms and conditions vate bank subject to supervision and examination are complied with: under the banking laws of any state, and also any other banking institution specifically authorized by •Sec. 5(b), 40 Stat. 415 and 966; Sec. 2, 45 Stat. 1; Public the Treasury Department to be treated as a "bank" Resolution No. 69, 76th Congress; 12 U. S. C. 95a; Ex. Order for the purpose of this general license. 6560, Jan. 15, 1934; Ex. Order 8389, April 10, 1940; Ex. Order 8405, May 10, 1940; Ex. Order 8446, June 17, 1940; Ex. Order 8484, July 15, 1940; Ex. Order 8493, July 25, 1940; Regulations, D. W. BELL, April 10, 1940, as amended May 10, 1940, June 17, 1940 and July 15, 1940. Acting Secretary of the Treasury. 1046 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Ttom the Soatd.5 6!oite5pondence *T*HE character and volume of inquiries addressed to the Board in recent years reflect the public's growing interest in problems related to money and banking. The inquiries cover a wide range of subjects repretenting many points of view, and it is believed that some of the Board's replies to the questions raised may be of interest to the readers of the BULLETIN. Selections for publication are made on the basis of frequency of inquiry, timeliness, and importance of subject matter. JQfoe In ike *Tedetal JQeietve Undax ofi Ptoductian SINCE the publication by the Board of its the depression, and this despite our huge unemnew index of industrial production there ployment and shrunken national income. has been a great deal of discussion of its "... This seems hard to reconcile with the characteristics in newspapers and other peri- fact that on a per capita basis our national odicals, and the Board has received a number income last year was only 82 per cent as large of inquiries from correspondents. The ma- as it was in 1926. Freight loadings per capita jority of commentators have approved of the were 58 per cent as large. Automobiles made were revision and have recognized that it has ac- 67 per cent as many. Bank checks drawn were 57 complished its purpose of providing a more per cent as much. All construction was 64 per comprehensive measure of present-day in- cent as great in value. Industrial employment dustrial production and one less subject to was 84 per cent as much. Department store abrupt fluctuations caused by changes in a sales were 75 per cent as great." few industries producing raw or semi-finished The criticisms of the index in this quotation goods. and elsewhere may be summarized under the Some commentators, however, have exfollowing three questions: pressed doubts of the validity of the index (1) Why does the new index show greater because the long-term growth which it shows growth in the past ten or fifteen years than appears to them to be out of line with other did the old index? measures of economic activity on which they (2) How can it be possible that industrial have been accustomed to rely. A statement production per capita is higher now than in in The Cleveland Trust Bulletin for September may serve as a good illustration of the the 1920's—when at that time we were prosnature of such criticisms. To quote from perous, and there was practically no unemthat Bulletin: ployment, while now we have not achieved full recovery and millions of people are out "According to the new index our industrial of work ? Is it possible that we now produce production has been much greater in recent more consumption goods per capita than we years than the old index led us to believe, and in did in the prosperous 1920's? part this change results from the inclusion of (3) Specifically, how can the rise in the figures representing the outputs of rapidly index of industrial production be reconciled growing industries that were not adequately with the decline in: (a) national income, (b) represented in the old index. Nevertheless the freight-car loadings, (c) building contracts, recent increases are so large that they challenge (d) department store sales, and (e) bank our credulity, for they seem to indicate that in checks drawn. recent years our volume of production per capita These questions, in substance, all aim in the of our population has been about as large as it same direction, but perhaps they can best be was in the years of booming prosperity before discussed one by one. OCTOBER 1940 1047 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

From the Board's Correspondence (1) The greater growth in the new than in physical output of manufacturing industries. the old index is partly explained by the fact And that is all the index professes to measure. that the new index includes data for many (2) The seeming paradox of the same per industries, which were not so important in capita output of industrial products along the past and were not included in the old with much more unemployment may be index, but which have increased rapidly in readily explained. In the first place output recent years.1 Among such industries are per person employed has increased, so that chemicals, rayon, alcoholic beverages, many the same or a smaller number of persons promanufactured foods, aircraft, and rubber duce more goods; at the same time the numproducts other than tires. Another impor- ber of available workers has increased more tant reason is that some of the figures for rapidly than the population as a whole. On industries covered by both indexes were re- the consumption side, the fact is that the unvised upward after detailed study; this was employed continue to live and, therefore, to particularly important in the case of paper, consume (either out of savings, or out of which had been carried in the old index for public or private assistance) while the emseveral years at much too low a level, pending ployed—owing to a rise in buying power, completion of revisions. salaries and wages being relatively higher A fair test of the representativeness of the than prices—consume more goods in the agindex of manufactures, comprising 85 per gregate than the same number consumed a cent of the total, is a comparison with the decade ago. most comprehensive data available at two- In relating industrial output to consumpyear intervals in the Census of Manufactures. tion, it should be recognized that the index of A new and reliable index based on these cen- industrial production does not attempt to sus data, recently compiled by Solomon Fab- measure the volume of economic activity as ricant of the National Bureau of Economic a whole—but merely the physical volume of Research, is compared in the chart with the output in manufacturing and mining. In cermanufactures component of the Federal Re- tain particulars the index, and census proserve index. The Federal Reserve index is duction data as well, may indicate a greater shown to indicate correctly changes in the growth than has occurred—thus, if more of food canning is done now at factories and less in the home, the increase in factory pro- PRODUCTION OF MANUFACTURES duction of food does not necessarily indicate BIENNIAL FIGURES, 1929*100 an increase in the food consumption. In the case of alcoholic beverages the increase in output shown is larger than actually occurred k because the volume of illicit production be- \ f /s fore the repeal of the prohibition laws was not measurable. At the same time there have N B A U TI R C E WJ A A U L \i / been innumerable actual gains in the output of goods, per capita as well as in total; wit- / f ness, for example, the growth of the chemical industry with its multitude of new products, 1 R F E E S D E ER R A V L E \ V \ v \ KA such as plastics, the increasing use of paper for a variety of purposes, and the further j \ expansion of printing and publishing. Actually, the growth in output of new products y may be understated in the index. (3) As to specific comparisons with other measures of economic activity, the comparison with national income fails to take into 1919 1921 1923 1925 1927 1929 1931 1933 1935 1937 1939 account, for one thing, the fact that income 1 These changes were discussed in the article describing the is measured in dollars, while industrial proconstruction of the new index published in the August BULLETIN. Changes in weighting the various series were discussed in an duction is measured in physical units. In article on "Measurement of Production", published in the Sep- 1939 national income was 12 per cent below tember BULLETIN ; the table on page 919 of that issue shows how the shift from 1923 to 1937 weights affected the relative impor- its average for 1925-29, while the index of tance of different series in the index and the text on pages 917 and 918 explains why the value data used offer the best basis the cost of living was 20 per cent lower. No available for determining weights in the market economy pre- accurate adjustment of national income figvailing in this country. 1048 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

From the Board's Correspondence ures for price changes is possible,1 but it is electric power industry, service trades, and clear that, when the lower level of prices is governmental activities represents a larger taken into consideration, there is nothing in- proportion of the total. Income from manuconsistent in a higher level of production with facturing and mining in recent years has a lower level of dollar income. been close to the same proportion of the total Check payments and department store sales as before. National income figures thus show have both been influenced by the lower levelthat the particular items selected for comof commodity prices. In addition, depart- parison, namely, building contracts, car loadment store sales are not typical of all retail ings, and bank checks, represent fields of trade, as other lines have decreased less, andactivity which have declined since the late 1920's in relation to manufacturing and mincheck payments have reflected the decline in ing, which are the activities covered by the security prices and the greatly reduced volindex of production. ume of speculative transactions in securities, In conclusion, no evidence has been prowhich surely are not a measure of the physiduced by the critics of the new production cal volume of output in manufacturing and index that undermines confidence in its validmining. ity within the field which it undertakes to The comparison with freight-car loadings measure, namely, the physical volume of outoverlooks the fact that goods are moved now put in manufacturing and mining industries. to a much larger extent than in the 1920's by The accuracy of the index depends primarily other means than railroad trains and that in upon the correctness and comprehensiveness addition the railroads now haul more goods of the underlying data for individual products per car. and industries. Practically all manufactur- In relation to the building industry it is ing and mining industries are covered diwell known that construction has continued rectly or indirectly. While the data used are, lower, relative to the 1920's, than most other on the whole, reasonably accurate, continuactivities. Production of building materials, ous work is being carried forward at the which reflects this lower level, is included in Board with a view to a gradual improvement the Board's index. of the underlying material. Cooperation in It is interesting to note, in this connection, this work and specific criticisms and suggesthat income from transportation, construc- tions in regard to data, methods, and techtion, and finance constitutes a smaller propor- niques used in the compilation of the index tion of the total national income now than a will be appreciated by the Board's staff and decade or more ago, while income from the will be given careful consideration. It is only by constant work and careful study that the 1 The relationship between national income and industrial pro- index can be improved and its representative duction and the difficulties involved in adjusting value figures for price changes are discussed in an article on "Measurement of character maintained. Production" published in the September BULLETIN. &uttent £ vent5 Resignations and Appointments on February 9, 1934. The vacancy thus created on the Cincinnati Branch board of The Federal Reserve Bank of Cleveland on directors was filled on the same date (Sep- September 12 accepted the resignation tember 12) when the Reserve Bank appointed tendered by W. H. Courtney, President of Buckner Woodf ord, Vice President and Cash- First National Bank and Trust Company, ier of Bourbon Agricultural Bank and Trust Lexington, Kentucky, as a director of the Company, Paris, Kentucky, a director of the Cincinnati Branch. Mr. Courtney had served Branch for the unexpired portion of the term in the latter capacity since his appointment ending December 31, 1941. OCTOBER 1940 1049 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Current Events The Federal Reserve Bank of Dallas on 27 and 28, and on September 27 the Federal September 14 announced the election of E. L. Open Market Committee met for the third Kurth, Vice President and General Manager time this year. of the Angelina County Lumber Company, The Federal Advisory Council held its Keltys, Texas, as a Class B director of the third meeting of the year on October 6, 7 Bank for the unexpired portion of the term and 8. ending December 31, 1941. The Federal Reserve Bank of Atlanta on Admissions of State Banks to Membership in the Federal September 13 accepted the resignation ten- Reserve System dered by Frank M. Moody, President of The The following State banks were admitted First National Bank of Tuskaloosa, Tusca- to membership in the Federal Reserve Sysloosa, Alabama, as a director of the Birming- tem during the period August 16, 1940 to ham Branch. Mr. Moody had served as a September 15, 1940, inclusive. director of the Branch since his appointment Colorado on April 13, 1934. On the same date that it accepted Mr. Moody's resignation, the Fed- Grand Junction—United States Bank of Grand Junction eral Reserve Bank of Atlanta appointed Gor- Illinois don D. Palmer, Executive Vice President of Hillsdale—Old Farmers & Merchants State Bank The First National Bank of Tuskaloosa, a director of the Birmingham Branch for the Indiana unexpired portion of the term ending De- Battle Ground—The Battle Ground State Bank cember 31, 1941. Greenfield—Greenfield Banking Company Nappanee—-State Bank of Nappanee Death of Branch Directors Louisiana John W. Neal, Chairman of The Second Arabi—St. Bernard Bank & Trust Co. National Bank of Houston, Texas, who had served as a director of the Houston Branch Missouri of the Federal Reserve Bank of Dallas since Lebanon—State Bank of Lebanon his appointment by the Reserve Bank for the term beginning January 1, 1938, died on New Jersey August 31, 1940. Bound Brook—Bound Brook Trust Company C. M. Bartholomew, Vice President of The Ohio Austin National Bank, Austin, Texas, who had served as a director of the San Antonio West Carrollton—The West Carrollton Bank Branch of the Federal Reserve Bank of Dallas Texas since his appointment by the Reserve Bank Bangs—First State Bank for the term beginning January 1, 1938, died Crosby—Crosby State Bank on September 25, 1940. Virginia Federal Reserve Meetings in Washington Blacksburg—Farmers & Merchants Bank of Blacksburg, Virginia A Conference of the Presidents of the Fed- Woodstock—Shenandoah County Bank and eral Reserve Banks was held on September Trust Company Sank Aedit -Qv*iUl>U jot tPefen** On September 25, 191+0, the National De-manufacturers for emergency defense plant fense Advisory Commission issued the fol- construction, according to a test survey conlowing statement regarding the availability ducted by the Federal Reserve System for the of bank credit for financing the defense pro- National Defense Advisory Commission. The gram, based upon a test survey made by the survey, covering a representative portion of Federal Reserve System for the Commission: banks in each of the country's twelve Federal Reserve districts, indicates that these institu- Commercial banks throughout the country tions have available and are willing to loan stand ready to loan at least $3,000,000,000 to an amount several times that which at pres- 1050 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Bank Credit Available for Defense Needs ent is believed required for building emer- these banks would stand ready to finance the gency production capacity. needs of the manufacturers, together with an Borrowings from the banks would be made indication of the rates at which such adby defense manufacturers in connection vances might be made. The banks were not with a new form of contract developed by asked to make firm or binding commitments, the National Defense Advisory Commission, but merely to indicate the availability of their after consultation with the War and Navy own funds at the present time and under pres- Departments and the Comptroller General. ent conditions, without reference to funds Legislation now pending in Congress to which might be obtained from correspondent permit the assignment of claims against the banks or Federal Reserve Banks on advances Government would allow manufacturers to or discounts. It is expected that returns from assign the contract as security for borrow- other banks which were not included in the ings needed for defense plant construction. initial survey will add substantially to the Because of the security thus afforded, interest total amount indicated as being available. rates should be lower than on the usual type Specifically, the new contract has two purof commercial loans. poses: To expedite signing of supplies con- Mr. William S. Knudsen, of the National tracts by the Army and Navy through assur- Defense Advisory Commission, commented on ing the contractor against loss on constructhe survey as follows: tion undertaken for military purposes; To safeguard the Government's interest in such "This forty-eight hour test mobilization of facilities on termination or completion of the bank credit available for defense plant construction loans shows that the commercial banks contract. of the country are eager to do their part in the The plan provides that the Government renational defense program. Not only are they imburse the contractor, not in additions to eager, but they stand ready with funds far in the unit price of the product purchased as excess of the amount needed for this purpose. As soon as the pending legislation has been heretofore, but in five equal annual installpassed which will allow the form of contract ments covering the amount of his capital exdeveloped by the National Defense Advisory pansion costs. Thus, cost of supplies and Commission to be assigned as security for such amortization of construction cost by the Govloans, I believe that manufacturers needing to ernment would be separated. Prices are expand their plants on account of the defense program should have no trouble in obtaining thereby held at a minimum and, while the funds for construction promptly and at low manufacturer is relieved of the risk involved rates of interest through their usual banking in building fixed assets for the emergency, connections. he still absorbs all the ordinary risks involved "We are grateful to the Board of Governors of the Federal Reserve System and to the Fed- in production. eral Reserve Banks and branches for their co- In other words, adoption of this plan asoperation in making this very timely and useful sures that neither the private manufacturer survey." nor the Government would assume in advance Federal Reserve authorities emphasized all the risk, nor subsequently reap as a profit that in the brief period (two days) during the residual value. The contract contains which the survey was made only a portion, provisions whereby the contractor may, by although a representative one, of the nation's purchase or lease from the Government, acbanks could be reached. The Board of Gov- quire use of the facilities for himself after ernors of the Federal Reserve System, work- they have served their purpose in connection ing in cooperation with representatives of the with emergency defense needs. National Defense Advisory Commission, de- It is expected that the plan will conserve scribed the plan by telegraphed messages to government funds and stimulate investment each of the twelve Federal Reserve Banks and of private capital in the defense construction their twenty-four branches. Each was asked program. At the same time, private manuto explain the plan to representative banks facturers would provide management and in its territory. In the interest of time the operation and assume all the ordinary risks survey was made over the past week-end in of the business. Government participation order to ascertain quickly the extent to which would be limited to actual expansion costs. OCTOBER 1940 1051 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

J2etri3ion in bulletin I able on Ttealutu Operation! IN the regular BULLETIN table on Treasury net deficit for budget and other accounts. Operations appearing on page 1122 of this The summary below represents an adjustissue several changes have been made in the ment of the bookkeeping records in order to classification of expenditures under general show the cash requirements of the Treasury, and special accounts, a new column has been i.e., the amounts expended from the working added for receipts, and the detail on trust balance or raised by sales of direct obligaaccounts, etc., has been expanded somewhat. tions to the public in excess of securities paid The occasion for these revisions was the off. In recent fiscal years the actual cash rechange on July 1, 1940, of the method of ap- quirements of the Treasury have been conpropriating funds to the Federal old-age and siderably below the bookkeeping requiresurvivors insurance trust fund and the dis- ments, largely because the investments of continuance by the Treasury of the former social security receipts in special debt issues classification of budget expenditures into appear in the Treasury statement as expen- "general" and "recovery and relief/' Fur- ditures although no cash outlays are involved. thermore, it is believed that the new grouping of budget expenditures may be of greater current interest. COMPARISON OF BOOKKEEPING AND CASH REQUIRE- MENTS, FISCAL YEARS, 1938-1940 Comparison with cash requirements [In millions of dollars] The figures shown in the table are a sum- 1938 1940 mary of data for the regular budget, trust, and other Treasury accounts published Bookkeeping requirements: largely on pages 2 and 3 of the daily state- General and special accounts, deficit 1,384 3,542 3,612 Trust accounts, etc., excess of receipts 306 890 137 ment of the United States Treasury; they do not indicate the actual cash requirements met Total __ 1,078 2,652 3,475 by open-market borrowing or through the Adjustment for net non-cash items (principally investments of social security and Treasury's working balance. Receipts, ex- certain other trust funds in special security penditures, and the deficit appearing under issues) ___ ___ 920 932 970 general and special accounts in the upper Cash requirements. _ 158 1,720 2,505 half of the table are shown as recorded for Change in working balance -429 +532 -997 the purpose of budget records. Included in Change in publicly-offered direct debt ___ -271 +2, 252 +1, 508 budget accounts are items which do not rep- In computing this change, the working balance for June 30, 1937 was resent immediate cash outlays, such as, for adjusted to include gold held in an inactive account by the Treasury. example, transfers to trust accounts on the basis of appropriations by Congress and in- Explanation of classifications shown in table terest paid on special Government obligations held in social security and other trust fund The groups of receipts and expenditures accounts. shown in the BULLETIN table can be readily- The column "trust accounts, etc.", details worked from the current end-of-month dailyfor which are shown in the lower half of the Treasury statements. The items, or combitable, also includes non-cash expenditures nation of items, from the daily Treasury items, such as investments of social security statement included in the classifications are receipts in special debt issues. These invest- described and illustrated below. Figures ments are reflected in the gross debt but do shown in the table for years prior to 1938 are not affect the general fund balance, the work- based upon the historical table published on ing balance, or the open-market debt. The pages 401-408 of the Annual Report of the last two columns at the top of the table show Secretary of the Treasury for 1938. Adjusthow the net bookkeeping deficits for budget ments made in some of these figures to take and trust accounts have been met. When account of recent bookkeeping changes made part of these requirements are met from a by the Treasury also are discussed below. reduction in the general fund balance the General and special accounts, receipts.— increase in debt is less than the bookkeeping The items from the Treasury statement inrequirements; when, in addition to require- cluded in the classification of receipts are ments, the general fund balance is increased illustrated for the month of August 1940 in the debt shows an increase in excess of the the following table: 1052 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Revision in Bulletin Table on Treasury Operations RECEIPTS, GENERAL AND SPECIAL ACCOUNTS ury statement included in the classifications [In millions of dollars] of expenditures for August 1940 follows: Items EXPENDITURES, GENERAL AND SPECIAL ACCOUNTS com- Totals bined shown [In millions of dollars] for in BUL- BUL- LETIN LETIN Items table table com- Totals bined shown for in Income taxes ___ _ __. 37.6 BUL- BUL- Miscellaneous internal revenue 346.2 LETIN LETIN Social security taxes: table table Employment taxes 123.8 Tax on employers of 8 or more.. _ 8.1 Taxes on carriers and their employees 7.1 Interest on debt 19.6 Railroad unemployment insurance contributions - 0.1 139.1 National defense: Navy Department 107.8 All other: War Department, military 91.5 Customs _ ___ 23.6 National defense fund for the President- 0.3 199.5 Miscellaneous receipts _ 19.8 43.4 Agricultural Adjustment program _ 76.4 Total receipts __ _.. 566.4 Unemployment relief: Deduct net appropriation to Federal old-age and Work Projects Administration 108.9 survivors insurance trust fund... _ 119.2 Civilian Conservation Corps 22.8 National Youth Administration 5.6 Net receipts ___ 447.2 Farm Security Administration, grants 4.5 141.8 Transfers to trust accounts: Railroad retirement account.— __. 26.0 The adjustment shown at the end of the Government employees retirement funds *0.8 25.2 above table reflects the change in method of All other: Departmental 74.1 making appropriations to the old-age insur- Post Office Department (deficiency) _ 10.0 ance trust fund as provided by the 1939 War Department, river and harbor work and flood control _- _- 22.7 amendments to the Social Security Act. Be- Social Security Board _ ___. 31.9 Public Buildings Administration 8.9 ginning with July 1, 1940, collections from Public Roads Administration 19.6 social security employment taxes less admin- Public Works Administration _ _. 14.8 Veterans Administration ; 45.9 istrative expenses are appropriated directly Revolving funds _ *13.0 All other 28.4 243.3 to the trust fund and are deducted from total receipts. Formerly appropriations to this ac- Total expenditures, excluding debt retirements. 705.8 count were voted by Congress each year and the transfers from these appropriations ap- * Excess of credits. peared under expenditures in the Treasury statements. In order to facilitate compari- National defense expenditures as published son of previously published figures of re- currently on the Treasury statement include ceipts for the fiscal years 1937-40 with those public works for national defense, some of for later periods, transfers to the old-age which formerly were shown under recovery insurance account have been deducted from and relief. Figures for back years have been total receipts. This adjustment is not en- adjusted to include these expenditures. The tirely satisfactory since old-age insurance tax Agricultural Adjustment program includes collections and the transfers to the account outlays for soil conservation and the earlier differed both as to amounts and timing. The benefit programs, parity payments, crop incolumn "net receipts" in the regular BULLE- surance, disposal of surplus commodities, TIN table represents total receipts after this and benefit payments under the Sugar Act adjustment. of 1937. Income tax receipts as now shown on the Unemployment relief expenditures are Treasury statement include the unjust enrich- shown as published currently in a table in the ment tax which formerly was listed as a sep- Treasury Bulletin. The items included in this arate item. Figures for back years were ad- classification are now available in the daily justed to include this tax. "All other" receipts Treasury statement. Prior to the current for the fiscal years 1934-1936 include, in ad- fiscal year, expenditures for the Farm Sedition to customs and miscellaneous receipts, curity Administration shown on the Treasprocessing taxes on farm products which ury statement included both grants and loans. were invalidated by a decision of the Supreme Expenditures for unemployment relief in Court in January 1936. earlier fiscal years included outlays under General and special accounts, expenditures.the Civil Works Administration, the Federal —A summary of the items from the Treas- Emergency Relief Administration, drought OCTOBER 1940 1053 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Revision in Bulletin Table on Treasury Operations relief expenditures in 1935, and advances to jof lending operations, and of most other States and municipalities by the Reconstruc- receipts and expenditures of these agencies. tion Finance Corporation for relief purposes "All other" trust account receipts include, in 1933. in addition to other trust accounts, the incre- Transfers to trust accounts in the fiscal ment resulting from reduction in the weight years 1933-1937 included transfers to the of the gold dollar and seigniorage on silver adjusted service certificate fund, which were purchases. The expenditures include those in large in the fiscal years 1936 and 1937 in other trust accounts, expenditures chargeable connection with the payment of the bonus. against increment on gold other than for re- As already mentioned, these expenditures do tirement of national bank notes, and expendinot represent immediate cash outlays. These tures of the Public Works Administration transfers, except for the adjusted service revolving fund. The table below shows for certificate fund, are included in trust account August 1940, the items included under "Trust receipts, and investments and benefit pay- Accounts, etc.," in the BULLETIN table: ments chargeable against them are shown under trust account expenditures. Because of TRUST ACCOUNTS, ETC. the recent change in appropriating funds to [In millions of dollars] the old-age insurance account, which has al- Items Excess ready been discussed, transfers to this ac- com- Totals of recount for the fiscal years 1937-1940 have bined shown ceipts for in shown been deducted from previously published BUL- BUL- in LETIN LETIN BULfigures for transfers to trust accounts and table table LETIN also from total expenditures. table Trust accounts, etc.—The net total of the Old-age insurance trust fund and railroad reitems included in this classification is shown tirement account: in the upper section of the BULLETIN table Rece O ip ld t - s a : ge insurance trust fund (net) 119.2 and the details are given in the lower part. Railroad retirement account 26.0 145.2 Net receipts of the old-age insurance trust Investments: Old-age insurance trust fund *5.0 fund and railroad retirement accounts in- Railroad retirement account 6.0 1.0 clude transfers to these accounts and inter- Benefit payments: est on the special debt issues which they hold. Old-age insurance trust fund 3.6 Railroad retirement account 9.9 13.5 130.7 As already mentioned, these items are re- Unemployment trust fund: flected in budget accounts in the column "net Receipts: receipts", in "interest on debt", and in "trans- Deposits by States 141.6 Deposits in railroad unemployment fers to trust accounts." As shown in the table, insurance account _ 1.1 the greater part of these net receipts have Other receipts. 142.7 been invested in special debt issues which do Investments 85.0 Other expenditures: not involve cash outlays. Benefit payments Withdrawals by States. 51.7 represent cash outlays. Be p n l e o f y it m e p n a t y i m ns e u n r t a s n , ce r a a i c lr c o o a u d n t unem- 0.9 52.6 5.1 Receipts of the unemployment trust fund Net expenditures in checking accounts of consist largely of deposits by States, deposits Government agencies: Reconstruction Finance Corporation 0.4 by the Railroad Retirement Board to the rail- Commodity Credit Corporation 2 *143. 6 United States Housing Authority.... *5.8 road unemployment insurance account, and All other: interest on investments. For this account Export-Import Bank *0.1 Federal Housing Administration 0.4 also, investments represent the issuance of Home Owners' Loan Corporation *24.2 Rural Electrification Administration. •0.7 special debt obligations to the fund and not Other *7.6 *32.2 181.2 cash expenditures, while "other expendi- All other: tures", which include withdrawals by States Receipts: Other trust accounts 15.1 and benefit payments from the railroad un- Increment from reduction in weight employment insurance account, are largely 8e o ig f n g io o r l a d g e d .. o _ l _ la _ r 0 2 ) .4 17.5 cash outlays. Expenditures: Net expenditures in checking accounts of Other trust accounts 15.0 P.W.A. revolving fund •0.4 Government agencies represent the net finan- Chargeable against increment on gold. 0) 14.6 2.9 cial transactions of agencies maintaining 319.8 checking accounts with the Treasury and include the effect of sales and redemptions » Less than $50,000. * Includes receipts from sales of $289,000,000 of guaranteed notes in the of guaranteed obligations in the open market, open market and expenditures of $146,000,000. * Excess of credits. 1054 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ike ^financial fttolrlem of} Small S |N September 9, 1940, Senator Joseph C. The following is a brief summary of the f O'Mahoney, Chairman of the Temporary report prepared and released by the Tempoational Economic Committee, released a rary National Economic Committee: statement describing and summarizing a study on "The Financial Problem of Small Formerly local wealthy individuals were almost Business" that had been prepared for the use the sole source of equity capital for local enterprise, of that Committee. The report of this study, but the report shows that today group efforts appear consisting of some 211 pages, is being sent to be replacing individual efforts in the supply of venture money. The growing practice by individuals to the Government Printing Office for immeof placing their savings with savings banks, life diate printing but printed copies will not be insurance companies, building and loan associations, available for so, le time. The report contains or the purchase of stock in the great corporations, the results of more than a year's study in has tended to syphon off money which would other- Washington and throughout the country by wise be used for investment in local enterprise. The the staff of the Securities and Exchange Comintegration of a considerable part of local business mission under instructions from the Tempointo national organizations, which themselves finance rary National Economic Committee. It is their various dealers has made considerably more divided into two parts—Part 1 consists of a difficult the financing of the remaining independent general analysis of the economic and financial local enterprises. aspects of small business and Part 2 consists Investment banking appears to have played virof statistical data, field studies, and certain tually no part in the financing of small business special studies dealing with some of the newer since the underwriting and marketing of securities— tynes of finance institutions which have been the traditional business of the investment bank—is specializing in the financing of small business. geared almost exclusively to the requirements of Two possibilities of meeting the difficulty large enterprise. The overwhelming preponderance experienced by small business men in seeking of small business is unincorporated, consequently venture capital are described in the report. only a small sector at best can avail itself of invest- The first is the suggestion that local banks, ment banking machinery. which under present conditions find it diffi- While the investment trust presents important cult if not impossible to make the sort of possibilities as a mechanism for providing equity loans small business needs, should be encourcapital to intermediate-sized business, it has seldom aged to do so by some legislation under which been used for that purpose. As now constituted loans of this character might be placed upon the investment trust offers little promise as a financan insured basis. This device would be de- ing medium to the small enterprise. signed to promote the extension of needed Traditionally, the commercial bank has been a credit which cannot now be secured because major source of credit to local enterprise. The local the assets which small business can offer are bank was completely integrated into the life of its not as marketable as necessary to justify the community; its management and ownership were in ordinary commercial bank in accepting them local hands; the business potentialities of its boras the basis for loans. rowers were known intimately. Frequently, the The second possibility, which is discussed directors and principal stockholders were also themfrom the point of view of providing a new selves financially interested in local ventures. But source of venture capital, is the establishment with the advent of the depression of the 30's and the of regional finance corporations under legisla- resulting credit strain upon the local banking systion which would enable the government to tem, the procedures for extending credits broke down. cooperate in the establishment of such insti- Much of the small business enterprise on which tutions by the purchase of preferred stock local commercial and individual activity depends is while allowing private capital to supply, not in a position to meet the existing lending standthrough the common stock, the real venture ards of commercial banks. Commercial banks which capital and to direct the management. ^ Ac-are under direct public supervision, do not act withcording to the statement of the Committee, out justification in restricting credit to small business. this proposal would, like the guarantee of The position adopted by the commercial banker, that loans, have the effect of providing govern- the funds at his disposal belong not to him but ment aid in a field which is not now served, to his depositors, and, therefore, can be loaned only to without imposing any degree of government individuals and enterprises whose assets and future control upon the private enterprise to be prospects make repayment certain, is fundamental fostered. to sound banking practice, the report states. Under OCTOBER 1940 1055 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

The Financial Problem of Small Business this responsibility, the business prospects of a con- merits further thought in considering the entire siderable proportion of the smaller enterprises at any problem of financing small business. If it is given time is not such as to warrant bank credit. deemed advisable for the commercial bank to further The heart of the credit problem has been and con- extend its aid to small business in this direction, tinues to be that large group of small businessmen it must be recognized that facilities will have to be whose enterprises are not so firmly established and provided to protect the banks against the non-liquid whose personal resources are not so great as to be and non-marketable character of the assets which able to satisfy the existing standards of commercial they will be required to hold, as well as against the banking. The report traces the experience of the added risks involved. Consideration should be given Federal Housing Administration, the Federal Re- to the advisability under suitable safeguards for the serve Banks and the Reconstruction Finance Corpora- Federal Reserve Banks or the Reconstruction Finance tion in endeavoring to fill up the void. It also deals Corporation assuming the role of guarantor on such with the newer financing agencies which have become loans. The basic principle for such an 'insurance' the bankers for small business—the accounts finance arrangement has already been embodied in a legiscompanies, the factors, the personal loan companies lative proposal." and the trade creditor. The report reviews certain of the measures which The report makes no specific recommendations. have already been proposed to Congress for the pro- But evidence indicates that of the existing financial vision of more adequate long-term and intermediate institutions, the investment trust or company appears credits for small business, such as Senator Mead's to be the instrumentality the form of which is most Bill which provides for the creation of an industrial suitable for providing equity capital to the incor- loan corporation, which would utilize the existing porated sector of small business. machinery of the Federal Reserve System. Reference With respect to the provision of long and short- is also made to other proposals to overcome the term credit, the report points out that credit is being deficiencies of the existing commercial bank system successfully extended to small business, witness the in supplying credits to small business such as the phenomenal and profitable growth of the "retailers" creation of a capital-credit banking system as a of credit—the accounts finance company, the factor, supplement to the existing banking structure. Comthe personal loan companies, etc. The successful menting on this proposal, the report states, "those experience of these lenders is due largely to their who have urged such proposals, believe that such a having developed such techniques and methods as banking system is required not only for small and "(a) pooling of risks; (b) routine procedures for intermediate size businesses but for business as a appraisal, accounting, and servicing; and (c) estab- whole since only through such banks can equity lishment of schedules of charges appropriate to each financing be provided." class of risk as well as to individual risks. In other The report also contains a discussion of the recent words, these 'retailers' of credit have been successful proposal by Chairman Jerome N. Frank of the Securiin financing small business because they have devised ties and Exchange Commission for the establishment 'mortality tables' expressly designed for the financing of a system of regional finance companies. In conof small business." clusion the report states that "it cannot, however, It is suggested that encouragement be given to the be emphasized too strongly that merely to reduce the organization of additional finance and factoring com- cost of credit or to make its supply more abundant panies "by encouraging the organization of addi- will not solve all of the small business man's probtional finance and factoring companies of moderate lems. Nor can we afford to overlook that, in addition size and a wider extension of the field of activity to adequate capital and credit facilities, small busiof the existing companies, coupled with some ma- ness also requires that its operating efficiency and chinery for the coordination of their functions and technical equipment be improved. Small business activities in such a way as to reduce costs and to must, in order to survive, match the operating and improve terms, the deficiency in credit facilities for developmental efficiencies which large business enjoys small business might in part be remedied. Considera- through its expert accounting, managerial, and opertion should also be given to the desirability of pro- ating techniques. viding insurance against losses sustained by such "Just as the credit and marketing problems of the intermediary institutions either by an agency of farmer have been dealt with successfully because government or by a corporation privately financed they have been delimited and special solutions develand expressly organized for that purpose." oped for particular needs, so, too, the capital and While recognizing that the making of "capital" credit problem of small business requires to be broken loans by commercial banks is open to serious question down into its component parts and special solutions the report states that "the practice nevertheless, found for its peculiar requirements." 1056 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

otelgn Hanking Jlawl and Kepott ofi the Hank faot Dnt at national The tenth annual report of the Bank for Despite all efforts to maintain output International Settlements, covering the year during 1914-18, world production declined ending March SI, 1940, was presented by markedly in those years, as may be seen from Mr. Thomas H. McKittrick, president of the the graph. The greater scarcity of goods Bank, at its annual general meeting at Basle produced together with the large requireon May 27, 1940. Selections from the re- ments for the pursuit of the war caused a port are given herewith: substantial reduction in the standard of living of the average citizen, obscured to some The war of 1914-18 interrupted a long extent by higher income in terms of money. upward movement in world production and trade that had gathered momentum from the WORLD TRADE AND BASIC PRODUCTION FROM 1850 middle of the nineteenth century when, in addition to technical improvements in production, transport on a large scale over land and by sea was made possible by rapidly expanding railway facilities and steamship services. The value and volume of international trade increased about five times between 1850 and 1914. The average annual increase of about 3 per cent in the world output of goods and services is borne out by more careful investigations of statistical material of the period up to 1914, including recent estimates of the long-term trend in national income. As during the same time world population increased at the rate of 0.8 to 1 per cent per annum, there was over the period a margin for a, steady improvement in the standard of living. In some countries real wages were trebled between 1850 and 1914. This improvement was built on the basis of the international gold standard, the relative freedom of trade and the intensification of international lending both at short and at long term. 1870 1880 1890 1900 1910 1920 1930 1940 SOURCES: Trade—Prof. E. Wagemann NOTE: The material republished above, with a minimum of Production—Carl Snyder textual changes, includes about one-third of the full report. Population—B. I. S. estimates The complete report is available in English. Sections omitted for reasons of space include the chapter on production and movements of gold together with the greater part of the discussion When the war was over the natural tendency dealing with the United States, under the heads of foreign ex- was to revert as far as possible to pre-war change, foreign trade, prices, capital movements, interest rates, etc., data on which are readily available in United States sources. conditions and reconstruction became the The chapter on current activities of the Bank is also omitted. In some cases the report extends to a period later than March, goal of economic and monetary policy. In a 1940. For earlier reports see BULLETIN for September 1939, and fair measure this objective was realized: June 1938, 1937, etc. OCTOBER 1940 1057 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports budgets were balanced; the international gold stands in sharp contrast to the more uniform standard was restored; foreign trade was tendencies in the 'twenties. largely freed from prohibitions and quanti- The United States, with about 40 per cent tative restrictions; and international lending of the world's industrial production, 40 per soon attained a considerable volume (al- cent of the consumption of industrial raw though under different forms and in new materials and 40 per cent of the world's nadirections). To all outward appearance the tional income, was harder hit by the 1930-33 basis was created for a further advance in depression than almost any other country prosperity. Indeed, the national income of and also experienced the greatest difficulties the world—even after making allowance for in restoring the balance necessary for a new an increase in commodity prices—soon sur- advance in prosperity. On the other hand, passed the 11)13 figures and the volume of there were countries which within a few world trade in 1929 was about 30 per cent years managed to increase their industrial above the pre-war level. production well above the previous record of 1929 through having attained at an early date an equilibrium in their domestic cost and World income and trade 1913 1929 1937 price structure and in their relation to other countries. In the United Kingdom the com- World income 1 In billions of cur- 100-110 205-215 200-210 rent dollars * bined effect of the depreciation of sterling Va a l n u d e i o m f p w o o r r ts ld exports In r b e i n l t l io d n o s l l o a f r s c 3 ur- 40.6 68.3 53.8 (whatever its consequences may have been in Volume of world ex- Index numbers: 100 130 126 other ways), of the balanced budget and of ports and imports 1913=100 the decrease in interest rates through the great conversion of War Loan in 1932 proi Estimate made at the B. I. S. * In 1913 and 1929 one ounce fine gold equivalent to $20.67 and in 1937 vided a firm basis for recovery; and the to $35.00. stability of exchange rates within the sterling area greatly assisted the recovery of foreign The progress which had thus been achieved trade of the countries concerned. State inwas impressive, but it was not to last. The tervention designed to stimulate business acdecline in the autumn of 1929 was probably tivity, to increase national production, and to at first merely an example of an ordinary absorb unemployment was the characteristic downward turn in the business cycle, but it policy of several governments, particularly released depressing forces which soon became in Germany and Italy. By the end of overwhelming and brought upon the world a 1936, after the devaluation of the gold bloc financial crisis and a series of monetary con- (France, Holland, Italy and Switzerland) vulsions such as had never before been known and the simultaneous conclusion of the Triin times of peace. Regarded historically the partite Agreement, a new equilibrium in the consequent setback in material progress was world's monetary conditions seemed within of crucial importance, and it is to be hoped reach and a rapid improvement in trade set that further attempts will be made to analyze in over a wide area, only to be interrupted the causes of the great depression of 1930-33. by the abrupt setback emanating from the In some respects this depression led to even United States in the autumn of 1937. Nevergreater disturbance in international financial theless the volume of world production had relations than the war of 1914-18 had done. made great progress from 1933, as may be The losses sustained by bankers and investors seen from the graph of basic production on on their foreign holdings were greater after page 1057. 1930 than after 1918. As a result the international credit system was largely put out of The increase in output was, however, only action—there has been an almost complete partly available for an improvement in the cessation of long-term foreign investment standard of living: a rapid rise in the outlay and a gradual liquidation of a great mass of for armaments absorbed particularly from short-term credits often at considerable loss. 1936 onwards an ever-increasing share of the Foreign trade has been hampered by a for- national income; but precisely because of the midable network of restrictions and the eco- greater volume of production the mounting nomic and financial policies pursued by the requirements could generally be met without various governments have conformed less and an actual reduction in the goods and services less to a coherent international pattern. The available for ordinary consumption. result has been a diversity of the economic Total world expenditure on armaments is development in different countries, which estimated to have been at the annual rate of 1058 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports some $20,000,000,000 in the first half of 1939. SWEDEN—FOREIGN TRADE To this must be added the unknown amounts [In millions of kronor] expended by the various governments on stocks of essential commodities. It is in many Year •Exports Imports Balance respects surprising that so much public spending, when current gold production was 1936 1,514 1,633 -119 1937 2,000 2,123 -123 at a record level and interest rates lower than 1938 1,843 2,082 -239 at any time since the 'nineties of the last century, did not bring about any appreciable rise Although a setback of domestic activity had in commodity prices. been anticipated, even the adverse effects Including the United States world indus- from abroad did not retard progress—and in trial production in the first half of 1939 had this connection it should be remembered that barely recovered to the 1929 level; excluding the increase in Swedish armament expendithe United States it was about 12 per cent ture was at a lower rate than in most other higher. In the United States the business countries. It would seem as if Sweden had curve receded slightly up to the summer of been able to maintain a proper balance in its 1939, but from then on an unmistakable in- cost and price structure, including the cost crease in activity was noticeable. American of wages and of capital, with the result that imports of raw materials, although some- investment in housing and other capital assets what higher than in 1938, remained in the remained at a high level. first half of 1939 well below the level of the Elsewhere in Europe, with few exceptions, 1936-37 boom, and this failure to stage a real armament expenditure increased at a prorecovery had its repercussions on the for- gressive rate. It is remarkable to note the tunes of primary producers, who were gradu- extent to which an intensification of armaally forced to intensify the curtailment of ment production in many countries proved their own purchases from industrial coun- compatible with higher private investments, tries. In this and other ways the recession on for instance in housing. the world markets reacted on the economies The outbreak of war came at a time when of individual countries in Europe, an interbusiness in most countries was on the upturn esting example being that of Sweden because with a rise in consumption, production and of the marked difference in the rate of doinvestment; and business sentiment—apart mestic and export activities in 1938. from the fear of war—was certainly tending The combination of expanding domestic towards a more hopeful mood. Psychologically industries and contracting export activity the fear of war had exerted a depressing inhad the effect one would expect, an increase fluence not so much on industry and trade in the import surplus, as shown by the second as on the stock exchanges, where quotations table following. in many countries tended to fall until August 1939. At the beginning of the war the attitude SWEDEN—INDEXES OP INDUSTRIAL PRODUCTION * of investors suddenly changed; there was, [1935=100] particularly in New York, an upward movement in share quotations during the first half Domestic industries Other of September, to be followed by a weakening Export (unclassi- All Year Con- Capital industries fied) industries as hopes of a war boom in the United States sumption goods industries based on large foreign orders gave way to a industries industries more cautious outlook. 1933 84 64 76 78 74 The transition from a peace to a war econ- 1 1 9 9 3 3 6 5 1 1 0 0 0 6 1 1 1 0 0 0 1 1 0 1 0 1 1 1 0 0 0 7 1 1 0 0 0 9 omy, which in 1914-15 had been gradual, was 1937 115 125 128 123 122 speeded up in the autumn of 1939 through the 1938 119 131 113 125 123 immediate introduction of far-reaching measures mostly prepared in advance. Thus it was * Annual figures of the Swedish Board of Trade. unnecessary to issue emergency decrees in- The Swedish development was notable in stituting general debt moratoria as had been that the upward trend of the country's econ- the case on the outbreak of war in 1914. But omy had gone on almost uninterruptedly in many countries exchange restrictions, as since 1933, i.e., for five years, when in 1938 well as extensive export and import prohithe recession came on the world markets. bitions, were at once put into force with im- OCTOBER 1940 1059 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports portant effects not only on foreign trade but mobilization expenditure of the four years also on the various domestic economies. 1914-18. Present engines of war are much The essential features of war economy so more costly than those in use in 1914-18; and, closely studied during and after the last war even if the industrial output behind the front and now again brought to the fore are simple has increased by perhaps 25 to 50 per cent enough. The fundamental problem arises through an advance in technical efficiency from the fact that the needs of the state in- and a greater degree of industrialization, the crease twofold or more at a time when the effort demanded to finance war and mobilizareal output of goods and services is reduced tion is on a formidable scale. In the various by the withdrawal of men through mobiliza- countries very much the same problems are tion and by the obstacles placed in the way being discussed: how is it possible to restrain of foreign trade. Some compensation can no private consumption in order to set resources doubt be achieved through more intensive free for the immense needs of the governwork by those behind the front, taking up un- ment? employed factors, enlisting more women in The present war started before the debts occupations outside the home, further utili- incurred in 1914-18 had been repaid, with zation of available men and machines, and the result that certain countries entered the through a postponement of the maintenance war with a heavy public indebtedness amountand replacement of assets not directly needed ing in some cases to a year's national income for war purposes. Moreover, foreign assets— or even more. Rates of taxation have been whether gold, foreign exchange or invest- raised to heights never known before, but ments—may be drawn upon to offset a decline few countries in Europe were, even so, able in exports and other deficiencies arising in to cover by taxation more than one-half of the balance of payments. As, however, no their total expenditure in the first half-year country wants to eat into its accumulated of war. The need for borrowing is great; and capital more than is indispensable, great capital which formerly went into private inefforts are made to maintain exports at the vestments is now required by the governhighest possible level. Production for export ments. This is of greatest importance for the purposes presupposes, however, in most cases building industry, which in some countries permission to obtain the necessary allocation has provided an outlet for as much as oneof workers and raw materials and thus be- half of the annual increment in the formacomes an element in the general war organi- tion of capital assets. In 1914-18 the activity zation, subject to the discretionary decisions of the building industry was reduced in Great of the authorities. In terms of real economy Britain by about 40 per cent and it is exthe problem consists in the most useful dis- pected that the reduction will be at least as posal of limited resources for one major goal, large in the present emergency. The stoppage the attainment of which necessarily involves of so much building to some extent cancels a reduction in the standard of living. From a the expansionist influence of the governfinancial point of view different methods are ment's deficit spending, most noticeable in its available to the government for obtaining effect on the armament industries. Financicommand of the necessary resources—higher ally, the diversion to the Treasuries of retaxation, borrowing of genuine savings, sources previously available for building mobilization of foreign resources, other presents few problems, but, economically, the forms of requisitioning and finally inflation. transfer of workers from the building trades, Anxiety to avoid inflation is, of course, uni- which usually allow relatively high rates of versal. remuneration, to other trades with generally In individual countries—including Euro- lower rates of pay is no easy matter. The case pean neutrals as well as belligerents—the vol- of the building trade is a good example of the ume of government expenditure rose rapidly interplay between financial and economic adfrom the autumn of 1939, creating pressing justments; it also illustrates the difference problems of financing the resulting deficits between the war economies in Europe and the by new taxation and by borrowing. In Swit- peace economy of the United States, as there zerland, for example, it is expected that the can be little doubt that the American business mobilization and national defense expendi- trend will depend in a large measure upon the ture from September 1939 to the end of June behavior of the building industry. 1940 will amount to 2,500,000,000 Swiss It is true, of course, that increased orders francs, or about the same sum as the total from Europe will affect the armament and 1060 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports some other industries in the United States, pected. The total of existing structures, such as the manufacturers of tools and ma- buildings and machinery more nearly meets chinery, and that a variety of goods will be requirements than formerly, it is said, and exported to a great number of countries, the pressure to expansion is, therefore, less. among which those of Latin America may Another view of the situation is obtained, assume special importance. But, even so, the however, if comparison be made with some economy of the United States with a national of the "older" countries of Europe where the income of over $70,000,000,000 can hardly "frontier" vanished long ago. In the United be dominated by the magnitude of the rise in Kingdom, Sweden and Switzerland—as reexports, total exports amounting to around ferred to above—one-half of the gross capi- $2,000,000,000 in the six months to February tal formation consists of housing while such 1940 as compared with $1,500,000,000 in the investments in the United States amount to corresponding six months of 1938-39. That barely one-quarter of the corresponding total the peak of the first upswing after the out- even at the low rate of total American investbreak of war was reached as early as Decem- ments in recent years. When current savber 1939 would seem to indicate that the in- ings are used less for developing the railroad, fluence of war orders is limited and that thepower and automobile industries or for con- American economy is still essentially a peace structing a network of motor roads, they may, economy. as in many European countries, be more The outlay for national defense by the largely used to provide improved dwellings. United States Government itself increased Great attention is being given in the United from $1,140,000,000 in 1938-39 to an esti- States to the possibilities of increased buildmated amount of $1,359,000,000 in 1939-40 ing activity, notably in the field of moderand $1,539,000,000 was originally proposed ately-priced houses for which costs of proin the budget for 1940-41 to which supple- duction and terms of financing are, of course, mentary credits of more than $1,000,000,000 of particular importance. In general the have been added—all these increases affect- upswing in the autumn of 1939 was characing very much the same industries as those terized by little increase in wage costs, in stimulated by European orders and thus that respect contrasting sharply with the liable to intensify a specific lack of balance tendencies during the short-lived boom of in the American economy. As a reduction in 1936-37. the current relief expenditure in the United One problem which necessarily arises in States budget for 1940-41 was planned, the connection with current discussions of the net amount of deficit spending should not be competition between relatively free econohigher on balance by the full increase in de- mies and those which are extending control fense expenditure. Experience has proved of production, prices, etc., is the extent to however that monetary measures such as the which the ordinary system of providing an depreciation of the dollar, cheap money and inducement to activity by a rise in prices deficit spending have not been sufficient by and wages can be replaced by a more direct themselves to achieve or even to support ef- organization of production. In 1914-18 the fectively a sustained recovery. Such measures familiar price mechanism was allowed to can be of lasting effect only in so far as they work, with its incentive to economic exertion (among other factors of an economic char- and its restrictive effects on consumption— acter) influence the continuing flow of pri- but the result was inflation. In practice vate funds into durable producers' goods and some compromise will very likely have to be into housing. found between reliance on direct control and The reduction in new capital formation provision of stimulus by higher remunerafrom the 'twenties to the 'thirties has been tion, but the compromise need not be the attributed in much recent discussion to same in different countries. As far as imgreater maturity of the American economy ported goods are concerned the "economic and the argument runs that, with the grow- price" will as a rule have to be paid, although ing measure in which natural resources have in several instances governments grant subbeen exploited (disappearance of the "fron- sidies (with or without rationing) to reduce tier") and with a reduced rate of increase in prices of imported commodities, to the immepopulation through the virtual stoppage of diate advantage of the consumers. immigration, a less rapid expansion of capital The system of direct control has also been assets by private initiative is only to be ex- applied on the money and capital markets. OCTOBER 1940 1061 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports The war of 1914-18 came after a long period which is mentioned in the recent Annual of growing demand for capital and rising Report of the Swiss National Bank. interest rates—and during the war rates con- The outbreak of hostilities has brought to tinued to rise. The present war has come an end business between countries at war after years of cheap money and, so far at with each other. Trading with the Enemy least, cheap money has generally been main- Acts and the various other measures for tained despite the war. The reservation of waging economic warfare as announced by current savings for the needs of the govern- the belligerent nations have curtailed or ment is largely effected by direct restriction stopped business in many other directions. of lending for other purposes instead of by The policy of the Bank for International higher rates and, at the same time, the ration- Settlements has been and is to confine its ing of commodities, which involves reduced activities strictly to transactions whereby no opportunities for spending, probably helps question can possibly arise of conferring to further the flow of private savings to the economic or financial advantages on any public coffers. At the end of April 1940 only belligerent nation. A letter setting out the four countries had increased their official principles which the Bank felt itself under discount rates above the level of the summer obligation to observe was directed to all of 1939—Sweden, the Netherlands, Norway clients in December and has received general and Denmark. (See page 1090.) In these four approval as giving expression to a policy of countries, as in most others, the note circula- scrupulous neutrality. tion had risen as a result of the demand for cash on the part of the public, to be held in EXCHANGE RATES, FOREIGN TRADE AND readiness for emergency. A more real demand PRICE MOVEMENTS for credit facilities—apart from the pressing Exchange rates.—In the foreign exchange needs of the government—has also made itmarkets as in other fields the increasing inself felt in connection with increased cash ternational tension and finally the outbreak payments for imported commodities, the holdof hostilities in September divide the year ing of reserve stocks and the financing of an 1939 into two distinct periods. The first extension of plant and equipment, especially seven and a half months were characterized in war industries. by a remarkable stability of exchange rates; Foreign trade is being more and more paid at no time since 1931 have the principal curfor on a cash basis. The cash principle of rencies of the world and the other currencies the United States "cash and carry" legisla- attached to them shown less fluctuation. The tion corresponds in fact to a general ten- few exceptions—as in China and Peru—did dency intensified by the widespread intro- not affect the general rule which was obduction of clearings and, of course, by the served despite vast movements of funds due general state of uncertainty. Gold as the in particular to the repatriation of capital to accepted medium for settling international France and the continued transfer of liquid balances has naturally acquired increased resources to the United States. In those importance, and this development in the countries not then subject to exchange conmethods of effecting international payments trol a high degree of international liquidity is to some extent reflected in the activity of in the face of adverse circumstances was the Bank for International Settlements. ensured by the intervention of central banks Normal credit relations naturally persist be- and exchange funds. But in August the strain tween countries politically connected as, for became too great and in the course of a instance, colonies and mother countries, as few days the whole aspect of the exchange well as between foreign subsidiaries and the markets was reversed. The support was withparent firms at home. Mention should also drawn from sterling and the rate depreciated be made of the credits granted on the basis of by 14 per cent against the dollar, followed special arrangements as, e. g., by the Export- by a number of the associated currencies. Import Bank of the United States, which is Exchange control was introduced in Septemable to lend on extended terms funds obtained ber 1939 both in the United Kingdom and from public sources. On a smaller scale the in France; and in the following months by Bank for International Settlements has con- other countries. By the end of March 1940 tinued to arrange for certain self-liquidating only four of the world's principal exchanges credits of a commercial character, through were free from official regulations—the dolthe intermediary of Central Banks, a service lar, belga, florin and Swiss franc. 1062 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports The stability of sterling, maintained from political tension increased after the middle of near the beginning of 1939 to the last week August, the demand for foreign exchange in August, was directly due to intervention made upon Exchange Account increased to by the Exchange Equalization Account: for amounts estimated at over £10,000,000 a day. the first time since 1931 the pound was On August 24 bank rate was raised from 2 to rigidly held—until the morning of August 25 4 per cent and the next day the Exchange the dollar rate was maintained at $4.68^4-^* Equalization Account withdrew from the But the pound was not free from pressure, market and allowed sterling to find its own being, in fact, exposed to the drain from an level. From $4.68 the dollar rate moved in adverse balance of payments (burdened by one day to $4.40 and reached $4.27 by the end additional imports for armaments), con- of the month. An official ban on foreign tinued depression in the raw-material-pro- security dealings was put into effect on Auducing areas of the sterling group, the move- gust 26. Following England's declaration of ment of central bank reserves from London, war on Sunday, September 3, foreign exrepatriation of capital to France and the change control was established on Monday, transfer of refugee funds to New York. One under the provisions of the Defence (Fiof the objectives in pegging the pound was to nance) Regulations. eliminate the encouragement to outside spec- The foreign exchange control limited dealulation given by a gradually depreciating cur- ings to authorized banks and bankers, set out rency. The authorities were aided in their the conditions under which foreign exchange policy by the ban on foreign security issues could be purchased, specified conditions for re-introduced in December 1938 and by meas- trading in gold and authorized the Bank of ures taken in January 1939 placing unofficial England to establish official rates for foreign restrictions on speculation in gold and for- currencies. Against the dollar the Bank eign exchange, particularly in the sphere of originally fixed a buying rate of $4.06 and a forward transactions. Further, the inter- selling rate of $4.02; in the middle of Sepnational assets of the Exchange Equalization tember the buying rate was changed to $4.04, Account were replenished by a transfer of and early in January 1940 the buying rate £350,000,000 gold (at the current price) from was increased to $4.03i/2 and the selling rate the Bank of England. lowered to $4.02^. On the free markets in Thus armed, the Account met demands for other countries rates for sterling were, howforeign currencies in the spot market and ever, quoted on the basis of the daily supply was reported to have operated in the forward and demand. The supply in these markets market for dollars in order to maintain the was derived from two sources: (i) balances discount on forward sterling as near as pos- in the United Kingdom, which non-resident sible to the difference in short-term interest holders were permitted to transfer freely to rates in London and New York. In the spring residents or other non-residents; practically the liquidation of maturing forward gold con- the whole of such balances dated from before tracts, which under the unofficial restrictions the war; (ji) balances arising from payments could not be renewed, helped to support the to non-residents in sterling for imports into pound to the extent to which gold positions the United Kingdom. The demand came from were not replaced by positions in other cur- non-residents who had sterling payments to rencies or new gold contracts in Amsterdam. make and who were not debarred by clearings In addition, the flow of short-term funds and other arrangements between their own turned against the dollar at the end of June countries and the United Kingdom from payand for the first few days of July, when the ments in "free" sterling. When exports U. S. Senate temporarily refused to extend from the United Kingdom are paid for with the duration of the American Stabilization sterling bought in the free market no for- Fund. Over the period as a whole, however, eign assets accrue to the British exchange the pressure against sterling was persistent. control. To reduce the consequent indirect The return flow of capital from the London drain steps have been taken to extend the market to France, which began in November area of clearing agreements and to limit 1938 and continued, after a slight interrup- the sale of British goods against sterling tion at the outbreak of war, until the end of acquired in free markets. By an amendment the year, was accentuated during periods of to the exchange regulations in March 1940 political crisis, and the same applied to the it was made compulsory for exporters from flight of refugee funds to New York. As the the controlled sterling area of certain com- OCTOBER 1940 1063 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports modities (whisky, furs, tin, rubber, jute and blocking foreign balances held in the British jute manufactures) to any of a number of market, while not permitting their transfer countries (Belgium, Holland and Switzer- at official rates. Foreign holders of sterling land, North and South America excluding balances have thus been entitled to leave the Canada, the Argentine and Uruguay) to in- market but only at an unfavorable exchange sist on being paid either in foreign currency rate. Comparison between the position of or in sterling bought at the official rate. London in 1914 and in 1939 shows that in Australia and Canada took similar measures, 1914 the foreign liquid assets of Great Britain applying however to all exports to non-ster- consisted of £38,000,000 gold in the Bank ling countries. of England, about £120,000,000 gold coins The free sterling markets have been char- in circulation and short-term sterling accepacterized by sizeable fluctuations, the rate tance claims on the rest of the world believed declining rapidly in March 1940 to around to have been at least equal to the short-term $3.50 in April and again falling abruptly in liabilities on foreign account. At the out- May. But these markets provide only a break of war in 1939 the combined gold resmall fraction of the total turnover of ster- serves of the Bank of England and the Exling, being estimated at 10 per cent towards change Equalization Account were broadly the end of 1939. As the accompanying chart estimated (in the Federal Reserve BULLEillustrates, the turnover of sterling in the TIN for December 1939) at about £500,000,- 000, i.e. substantially more than in 1914; moreover, the massive transfer of funds in SALES OF STERLING SPOT AND FORWARD TO U. S. BANKS 1938 and the first seven months of 1939 had AND OTHERS no doubt greatly reduced the total amount [ In millions of dollars ] of foreign volatile funds in London, but the 29Q 200 effect of this reduction on the net balance of London's foreign short-term assets and liabilities cannot, in the absence of more complete information, be indicated. In September 1939 practically all the gold held by the Bank of England was transferred to the Exchange Equalization Account and thus made directly available for use. Since short-term funds in New York continued to earn practically no interest during the past year, the forward discount on sterling (premium on the dollar) may be compared with a London interest rate. For this 1938 1939 purpose the bankers' three-month deposit United States (largely the New York mar- rate, which generally rules higher than the ket) , as indicated by sales made by banks and bill rate, would be more suitable, but a series bankers, declined from a level averaging of quotations is not available. The discremore than $100,000,000 weekly in the first pancy between forward and interest rates eight months of 1939 to roughly $60,000,000 went from under y% per cent in March to weekly after the introduction of restrictions. nearly one per cent in April 1939 when the Sales from one bank to another were par- pound was under accentuated pressure, deticularly affected, while sales to non-banking spite reported forward operations by the customers, who for the most part represent British control. In London, permitted transthe ultimate users of the exchange, even actions were put through at a fixed charge; increased during the period of sterling de- in New York, speculative anticipations domipreciation at the end of August and during nated the narrow free market, and the disthe decline in the free rate in mid-September. count during the November weakness of the The figures include, however, not only sales spot free rate produced a much wider reacat free rates but also sales made to customers tion in the forward market than the greater by American banks where official exchange decline of March 1940. had to be obtained. As long as the sterling-dollar rate was Through the working of the free market kept stable by the intervention of the Exthe London control has been able to avoid change Equalization Account the various 1064 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports currencies in the sterling area remained (i) The link with sterling was maintained stable also in terms of gold. There was con- by the Empire adherents of the sterling area, sequently a fixed relationship between the and also by France, Egypt and Greece. In sterling area currencies, linked in a fixed the Empire, including all Dominions, Crown ratio to the pound because of ties of Empire, colonies, dependencies, mandated states and PERCENTAGE CHANGES IN VALUE OF STERLING-AREA CURRENCIES New York rate against $ London rate against £ in $ per unit Country Units of currency Per- Perper £ unless Aug. 24, Dec. 30, centage Aug. 24, Dec. 30, centage otherwise indicated 1939 1939 change 1939 change British Empire: Australia 100 A. £ 125.0.0 125.0.0 3. 74H -15.5 British India >er Ruiipee.. 17i5/ied. 18 d. + 0.3 0. 3502 0.3020 -13.8 Eire 100 £.. 100. 0. 0 100.0.0 4.68H 3.95% -15.5 New Zealand 100 N. Z. £.. 124. 7. 6 124.7.6 3.77M 3.19 -15.4 Straits Settlements per S. S. $„_ 283/,« d. +0.2 0. 5497 0.4656 -15.3 Union of South Africa 100 S. A. £.. 100. 5.0 100. 5. 0 4.67^ 3.94% -15.6 Non-sterling area: Canada (and Newfoundland). Can. $ „ 4. 45 i + 5.3 0. 995/is 0.88% -10.6 Hong Kong per H. K. $.. I 15 d. + 2.6 0. 2847 0. 2472 -13.2 Other sterling area: E Fr g a y n p c t e F 10 r 0 . f E r . a n £ c . . . 9 17 7 6 H 23/32 9 17 7 6 H ^ + 0.1 0 4 . . 0 8 2 0 6 H 415/ie 0 4 . . 0 0 2 5 2 ^ 4% - - 1 1 5 5 . . 2 5 Denmark D. Kr.. 22.40 20.38 + 9.9 0. 2090 0.1933 - 7.5 Norway.._ N. Kr.. 19.90 17. 70 i +12.4 0. 2351H 0. 2273 - 3.3 Sweden S. Kr.. 19.40 16. 90 i +14.8 0. 2413^ 0. 2383 - 1.3 Finland Markka.. 226^ 210 + 7.9 0.02065 0.02 - 3.1 Turk J E L Y A U B P G a e o s a o u r r r p y t e u t r g l g o a v t e i g e o v u n n c i n u s a i g e i a l a t a a a i y l n vi a a ... p f E L T E D D p c r . o e e e . s a i r r r n e c n a t K £ . t u Y f a c . r P . r d r h o r e e e o . l m e n s . l . e o . a P d . e . B so oliviano.. 2 1 5 2 1 5 2 1 7 4 4 0 1 0 4 . % 8 0 M 5 0 A 3 3 d / . ie 2 5 5 2 1 1 1 1 0 7 2 3 4 4 0 . . 1 0 i 3 5 8 5 0 7 d M 2 / 5 . i 6 i + + + + + + + + + - 1 1 1 1 1 8 2 0 7 4 0 2 2 2 0 . . . . . . . . . . 9 7 1 1 3 0 9 2 5 7 0 0 0 0 0 0 0 0 0 0 . . . . . . . . . . 0 1 0 2 8 0 3 0 2 4 8 0 2 5 0 3 7 3 2 7 2 9 7 8 2 2 7 5 3 3 8 1 4 5 9 9 5 1 0 1 K 0 0 0 0 0 0 0 0 0 0 . . . . . . . . . . 1 0 0 0 2 7 2 3 0 2 9 3 0 2 3 3 7 7 2 2 7 7 7 3 8 4 6 5 3 7 0 6 3 0 1 9 0 0 5 5 + + - - - - - - - - 1 1 1 1 5 3 4 6 2 1 0 3 3 7 . . . . . . . . . . 0 6 0 1 1 7 4 7 2 5 1423 A 6 i Official rates (middle). 2 Trade payment rate. NOTE.—An attempt has been made to find comparable quotations for the various currencies associated with the sterling area but, while it has been possible to do so within a single market for the two dates indicated, quotations for an individual currency as between New York and London on the same date are not always comparable. Rates in terms of sterling are London quotations. Except for the currencies of the sterling-area Dominions, middle rates have been chosen whenever possible; where a nominal sellers' rate only was available for one date, sellers' rates have been taken throughout. In the case of the Argentine peso, the free rate on August 24 has been compared with the official London rate of December 30. Dollar quotations are New York closing cable rates, where such were available. The Estonian crown rate is derived from dollar quotations of the Estonian National Bank; in the case of the Egyptian and Turkish pounds and the lat, rates were computed from London cross rates. Owing to incomparability of London and New York rates, the percentage appreciation in London and depreciation in New York for certain currencies are not always consistent with the depreciation of the pound over the indicated period either in New York (15.5 per cent) or in London (14 per cent). trade or finance, and the gold currencies protectorates (with the exception of Canada, headed by the dollar. When sterling depre- Newfoundland and Hong Kong), a currency ciated in August 1939 the currencies of the free inside the area was in fact created, sterling area did not all follow the same surrounded by foreign exchange restrictions. course; in some instances their sterling rate In Egypt foreign exchange restrictions simiwas kept unchanged; in others allegiance lar to those in the United Kingdom were was shifted to the dollar; and there were put into effect. Moreover the monetary other changes. An attempt is made in the agreement with France provided for a fixed table on the preceding page to set out as rate between the pound and the franc. clearly as possible the diversity of move- (ii) Canada, Newfoundland and Hong ments in relation to the exchange value of Kong, which though belonging to the British sterling and the dollar; it is necessary to Empire have not been members of the sterunderline, however, that owing to the quota- ling area because of their close trading and tion of different rates for sterling in the financial relations with other countries, alofficial and free markets and also the quota- lowed appreciations of their currencies tion of multiple rates for some other curren- against sterling by 5.3 per cent in the case cies the situation is one of great complexity. of the first two, and 2.6 per cent for the last- The developments may be summarized as named. In the free market in New York the follows: Canadian and Hong Kong dollars fluctuated OCTOBER 1940 1065 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports with the pound sterling, but within a nar- countries by complete exchange control in rower range of depreciation. Canada and the course of the winter. It may be men- Newfoundland established a complete system tioned that by special provisions the Bank of foreign exchange regulations, and certain for International Settlements was exempted restrictions were also introduced in Hong from the Swedish restrictions on gold and Kong. exchange transactions. (iii) Japan permitted the yen to follow (vi) Turkey permitted some depreciation the depreciation of sterling in the London of the Turkish pound against the dollar, but market, but after some hesitation in Sep- the Yugoslavian currency link to sterling was tember established a link to the dollar of broken at the end of August in favor of a $0.23% 6 in order that the currency should dollar rate of Dinars 55. not fluctuate against gold currencies with (vii) Uruguay, after breaking with sterthe free pound. ling in mid-September, more than restored (iv) Portugal similarly permitted the the dollar value of her currency, while the escudo at first to follow the pound sterling Argentine, also shifting the peso to a dollar in the official market, but formed a link with basis, permitted a slight depreciation against the dollar at Esc. 27.50 during the November the latter currency, amounting, in the case weakness of the free pound in the New York of officially determined rates, to 2.7 per cent. market. Thus the Argentine has maintained (from (v) Among the Scandinavian and Baltic September 22, 1939) four different rates: an countries diverse movements occurred. The official buying rate at 3.36 pesos per dollar, Swedish crown remained practically stable an official selling rate of 3.73 for goods essenin terms of the dollar, being depreciated by tial as regards popular consumption and inonly 1.3 per cent, while the Norwegian and dustrial activity; another official selling rate Finnish currencies were lowered by about of 4.23 pesos for certain other goods and 3 per cent and the Danish and Estonian by services; and a free market rate of 4.39 pesos 714 per cent. In September the Estonian (quotation in December 1939). Correspondand Latvian currencies were linked to the ing sterling rates were calculated on the basis Swedish crown. In all these countries fixed of the official London rate of $4.02 to the dollar rates were quoted, and as regards pound. In Bolivia the sterling peg was aban- Sweden and Norway fixed rates were also doned in favor of the dollar at the lowest quoted for "special pounds" after the intro- point of the November decline of free sterduction of clearing arrangements with the ling in New York, with the result that at United Kingdom. In Denmark a fixed ster- the end of the year, after free sterling had recovered, the controlled rate had depreciated in terms of both currencies. QUOTATIONS OF SWEDISH CROWN IN NEW YORK AND IN LONDON From May 1938 to the outbreak of the war the French franc was maintained within a narrow range in terms of sterling, but the Dolar French authorities permitted certain fluctua- 1 tions, particularly when the pound was under pressure in times of political crises. In contrast to London there have for several years LSI >rling been virtually no foreign funds held in the V Paris market; and the French people have repatriated substantial amounts from abroad, especially in periods of political tension when ling rate was quoted by the exchange con- the pound was weak because of a flow of trol although no trade agreement was con- funds from London. During December 1938 cluded with the United Kingdom. In Finland the exchange value of the franc improved the outbreak of hostilities created a special from 178.90 to 176.83 and thereafter flucposition. The Finnish mark depreciated tuated for the most part between 176 and from approximately 50 to the dollar to 57 in 177 until the depreciation of the pound, beearly January and to 62 in February. Fin- ginning August 25, 1939, when the franc land and Sweden applied certain limited and reached its highest value in terms of sterling unofficial exchange restrictions from the out- at 175% 6 . With the outbreak of war the break of the war, to be followed in both franc was subjected to exchange restrictions 1066 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports and pegged in terms of sterling at a middle November 1938, continued during 1939 with rate of 176%. The maintenance of this level the exception of a few days at the outbreak involved a depreciation of the franc against of war in early September. In consequence the dollar between August 24 and mid-Sep- the French monetary authorities were able tember from 37.75 francs per dollar to 43.80, to increase their gold holdings; in order to or by 14 per cent, in the official market, while aid in providing the Stabilization Fund with quotations in the free market in New York the francs needed to purchase incoming gold tended to remain lower. two transfers of gold of Frs. 5,000,000,000 The French foreign exchange control, es- each were made from the Fund to the Bank tablished by decree of September 9, pro- of France (on April 20 and July 28, 1939). vided for the general prohibition of the export In a speech on December 13, 1939, the of capital from France, the authorization of Finance Minister stated that in the ten a list of banks to purchase foreign exchange, months prior to the war (i.e. November 1938 the restriction of sales to the Bank of France to August 1939) the repatriation of capital (later the Control Office), the control of all resulted in a gain of gold by the French dealings in gold by the Bank of France, and authorities amounting to 26,000,000,000 the repatriation or declaration of foreign French francs. From this figure it may be assets owned by residents in France prior estimated that the aggregate holdings of the to November 15 (later January 15, 1940). Bank of France and the Stabilization Fund Gradually the exchange regulations in France had risen probably to $3,300,000,000 at the and in Great Britain were eased as between end of August, which would mean that the the two countries, sterling being made more inflow of gold in June, July and August had freely available in Paris, and francs in Lon- averaged about $85,000,000 per month. Durdon, with care being taken to see that trans- ing the political crisis of the summer, as well fers could not be made from one market to as during the tension of March 1939, the flow the other in order to circumvent the regula- of capital to Paris was accelerated rather tions existing in the former. In London, steps than reversed. were taken to prevent sales of gold held by Shortly after the outbreak of the war, the French nationals there against other cur- return flow of capital was resumed, although rencies than sterling or francs. Finally, on a part of the gain in foreign assets was offset December 4, an Anglo-French monetary and by heavily increased purchases of supplies economic agreement provided for the mainte- from abroad. In the speech of December 13 nance of the existing franc-sterling rate un- the Finance Minister made known that transchanged for the duration of the war and for fers of gold and exchange to France had six months after the conclusion of the peace amounted to 10,000,000,000 French francs treaty, for the free use of the currency of since the beginning of the war. Further, in the other country and its acquisition against execution of the decree of September 9, 1939, the domestic currency without recourse to regarding the declaration of holdings abroad, gold. Sterling held by the Bank of France an additional 24,000,000,000 French francs could be used for purchases of raw mate- of capital, consisting of securities and instrurials in the British Empire, and further ster- ments denominated in foreign currencies, ling requirements of France would be fulfilled had been repatriated either by deposit with against French francs supplied to the United banks in France or by actual importation, Kingdom for the use of the British Expedi- without involving a foreign exchange transtionary Force and other expenditure in the action. French Empire. In addition, the two govern- In the same speech it was further stated ments agreed to divide equitably their expen- that the return flow of capital to France had diture in gold and dollars and to refrain come to an end. With the expiry on January from contracting credits or floating a loan 15, 1940, of the period during which assets abroad without preliminary agreement with abroad had to be declared, if they had not each other. Finally each party undertook to been repatriated, the support for the franc refrain from imposing new restrictions on arising from voluntary repatriations of imports from the other country in order to funds from abroad ceased to be a factor of protect its own market or for any monetary importance. reason. On September 11, 1939, the Secretary of The repatriation of capital to the French the United States Treasury explained that market, which had begun on a large scale in the monetary agreement established by the OCTOBER 1940 1067 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports Tripartite Declaration made by France, the NOTE CIRCULATION IN THE FAR EAST United Kingdom and the United States in [In millions of yen or yuan respectively] 1936 remained in operation; and, in particular, that the new exchange rates applied by 1934 1935 1936 1937 1938 1939 France and the United Kingdom did not constitute "competitive depreciation." Bank of Japan 1,627 1,727 1,866 2,305 2,755 3,818 Bank of Chosen 192 221 211 280 322 451 Quotations for the Reichsmark continued Bank of Taiwan 63 70 79 112 140 173 steady in terms of gold throughout the year Central Bank of Manchukuo 168 179 254 307 426 670 with occasional erratic quotations as, for in- Federal Reserve Bank of China 140 380 stance, in the New York market during the Bank of Inner Mongolia.- 35 60 last weeks before the opening of hostilities Huah-Hsing Commercial in September. Since the outbreak of war Bank 25 no rates have been quoted for the Reichsmark Four leading Chinese or for any other types of mark in London Banks 396 668 1,242 1,639 il,727 1 2,627 and Paris or, because of the difficulties of 1 End of June. 2 End of January 1940. communication, in New York. The so-called registered mark, the valuation of which The currencies of the countries of Latin abroad depends upon the possibilities in vari- America during the first seven months of the ous countries for using this type of funds, year were under the influence of the rawdeclined considerably during the course of the material depression which set in in the year. On the London market, for example, autumn of 1937, and during the last few the discount of the registered mark from months of the year were affected by the the free Reichsmark increased from 56 V2 European war. In a number of instances— per cent at the end of 1938 to 67% on August particularly in Mexico and Cuba—the cur- 30, 1939. In Switzerland, 100 registered rencies fluctuated in response to special cirmarks cost on the same dates 76.25 Swiss cumstances. In general, however, the South francs and 56.50 Swiss francs, corresponding American countries producing raw materials to discounts of about 57 and 68 per cent, experienced some improvement in their balrespectively. By April 1940 the rate stood ance-of-payments position as a result of the at about 36 Swiss francs. war, while Central America was adversely The transfer of the allegiance of the Japa- affected. nese yen from sterling to the dollar in Sep- Since 1931 one of the greatest difficulties in tember 1939, involving a depreciation of the exchange markets has been the erratic about 14 per cent in gold value, applied movements of large amounts of highly volaindirectly to the various currencies linked to tile funds. In this respect a decisive change the yen, including the Manchukuo yuan and occurred in the autumn of 1939. Capital the Tientsin yuan. The latter was subject to movements were made more difficult through heavy fluctuations in value in terms of the the imposition of exchange restrictions; furdepreciating Chungking dollar, going from thermore the amounts of foreign capital held a 30 per cent discount in March 1939 to a in various European markets had been heavpremium in the autumn of the year and ily reduced by the massive outflow of recent finally, in December 1939, again to a dis- years. count. Moreover, on May 16, 1939, the On the other hand, disposal of exchange Huah-Hsing Commercial Bank opened in to pay for necessary imports has gained in Shanghai under a charter from the Nanking importance and long-term investments are "Reformed" Government and the notes of being mobilized to provide liquid funds for this Bank are acceptable as legal tender for commercial needs. Movements of gold and payments under the jurisdiction of the Nan-capital will be more closely related to curking Government. This currency was created rents of goods and services and in that way to facilitate export and import financing and have a greater effect on the distribution of was to be linked at par with the Chungking active purchasing power and thus also on dollar. Several months after its establish- cost and price relations. For the time being ment, however, it was stabilized at the rate the exchange markets are largely dominated of 6d. because of the fluctuations of the by controlled rates which most likely will National currency. The development of note remain in force for the duration of hostilities. circulation in the Far East is illustrated in The adjustments necessary when peace rethe following table: turns will, however, have to take account of 1068 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports the fundamental changes in relative cost and Since 1932 the recovery in world industrial price structures, which have already begun production has been at a higher rate than the to be noticeable as a result of domestic and improvement in international trade, which foreign influences in various countries. means that the advance in the domestic activ- Foreign trade.—The improvement in inter- ity of the various economies has been greater national trade, which continued from the than in the exchange of goods between them. depths of the depression in 1932 up to the The failure of foreign trade to keep pace with boom of 1937, suffered a setback in 1938 domestic production is no doubt mainly the when the volume of goods exchanged dropped result of increased protection, autarchic tenby about 8 per cent. Data for the first eight dencies, monetary difficulties especially affectmonths of 1939 show a certain advance in ing international transactions and a virtual the volume compared with the correspond- cessation of foreign lending; but it may also ing months of the previous year. The ad- be connected with a natural increase in the vance became of importance in the spring ability of many individual countries to meet and summer of 1939 under the influence of their requirements in a higher degree from better business in the United States (reflected domestic production. It is, however, unlikely in higher imports) and increased purchases that such tendencies even if intensified by the by European governments for the constitu- present war will actually diminish world tion of reserve stocks. After the outbreak trade in the long run. The volume of interof war in September the interruption of com- national trade in 1938-39—despite the setmercial relations caused a decline in the back from the previous boom year—was still aggregate volume even though in certain some 15 per cent higher than in 1913, and directions the exchange of goods was inten- everything points to the conclusion that insified. During the war of 1914-18 the volume ternational trade will continue to advance of international trade declined in sympathy whenever there is an increase in production with the decrease in world production, as and general well-being. may be seen from the graph on page 1057, For most countries on the continent of and a similar contraction may again be Europe the development of German trade in experienced. recent years has been of outstanding impor- There is, in general, a high degree of cor- tance. For the first time since 1934 Germany respondence between the indexes of world had an import surplus in 1938, amounting to production and of international trade—two RM 192,400,000, which led to an increase indexes which, of course, are calculated on in the debt due by Germany to other counthe basis of wholly independent sets of data. tries. In 1939, however, an export surplus Indeed, from 1850 to 1929 the growth of was again achieved. Trade with southeastern world trade (as well as the decline during Europe more than doubled between 1929 and the war period 1914-18) was very much at 1938, amounting in the latter year to about the same rate as that of world industrial pro- 10 per cent of Germany's foreign trade. For duction; and the decline from 1929 to 1932 the Danubian and Balkan countries Germany was also in the same proportion for the two has become the main field for imports and indexes. Compare the graph on page 1057, to exports. which reference has just been made, with For France information regarding the the following graph, for the years since 1929: trade balance is available only for the first seven months of the year, during which the WORLD INDUSTRIAL PRODUCTION AND INTERNATIONAL import surplus was 5,627,000,000 French TRADE francs as compared with 7,977,000,000 [Indexes on base 1929 = 100] French francs in the corresponding months of 1938. Imports increased in value by 6 per cent (as a result of the depreciation of the franc) but fell in volume by 12 per cent, less raw material being imported owing mainly to an increase in the output of French mines. On the other hand, exports rose in value by 28 per cent and in volume by 5 per cent. The exchange of goods between the mother country and the colonies showed a distinct advance both in value and in volume. 1069 OCTOBER 1940 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports The import surplus of the United Kingdom of Canadian goods reached the highest level increased by only £14,000,000 from 1938 to since November 1936 and the highest Decem- 1939, despite the sharp decrease of exports ber figure since 1929. Imports were quickly in the four months of war in the latter year. affected by the rise in income level in Canada UNITED KINGDOM FOREIGN TRADE IN 1938 AND 1939 [In millions of £ sterling] January-August September-December Whole year 1938 1939 Change 1938 1939 Change 1938 1939 Change Retained imports 571 567 - 4 287 273 -14 858 840 -18 Exports 307 314 + 7 164 125 -39 471 439 -32 Import surplus 264 253 -11 123 148 +25 387 401 +14 Actual purchases from abroad in the last as well as the rise in world prices, but the four months of the year were far larger than export surplus was maintained or even the import figures reveal. In the first four slightly increased. months of 1940, the import surplus rose to The war had an effect too on Latin Ameri- £237,000,000 compared with £116,000,000 in can trade. Although industrialization in 1939. Exports rose by 9 per cent in value, most Latin American countries has made but the increase in imports amounted to 45 some progress since 1914-18, these countries per cent. are still essentially dependent upon overseas Among the remaining European countries, trade for the sale of their surplus output of Denmark, Norway, the Netherlands, Sweden crude products and for the satisfaction of and Switzerland all had higher import sur- their requirements in manufactured articles. pluses in 1939 than in 1938, the main reason The immediate effects of the war were, on the being increased imports in the last quarter one hand, the loss of the important trade with of the year. Germany, and, on the other hand, increased For the countries which were neutral in exports of industrial raw materials and basic the winter of 1939-40 the conclusion of trade foodstuffs to other countries. The impact agreements with the belligerents on both was not the same, however, on all countries sides were important means of maintaining in the area. After the first few weeks in as much of their foreign trade as possible. September the increase in demand did not This network of agreements tended, however, extend to the higher types of foodstuffs— to be one-sided in effect: special attention coffee, tropical fruits and sugar; as a result was naturally paid to the sinews of war— several of these countries, particularly those iron, steel and oil—and to basic foodstuffs, of Central America, suffered from the inwhile consumers' articles, especially those crease in import prices without benefiting of a luxury character, had to assume a second- from a sustained improvement in their exary place. In some instances new clearing ports. agreements were made between belligerents In the Far East Japan's foreign trade beneand countries outside Europe, e. g. between fited to some extent from an increase in the United Kingdom and the Argentine; and demand associated with the war, but not in in addition ad hoc arrangements were made the same degree as in 1914-18, one reason with the governments of some extra-Euro- being the reduced surplus of goods available pean countries for the supply of special war for foreign consumption. The export surplus materials, etc. of all Japan (including Korea and Formosa) Canadian exports from the spring of 1939 rose from Yen 58,000,000 in 1938 to Yen attained a level above that of the previous 802,000,000 in 1939, but the improvement year and were further stimulated from Sep- in the trade balance in relation to countries tember onwards by large war orders and an outside the yen area (i.e. to other countries increase in sales of wood and pulp, as Scan- than Manchukuo and Northern China) dinavian shipments of these products were amounted only to Yen 190,000,000, as shown sharply reduced. In December 1939 exports by the following table: 1070 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports FOREIGN TRADE BALANCE—ALL JAPAN trade. Perhaps the most noticeable of these departures from custom have been the [In millions of yen] changes in trade routes, in which certain ports, e.g. Genoa and Bordeaux, have gained Export (+) or import (—) surplus 1937 1938 1939 in importance, while the traffic through Ham- Yen area __ _ +326 +598 +1,152 burg, Rotterdam and Antwerp, for example, Non-yen area ___ -963 -540 fell abruptly in the last four months of 1939. Total -637 + 58 + 802 An even more striking example is provided by traffic through the port of Basle, which since 1929 has been developed to serve as the In September an attempt was made to main import channel for bulky goods into reduce exports to the yen area since they are Switzerland. At the beginning of September not productive of foreign exchange, but the 1939 all activity in the port of Basle was restrictions imposed have not been fully efabruptly terminated and Swiss merchants fective. As regards the trade with countries had to make arrangements for the import of outside the yen area, the deficit in relation to oil, coal, iron, steel, rubber, etc., over land. the United States was reduced by Yen 130,- The general tendency as a result of the war 000,000, larger imports being more than has been an increased importance in traffic counterbalanced by an increase of Yen 250,by rail reflected in an improvement of the 000,000 in exports, due mainly to higher earning capacity of various railway systems. prices for raw silk. Exports to Latin America, The consequence is, however, that transport British India and the Netherlands East Indies costs account for more in the value of finished also increased, while sales to Europe fell. articles, and in the final analysis it is the The foreign trade of Australia and New consumer, whether an individual or a public Zealand was also affected by the war, but the body, who has to pay for the extra charges. reactions were somewhat different in the two countries, owing to a divergence in local conditions. Australian exports of merchandise MERCHANDISE TRAFFIC IN THE RHINE PORT OF BASLE (as distinct from newly-produced gold) rose [Monthly, in thousands of tons] sharply above the figures for the previous year, beginning with the monthly returns for October. Sales of raw materials and foodstuffs, principally to Great Britain, accounted for the greater part of the increase in the volume of goods shipped. In addition substantial sales were made against which funds were placed to Australian account in London, but the goods in question did not enter into 1935 1936 1937 1938 1339 1940 the export figures as they were stored in Australia pending shipment. Goods were Price movements.—In the realm of prices also bought from New Zealand by the British the war did not cast its shadow before it. Government and payments in advance of After the collapse of the short-lived boom delivery were made into the country's ac- of 1936-37 prices of commodities in general, count in London, but reported exports failed and of raw materials in particular, showed to expand substantially during the final quar- on the whole a tendency to decline and conter of the year. The total volume of exports tinued to do so up to August 1939. It may in 1939 as well as in 1938 (adjusted for pricebe that in Europe mounting armament exchanges) was lower than the average for the penditure, government purchases of reserve five years 1933-37, the decline being due to stocks and sustained private investment exincreased domestic spending on public works erted a stimulus towards higher prices, but and development of local industries, which any upward movement would appear to have diverted men and materials from the export beep checked by the low level of industrial trades. activity and poor demand for materials in Advance purchases by the United Kingdom the United States. As soon as war broke out in Australia and New Zealand are examples prices rose outside of Europe on the expectaof the exceptional measures taken after the tion of a high rate of consumption of raw outbreak of the war constituting a departure materials and finished products for military from the normal practices of international purposes and of dislocations in the normal OCTOBER 1940 1071 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports trade channels. In Europe itself the whole channels due to Trading with the Enemy structure of costs and prices was even more Acts, blockades, wartime trade agreements, affected by renewed currency depreciations, government pre-emption of supply, official higher transport costs, increased taxation diversion of imports and the imposition and the introduction of price control in coun- of export and import prohibitions in order tries which had previously maintained rela- to conserve stocks or to reduce the outlay tively free markets. of foreign exchange; The movement of prices in those countries (iii) Changes in currency relationships outside Europe which are primarily raw- in the form of fresh depreciations and the material-producing areas showed very much introduction of exchange control, the quotathe same tendencies as in the United States tion of dual rates and the fixing of altered but prices of finished articles have been sub- rates under clearing and payments agreeject to a more pronounced rise, these articles ments ; being in larger measure imported and there- (iv) Changes in taxation, including cusfore affected by the sharp increase in trans- toms duties, excise, sales and turnover port costs. Basic foodstuffs—grain and meat taxes; —rose in price immediately after the out- (v) Direct official interference in the break of war and maintained their gains. mechanism of prices and of demand and Higher-grade foodstuffs—coffee, cocoa, tropi- supply through rationing and requisitioncal fruits and sugar—also rose in price at ing, systems of permits and licenses to buy first but did not hold the level attained. Tex- and sell, the imposition of maximum and tile raw materials were markedly influenced minimum prices as well as more thoroughby the strong demand for war purposes: going types of price control. Indian and Egyptian cotton were sold in large quantities at advancing prices; Great The disparities between developments of Britain bought the entire wool output of the prices in "free'' areas and in Europe may be Empire at higher prices than those previ- illustrated by a comparison of indexes of ously prevailing; silk prices also rose, as roughly the same basic commodities in the already mentioned; and partly under the United States and the United Kingdom. Alinfluence of speculative demand the price ready in September American prices rose of jute—the basic product for the making sharply when British prices were increasing of sandbags—rose 150 per cent between Au- considerably less, despite the depreciation of gust 1939 and mid-February 1940 but later sterling, which in ordinary circumstances suffered a setback. Among the industrial would have instantly affected prices of priraw materials, non-ferrous metals (tin, cop- mary commodities entering predominantly per, zinc and lead) all moved sharply upward into international trade. By the time Ameriin price at the outbreak of war, except where can basic commodity prices had suffered a official control came into operation. Rubber setback the rise in British quotations finally was regulated in output and recorded a net took hold and carried the British indexes far gain in price up to the end of April 1940. above the American. The initial slowness There were also increases in oil prices, which with which British indexes rose was no doubt were largest in producing areas with easy in a large measure due to the official price access to consumption outlets. control, while later on some commodity prices, Price developments in Europe also reflect, and in particular those for cotton and silver, of course, changes in supply and demand, but tended to fluctuate in response not to the ofthe ordinary conditions of the markets have ficial rate for dollars in London but to changes been overshadowed by a series of dislocating in the value of sterling as quoted in the free factors, the most important of which may be market in New York. summarized as follows: Other British prices than those of primary (i) Sharp increase in transport costs, products also tended to rise under the influparticularly in shipping freight rates but ence of increased costs of production (as realso in rail charges, higher premiums for gards both materials and labor) and the genmarine and war risk insurance, heavy ex- eral dislocation in industry and trade propenses occasioned by the delays in port, by duced by the war effort, including the partial reshipping and by the necessity of fol- evacuation of certain closely-settled areas. lowing circuitous routes; Wages were increased in many industries, (ii) Dislocation in peace-time trade partly as a result of the scarcity of skilled 1072 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports workers and partly in sympathy with the turnover tax at the same rate applicable to increase in the cost of living, which under each wholesale and retail transaction. a number of trade union agreements called In contrast to these developments, price for a compensatory increase in wages. The indexes in Germany have shown a marked cost of living was, of course, affected by the stability prior to and following the outbreak country's dependence on imported foodstuffs, of war, no doubt under the influence of the but measures were taken to control prices and thorough German price control, which had to ration such commodities as butter, bacon, been established, basically in its present form, ham and sugar. At the beginning of Decem- in 1936 but was modified in a number of ber 1939 the retail food index had risen 14 respects upon the outbreak of war. Thus per cent above September 1, but then be- the scope of the system was enlarged since came steady under the influence of subsidies prices outside the control tended to advance. applied to an "iron" ration comprising a Rationing was introduced on a wide basis, limited number of foodstuffs and costing the including, in addition to foodstuffs, restricgovernment an average of £1,000,000 weekly. tions on the purchase of clothing and shoes. In France the publication of official price At the beginning of the war extra pay for indexes was discontinued after the outbreak overtime and night work was suspended and of war, but it is clear from the character profits resulting from lower labor costs were of the measures taken to control price in- either to be paid over as taxes or to be used creases that a rise occurred between Septem- in the reduction of prices paid by the governber 1939 and March 1940. In the summer ment. Later, however, this order was in part of 1939 French prices were still on the whole rescinded and extra pay for overtime was below the general level of world prices cal- granted anew, beginning with the eleventh culated over the exchange and there was thus instead of the ninth working hour per day. a margin of adjustment still in hand. When In the field of agricultural prices, which, beincreased pay has been granted to workers in cause of the scattered and individual charrespect of overtime, contributions have been acter of the producing units, are in general imposed to ensure at the same time an in- less amenable to control than prices of induscrease in revenue for the State and a con- trial products, the German price control has, traction in monetary purchasing power. In nevertheless, been successful in keeping down Italy the regular publication of price indexes most prices. Bread, flour, meat, sausages, has also been discontinued, but at the meeting sugar and potatoes have remained unchanged of the Central Committee for Corporations in price. Some upward adjustment has, howon March 9, 1940, it was stated that the cost ever, been made in the price of milk and of industrial production had risen markedly butter in order to ensure continuity of supby reason of increases in costs of foreign plies. products, among which coal had risen as In the Balkan countries prices have genermuch as 69 per cent since August 1939. It ally tended to rise in response to a keen dewas established that the cost-of-living index mand for their exportable products, recently had increased 17 to 18 per cent over the year coupled with bad prospects for the 1940 harto March and, at the same meeting, wage invest. A severe winter, together with the creases of 10 to 15 per cent were agreed upon. overflowing of the Danube, reduced the acre- The point was also made that the index numage from which average grain yields may be bers of prices in current use were not truly expected, and several of the countries inrepresentative of the state of affairs and volved have already been forced to reduce would be recalculated. The rise in prices exports of agricultural products in order to which occurred reflected in particular exconserve adequate supplies for domestic use. traordinary influences such as increased costs The greatest price increases have occurred of transport of imported commodities and in the Far East. In Japan prices have been especially domestic influences such as the rising since the war in China began in 1937 measures taken to protect and develop agriand for a number of reasons the rise was culture and generally to promote autarchic accentuated with the outbreak of hostilities production and to improve the social posiin Europe. The yen followed the decline of tion of the working class. Increased taxation sterling and thus depreciated in relation to a also played a part, especially when in Febrularge number of currencies; as import costs ary 1940 the 2 per cent sales tax levied only rose, some speculative activity made its aponce on each commodity was replaced by a pearance in the export markets and there OCTOBER 1940 1073 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports was a failure of the rice crop in Formosa. In EXPORT AND IMPORT PRICES FOR SOME COUNTRIES Shanghai the spiral increase in prices is largely attributable to the depreciation of [Monthly indexes—August 1939 = 100] the Chungking yuan, combined with the increased cost of many goods on world markets. 1939 1940 The sudden changes in relative prices which have occurred since the outbreak of war have produced widely different effects on the fortunes of different countries. The relation of import to export prices—or the terms of trade—constitutes, so to say, a measure of the benefits which a country derives from its foreign trade at one time as compared with another. When a country's export prices rise in relation to its import prices, it is able to obtain a larger volume of imported commodities for a given volume of exports; and, vice versa, when its import prices rise more than its export prices a greater amount of exports is needed to obtain the same volume of imports. The following graphs of monthly export and import prices reveal the considerable changes which have occurred in the terms of trade of different national economies since the middle of 1939. In some instances apparent changes are no doubt due to the construction of available indexes; the figures for the United States, for example, are derived from the value of all American foreign trade and show much less fluctuation than indexes based on the quoted prices of a limited selection of outstanding exports and imports (generally raw materials and agricultural products traded in active markets). Both import and export prices have risen since August 1939 in every country included in the graph, with the exception of the export prices in Costa Rica, but four-fifths of the export trade of this country consists of coffee and bananas. For Europe the rise in import prices greatly exceeds that of exports, while for the United States and in the raw-materialproducing areas outside Europe the terms of trade have moved in the opposite direction. Even within Europe broad differences in the development stand out. In the Balkan region the adverse movements of the terms of trade have been much less severe than in Scandinavia, partly bcause of the intense demand for Balkan exports and partly because of the relatively more moderate deterioration in transport conditions in this region. Differences are also noticeable within the same geographical area, as, for instance, between Denmark and Sweden. 70 An important cause of changes in the 1940 1074 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports terms of trade was the disparate movement and industries, over the right of firms to of freight rates in different parts of the remain in or enter specific branches of proworld. Freight rates have risen generally, duction, and generally over the marketing of but not through an increase in the total agricultural products. The most important volume of world trade; as a result of block- element in this more extensive control is ades and other wartime measures the actual necessarily the fixing of wages and the disvolume of goods exchanged between nations tribution of the labor force. In this connechas fallen, as was the case in 1914-18. But tion it is of interest to mention the German losses at sea reduce the number of cargo boats Price Commissioner, who is in possession of available and delays, often serious, diminish very wide powers but does not exercise superthe carrying capacity per ship. These fac- vision over salaries (as distinct from wages) tors do not act with the same intensity all nor over interest rates—these being practiover the world; while rates between the cally the only limitations to his sphere of United States and the eastern ports of South action. The technical measures adopted to America have increased only 10 per cent, enforce the control of prices are, of course, rates for shipment from the United States to inextricably associated with the vast maze Scandinavia had risen by the beginning of of export and import prohibitions, the grant- 1940 by over 100 per cent. Often the increase ing of subsidies, the levying of special taxes is even greater. and the application of direct restrictions on Lloyd's List for the United Kingdom indi- consumption. Rationing is generally applied cates a total rise of 400 per cent between in the first place to foodstuffs, but may also August 1939 and March 1940, with com- be extended to industrial raw materials when ponent continental increases ranging from scarcity of supplies necessitates a planned hy% fold, for freights between the Unitedallocation between different firms and indus- Kingdom and South America, to 3^ times, tries. The different systems of rationing of for freights to ports in the Pacific Ocean and consumers' goods may be as elaborate as in Australia. Germany or may be applied only to a limited A rise in costs affecting producers in gen- number of foodstuffs and, for instance, to eral must as a rule be followed by a rise in petrol for the private use of motor cars. prices, for the possibility of granting sub- One of the most usual forms of control is sidies—open or veiled—is,^ after all, neces- the "price stop," which forbids the increase sarily limited. Systems of price control, in- of prices above the level prevailing on a fixed troduced since the outbreak of the war in a date except under certain conditions. Gernumber of countries which previously ad- many adopted this system by a law in 1936 hered to the principles of free economies, can and the base date still in effect is October 17, therefore either limit themselves to ensuring 1936; in England, the base date is August 1, that prices are not raised more than changes 1939; in France, September 1, 1939 (decree in costs justify, or can be extended to regu- of September 9 supplemented by that of late the cost of different factors of produc- February 29, 1940), and in Japan, Septemtion. In the former case the simple aim of ber 18, 1939. Under this type of control the the price control (and this applies to most exceptions may, of course, become extremely of the systems initiated since the war) is important. In Germany, no price can be usually to prevent speculation, hoarding and changed without preliminary approval by the profiteering in goods affecting the general Price Commissioner, while in England prices standard of living and to keep prices and may be adjusted above the August 1 level profits from rising unduly on supplies bought when such adjustment is necessitated by the by the government. Such simple systems are increased cost of materials (domestic or imfound especially in neutral countries and in ported) or higher costs of selling or producthose far from the theatre of war, as in the tion, including wages, salaries, manufactur- Argentine, Australia, British India, Bulgaria, ing expenses, insurance premium charges Estonia, Greece, etc. and advertising expenses. In France author- In the more far-reaching systems of con- ity to increase prices could at first be granted, trol, when the objective may be to prevent by way of exception, when such increases almost every rise in prices, the powers of the were "justified by the de facto conditions in controlling body are necessarily extensive which commercial concerns were carrying on and include control over wage rates, over the business or by fluctuations in prices of imallocation of workers between different plants ported raw materials"; but in a decree of OCTOBER 1940 1075 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports April 9, 1940, it was laid down that, since and the normal functions of the price mechanprices in France had become adjusted to ism (increased prices acting as a stimulus to world prices, which in turn had levelled off in production and a check on consumption) are February, there should, from May 1,1940 on- no longer fulfilled. Rising prices in wartime wards, be no further increases, apart from ex- often present a real dilemma. On the one ceptional cases in which authorization might hand, price control is deemed essential to be granted, subject to certain conditions ensure that the necessities of life are kept specified in the decree, "when the increase in within reach of the lower-income groups of cost price is the result of a rise in the price the people; on the other hand, rising prices of imported raw materials and exceeds a are not always a sign of speculation, hoarding minimum percentage, to be fixed according to or profiteering, but may reveal deeper malthe circumstances by the National Committee adjustments between production and confor Price Control." sumption under the new conditions; and, as The same result is achieved in a somewhat long as the price control concentrates wholly different fashion by the promulgation of on the price phenomena themselves, it may maximum prices, which can be fixed more be merely dealing with symptoms. This danger is, of course, generally realized: as freely according to the conditions of producfar as monetary conditions are concerned, tion and the available supply than when referthe obvious objective of official measures ence is made to a given date in the past. must be the prevention of an inflationary Attempts are often made to fix "just" or expansion of purchasing power in the hands normal, "fair" or natural prices on this basis. of the public, which would render the effective Finally, the experiment has been made, in a control of the price level more difficult or limited number of cases, of basing the selling indeed impossible. price on the "average cost" of an industry, taking into consideration that different firms produce at different costs per unit of output, INTERNATIONAL CAPITAL MOVEMENTS and that the "fair" return for the lower-cost The movement of capital to the United producer may not be sufficient to cover the States reached its climax in 1939 when some costs of another firm, which by reason of $2,000,000,000 was transferred from abroad, locality, size, etc., cannot produce as cheaply. a movement generally as unwelcome to the This type of scheme is said to be operative recipient as to the countries losing the funds. with regard to a number of German indus- The only other national economy experitries and also under the iron and steel control encing an appreciable afflux of capital in 1939 in the United Kingdom. was France, but this movement, essentially The position is very different under the a repatriation of French funds, did much to strain of war when the supply of goods be- strengthen the country's financial position, comes progressively smaller while demand weakened in the past by capital flight. is increased by extraordinary requirements The war has led to a further dislocation of representing the needs of the state; for the foreign trade financing, although pre-paymonetary purchasing power in the hands of ment for imports has benefited the rawthe public is abnormally expanded. Then it material-producing countries, as is shown is difficult to stop at some "half-way house." in a striking way by the growth of the ster- Generally one measure leads to another: de- ling reserves of the raw-material-producing crees are issued forbidding holders of goods members of the British Empire. Quotations to keep them off the market, to refuse the of foreign bonds fell heavily in the first three satisfaction of normal demands, or to raise quarters of the year but the securities of prices indirectly through changes in the overseas primary-producing countries in parterms of sale customary in the trade or ticular staged a sharp recovery. In present through a deterioration in the quality of the conditions foreign lending has practically goods delivered. The authorities often find ceased but it is evident from statements made themselves compelled to step in and take in authoritative quarters that the question over the total supply available, in which case of possible foreign credits in the reconstructhe distribution is wholly in the hands of tion period after the war is already being official bodies. In these circumstances the considered. prices that are fixed have much less relation In the six years 1934-39 the increase in the to the conditions of supply and demand than United States gold stock from imports those which would obtain in a free market; amounted to some $10,000,000,000, of which 1076 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports at least four-fifths represented a capital position deteriorated. In addition to the movement of a nature and volume such as increase of the gold holding due to incoming has never before been experienced. True, the liquid capital, some 24,000,000,000 French liquidation of earlier short-term foreign francs of securities previously held abroad credits plays some role in this movement, but have been registered in France or physically to an insignificant extent compared with the repatriated following the introduction of ex- "international liquidity crisis" of 1931-32. change restrictions and of the obligation to Estimates made at the Bank for International declare assets held abroad. Settlements at that time indicated a reduc- A net increase of about $100,000,000 of tion of the total outstanding international French dollar assets reported in the United short-term credit volume from around $14,- States during 1939 doubtless represented a 000,000,000 in 1930 to $8,000,000,000 at the concentration of funds in official hands as end of 1932. This vast liquidation fell pri- private holdings were sold (partly over marily on the reserves of central banks and London). But a great part of the repatriated was one of the immediate causes of the cur- French funds came from England, where rency depreciations and the introduction of private gold holdings and balances on French exchange restrictions in those years. But of account had been very large. The Exchange the $10,000,000,000 gold shipped to the Equilization Account came under fire from United States $6,000,000,000 has come from several points during the first eight months new production and a further $1,000,000,000 of 1939: there was an outflow of capital parfrom the hoards of the East. The remaining ticularly towards France and the United $3,000,000,000 came largely from those cen- States, certain central banks converted stertral banks which, at any rate in recent years, ling resources into gold, the English balance held such substantial reserves that the loss of current payments was passive while the produced little deflationary effect in the London funds of the Empire were drawn countries from which the capital flowed. down to meet the needs of international Although the records of the movement of payments. capital to the United States probably cov- It is not possible to give precise figures ered little more than half of the total influx from which a complete picture could be in 1939, these statistics are the most per- obtained. In the twelve months to March fected that are published. For other coun- 1939 the total gold reserve of the Bank of tries the fragmentary data that exist must England and the Exchange Equalization be arranged as a mosiac to form a more or Account was reduced on an average by about less imperfect pattern. The influx of capital £24,000,000 a month and an outflow continued from abroad to France was very dissimilar until August 24, when the exchange control in composition and motivation from that to temporarily withdrew from the market. the United States. The French recovery The merchandise import surplus for the dating from November 1938 was accompanied first eight months of 1939 was £253,000,000 and sustained by a repatriation of French against £264,000,000 in the same period of capital exported in previous years. As there 1938 and the current balance of payments in is reason to believe that the current balance 1939 was probably not very different from of payments was approximately in equilib- 1938, i. e. passive at the rate of about £1,000,rium (until the special imports made since 000 a week. It is difficult to disentangle the the beginning of the war), the monthly addi- capital movements to the United States and tions to the gold stock in this period give some to France as a large part of the repatriation indication of the volume of incoming capital. to France from the United States passed In the ten months up to the outbreak of through London: the capital flow to the war the gold holdings of the Bank of France United States from England, reported at and of the Exchange Stabilization Fund in- $200,000,000 (according to the U. S. Treascreased by 26,000,000,000 French francs, ury Statistics), say £43,000,000, from the while a further 10,000,000,000 French francs beginning of January up to August 23, 1939, came in in the three and a half months to mid- is thus a net amount. Moreover, a large December. Except for the unusually high proportion of the £150,000,000 repatriated to influx in December 1938, probably due to a France in the ten months to August 1939 large extent to the closing of exchange and came directly from England. But in so far gold positions, the repatriation of capital as this French capital was previously held tended to be heaviest when the international in private gold hoards in London it did not, OCTOBER 1940 1077 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports of course, reduce the English reserves. In sterling reserves of the West African Curaddition, certain central banks which had rency Board, for example, fell from £20,000,held sterling balances and bills as part of 000 to £12,000,000 in the two years to June their reserves converted them partially or 1939. Altogether there resulted a drain of wholly into gold to the extent of perhaps over £1,000,000 a week on the English gold £35,000,000. Further, the London funds of reserves throughout the two years—one reathe Empire were drawn down by at least son for the undertone of weakness in the £20,000,000 to meet payments largely out- sterling-dollar rate during the period, obside England. London is the reserve center scured until the middle of 1938 by the considfor a group of countries mainly producers erable reduction of foreign dollar balances of primary commodities whose holdings of in the United States, already mentioned. For sterling balances and bills fluctuate widely England, the strain resulting from the drawwith the good and bad seasons. ing-down of the Empire's sterling reserves The graph shows how the normal rhythms is, of course, offset to some extent by the fact of exporting and importing seasons in 1935 that imports of primary commodities are and 1936 were followed by exceptionally good cheaper at these times. conditions for primary producers in the first The downward trend of London funds was half of 1937. But the United States, the sharply reversed from August 1939—in the chief importer of raw materials, suffered a eight months to March 1940 the whole of the sharp setback in the autumn and export ground lost by the Empire countries in the prices for these countries fell, while the previous two years was recovered and the stimulus given their internal economies in sterling reserves of the six countries shown 1937 led to heavy imports in 1938 and 1939.in the graph are now above the highest point In the case of New Zealand these conditions of 1937. Large-scale purchases of primary products (cotton, jute, wool, dairy products, copper, etc.) by the British Government LONDON FUNDS OF THE BRITISH EMPIRE throughout the Empire have brought this [Monthly figures in millions of £ sterling] dramatic change in the picture. Over £A 100,000,000 has been spent in Australia alone. And while prices have been satisfactory for the exporters payment has been made in cash for wool on appraisement and for many other commodities on shipment, so that the seasonal increase in London funds began earlier than usual. These conditions apply not only to the countries shown in the graph but over the extent of the Empire. A safety valve against the accumulation of too bulky sterling reserves is provided by the past indebtedness of these countries to London. In 1938 England had £1,000,000,000 invested in the bonds of Empire governments (in addition to local government bonds and commercial and industrial securities) and lending continued in the first part of 1939. In some cases gifts to the British Government have been made out of sterling funds ; 1935. such, for example, as the £1,000,000 from the Straits Settlements in April 1940. In the were aggravated by the expansionist policy case of countries outside the British Empire of the government and by a flight of capital. other arrangements have been made, e. g. the The sterling reserves of the six countries sterling received by the Argentine for its shown in the graph fell by £100,000,000 in exports is placed in a special account at the little over two years. In addition, sterling Bank of England, any surplus on which above funds were used to support the Shanghai £1,000,000 may be converted into gold (and dollar; and the various Currency Boards of reconverted into sterling whenever required). the Empire also drew on their London funds: After England the countries most con- 1078 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports cerned on account of capital outflows in 1939 plus was particularly high in the three were Belgium, Holland, Switzerland and months November 1939 to January 1940. As Sweden: in general these countries were little imports had generally to be paid cash or affected by the repatriation of French capital even in advance instead of on the usual credit and more by the widespread movement to- terms, a further extraordinary but temporary wards New York, but each case had its in- demand for foreign exchange, estimated at dividual features. The efflux from Belgium some 50-150,000,000 Swedish kronor, arose was temporary but rather violent. In Holland on this account. the Nederlandsche Bank lost gold intermit- Indeed, foreign credits granted for trade tently throughout the year. During the first financing throughout the world have become four months of 1939 there was some flight shorter during the year, or, more usually, of capital, particularly of foreign funds, from have been replaced by cash terms and even Switzerland and the National Bank lost over payment in advance, as stipulated by the 400,000,000 Swiss francs in gold and foreign United States Neutrality Law. "Cash and exchange. The rest of the year was com- carry" terms were thus applied by law to paratively calm. belligerents and "carry" terms to a large At the time of the Munich crisis there was number of non-belligerents. an afflux of foreign capital to Sweden mostly In any case "cash" terms were gradually from neighboring countries, deposits of for- being applied to most European countries by eign banks and bankers with Swedish com- American exporters before the war began. mercial banks increasing in the month of But the effect of the Neutrality Law was September 1938 by nearly 100,000,000 Swe- further to tighten up conditions and to imdish kronor, to a total of 250,000,000 Swedish pede normal trade financing. kronor. As since early 1937 it had been the The introduction of foreign exchange repolicy of Swedish banks to carry liabilities strictions in England and France and the to foreigners in excess of their foreign assets, calling of foreign trade credits had similar this movement was accompanied by an in- effects. Being forced to pay cash or even in crease in the reserves of the Riksbank. Dur- advance for imports from the United States, ing the following twelve months up to the these countries in turn tended to export also outbreak of war there was a reflux of foreign for cash only, especially to Europe. Some bank deposits and a mild decline of the Riks- countries, such as Norway and Denmark bank's reserves. An abrupt change took which imported generally on a three or fourplace on the outbreak of war in Europe, ac- months' credit basis, found themselves centuated by the Russian-Finnish war. In obliged to pay for four or five months' imthe seven months to the end of March 1940 ports, including the laying-in of reserve the Riksbank lost some 700,000,000 Swedish stocks, in a comparatively short space of time. kronor in gold and foreign exchange, i.e., Foreign trade contracts are generally made over one-third of its reserves, the losses out in the currency of the importer or exbeing particularly high in October and porter (the importer being desirous of pay- December 1939. There were a number of ing in a "weak" and the exporter of receiving reasons for this efflux. Swedish assistance a "strong" currency) or in some internato Finland in the form of gifts and credits tional currency such as the dollar. But under opened has been estimated to have been the British regulations, for example, imports not less than 400,000,000 Swedish kronor, to England from countries other than the a considerable part of which led to increased United States may not be paid for in dollars. Swedish imports or direct losses of foreign With the lapsing of such a large proportion exchange to cover Finnish imports from of the world's foreign credits on trade acother countries. In addition, there was some count the banking systems in many countries efflux of foreign funds, impeded, however, have been called upon to finance their own by the restrictions imposed on foreign sell- foreign trade, particularly their imports, and ing of Swedish securities. Further, the cur- this is one of many reasons for the increase rent balance of payments was estimated to of the internal credit volume in most counbe passive to the extent of 250-350,000,000 tries on the outbreak of war. To some ex- Swedish kronor in 1939 (against an active tent the inability or reluctance of exportbalance of 48,000,000 Swedish kronor in ers to give the usual credit terms has been 1938), owing in part to the formation of made good by official or semi-official bodies, reserve stocks: the merchandise import sur- such as the Export-Import Bank of the OCTOBER 1940 1079 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports United States formed in 1934 specifically to the first eight months of the year, of which aid in financing and to facilitate exports and only $35,000,000 out of $85,000,000 was for imports between the United States and for- new money. In May 1939 the French Goveign countries, particularly through inter- ernment placed Fl. 155,000,000 4 per cent 6mediate and longer-term credits (up to five year bonds with a group of Dutch banks and years). Fl. 100,000,000 31/2 per cent 6-year bonds Foreign trade credits granted in Europe (later issued to the public at 97!/2) with a directly by the governments or by govern- Dutch-Swiss group. These operations permental bodies have generally been of a polit- mitted the consolidation of a number of shortical nature and often to cover supplies of term loans made by the French Treasury and war materials. The British and French French railways. A substantial part of the credits to Poland, to Greece, Roumania and total Fl. 255,000,000 was placed outside Hol- Turkey, and German credits to Russia are land and Switzerland, the latter country, in of this nature. More normal assistance has fact, receiving some 75,000,000 Swiss francs been given to exporters in some cases by the in October 1939 in connection with the reguaranteeing of exchange rates, as in Italy, payment of earlier loans. or by forward dealing in exchange rates for A further development has been the exlonger than the usual periods, as has been tensive declarations and mobilizations of forundertaken by the Sveriges Riksbank and eign securities undertaken by certain govthe Reserve Bank of India, while some form ernments. Formerly such operations were of insurance against war risks has usually confined in general to the so-called debtor been made available. countries. They have now been undertaken On clearing accounts also the general tend- by important creditor countries, such as Engency appears to have been toward a repay- land and France. As regards France, the ment of the outstanding balances or "Spit- obligation to declare assets held abroad has zen." The excess of German exports in the already been mentioned. In England the reglast months of 1939 toward Holland, Italy, istration of certain securities held by resi- Switzerland, Yugoslavia and other contigu- dents and payable in foreign currencies was ous countries brought a considerable repay- called for in September 1939, while restricment of Germany's clearing debts to export- tions were placed upon their transfer. In so ers in these countries. Hungary appears to far as sales to non-residents were permitted have played a leading part in various ar- the foreign exchange proceeds had to be surrangements for settling clearing balances by rendered against sterling under the foreign triangular arrangements. For example, exchange regulations. After registration Hungary, by ceding lira claims equivalent to two batches of specified dollar securities were about 25,000,000 dinars, was able to reduce requisitioned, the first of 60 stocks in Februits debt to Yugoslavia, which country was in- ary and the second of 117 stocks in April debted to Italy in respect of industrial deliv- 1940. These securities were purchased by eries. Arrears owing to Great Britain on its the U. K. Treasury through the Exchange clearings with Spain and Turkey were loos- Equalization Account, which at the outbreak ened by credits granted by the British Gov- of war was empowered to hold foreign secuernment. The fall of sterling brought some rities as well as gold and foreign balances, disturbance into the working of clearings be- and paid for in cash in sterling (which the tween foreign countries denominated in that Account raised by issues of Treasury bills). currency but, whereas the clearing between The total of the two requisitionings has been Norway and Spain, for example, was changed estimated at £75-100,000,000, giving an from sterling to Norwegian crowns, it was equivalent of dollar purchasing power to the decided to retain sterling settlements as the British Government while new investment basis for the Lithuanian clearings with Hun- funds were released in the British market. gary and Greece. Of a somewhat different nature was the requisitioning in October 1939 of the 3V^ per At long term new foreign lending has dried cent Canadian 1930-50 stock denominated in up except for a few favored borrowers. sterling, of which £28,000,000 was outstand- From England the chief overseas borrowers ing. English holders were repaid in sterling were South Africa, Australia and New Zeafor the securities which were transferred by land; there were no foreign issues. Public the British Government to the Canadian Govofferings in the United States were virtually ernment for Canadian dollars (obtained from confined to three Canadian issues, made in 1080 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports part of an internal Canadian issue). In this Europe long-term yields and with them shortway Canadian exchange was placed at the term rates generally rose in the first eight disposal of the British Government, whose months of the year, the movement becoming purchases in Canada during the first year of accentuated in the summer concurrently with war will amount, it is estimated, to the equiv- the increase of international tension and alent of £89,000,000. Towards the end of reaching its climax at the outbreak of war. 1939 registrations or mobilizations of foreign From this point extremely divergent trends securities were also made in Spain and in the are apparent. In the principal belligerent early part of 1940 in Sweden, Denmark and countries, Germany, France and the United Australia,. Kingdom, the shock to the markets soon Although for the time being conditions are passed and by the spring of 1940 the longlikely to remain unfavorable for foreign is- term yields on government securities were sues, it is not too early to consider under what as low as or lower than they had been a year circumstances and conditions foreign loans before. In Italy rates remained comparafor reconstruction after the war may be tively stable all through 1939, while in Switfloated. In this connection should be men- zerland, Belgium, Holland and Scandinavia tioned the report of the League of Nations the rise of long-term rates in the summer Committee for the Study of International continued in general until the end of the year Loan Contracts published last year. The and even beyond, so that the yields on govern- Committee, which was set up in 1935, had as ment securities, for example, were some one its object the examination of the means for to two per cent higher on the year. Outside improving contracts relating to international Europe the United States markets, under the loans which might be issued in the future. influence of incoming gold movements, pre- At the time when the Report was published sent a picture of liquidity such as has rarely in May 1939 it was estimated that, of the total or never been seen before. amount of outstanding external issues made "Cheap money" posed problems for the on the London market, the amount in default banks in other countries besides the United did not exceed 30 per cent and that a cor- States, but never in the same degree. The responding figure for dollar issues on the huge increase of deposits has raised expenses New York market was 40 per cent. There with little or no corresponding income, while were times in the past when the percentage it decreases the ratio of capital funds to total of default on loans issued was at least as high, liabilities and thus increases the banks' vulalthough the absolute amount at that time nerability to capital losses (although, on the was doubtless not so large. In the vast maother hand, the risk of loss is reduced by jority of cases the reason for the default is reason of the proportionately large holdings to be found in economic conditions and deof cash). Cash reserves earn nothing and faults have increased concurrently with atmoney employed in the market next to tempts made to restrict the movements of nothing—with little demand for business men and the flow of goods, the very basis of loans even at present low interest rates, the the exchange of capital. Defaults have rebanks have been virtually forced into the sulted in many cases from unilateral action by government bond market and questions of the debtor countries without consultation budget finance become of first importance to with the creditors. them. With regard to the future, the Committee Apart from the United States, France was suggested that to prevent a recurrence of the country where internal credit conditions these unfortunate results steps should be in 1939 were most influenced by incoming taken to secure a more coordinated examinacapital movements. The financial and ecotion of the economic possibilities of borrownomic recovery dating from November 1938 ing countries before new loans are granted, and the repatriation of capital which conand that such coordination might be achieved tinued without serious interruption throughthrough the cooperation of some recognized out 1939 were reflected in the condition of the international financial authority working money and capital markets, particularly in through small standing committees of finanthe first half of the year. The discount rate cial experts. of the Bank of France was reduced from 2\fa THE TREND OF INTEREST RATES to 2 per cent in January 1939, at which level The diverse movements of market rates in it has since remained unchanged. The aver- 1939 are both interesting and significant. In age rate for fortnightly loans against first- OCTOBER 1940 1081 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports class securities on the stock exchange (the 000 French francs corresponded to an exten- "reports au parquet" or "contango" rate) sion of the credit volume (public and private) was only one per cent in the first half of the of the Bank of France while the remainder year, while in the same period the yield on was generally a counterpart to the return of the 4 per cent rente of 1918 remained under capital funds from abroad acquired by the 5 per cent. The market was liquid, deposits French monetary authorities. Deposits in in the commercial banks increased and some the four large Paris banks, which hold some 4,000,000,000 French francs of discounts and half to two-thirds of the deposits of all the advances were repaid to the Bank of France. commercial banks, increased by some 9,000,- Government expenditure was covered by tax- 000,000 French francs on the year, notably ation and market borrowing: an issue of 5 from August, and continued to rise in the per cent 40-year rentes at 98 brought in 10,-new year, from 42,400,000,000 French francs 000,000,000 French francs (cash and con- in December, to the record figure of 46,600,version) in May, June and July (with no gold 000,000 French francs at the end of March or exchange guarantee) and no recourse was 1940. The turnover of accounts is, however, had to advances from the Bank of France. sluggish judging by the volume of bank clear- This picture was abruptly changed in the ings in Paris, which from September to the middle of August, when the growth of polit- end of the year was barely half that of the ical tension and the outbreak of war led to previous year. heavy demands on the Bank of France, as The pressure of August-September was the following table shows: thus temporary—-the money market soon became easier and bank deposits increased; the contango rate on the stock exchange again BANK OF FRANCE—TOTAL CREDIT GRANTED fell below one per cent. War financing, as in [In billions of French francs] other countries, was met in the first place by short-term borrowing. 1938 1939 1940 The rente market recovered in September without help from the Rente Fund (originally Dec. 29 Aug. 17 Sept. 7 Dec. 28 Mar. 28 formed to support the prices of government Private credit: securities) and early in 1940 the yield of the Discounts 9.7 6.0 20.1 7.5 6.9 4 per cent rente of 1918 again fell to around Advances 4.1 3.8 6.2 3.7 3.7 5 per cent, but no long-term government issue Total 13.8 9.8 26.3 11.2 10.6 Public credit: has yet been made on the market. The volume Advances to govt 30.6 30.6 30.6 44.7 *47.8 of borrowing envisaged is considerable, rep- Total . _ 44.4 40.4 56.8 55.9 58.4 resenting an annual rate of some 220,000,- Open market purchases 1.9 2.9 4.3 5.8 7.2 000,000 French francs, compared with a total Total of above items 46.3 43.3 61.2 61.7 65.6 public debt before the present war of 450,- Note circulation 110.9 123.1 146.1 151.3 156.0 000,000,000 French francs. Owing to the depreciation of the franc, however, the gold * Including 17,300,000,000 French francs from the gold revaluation profit in March 1940. value of the public debt in 1939 was not higher than it was in 1914. From the middle of August the commercial Contrary, and to some extent complemenbanks, in order to meet the demand for notes, tary, to the situation in France, there was a were obliged to apply for discounts and ad-further outflow of funds from England in the vances at the Bank of France; but from Sep- first eight months of 1939. Although the tember 7 already some reflux occurred, the operations of the Exchange Equilization banks were in a position to begin repayment Account tended to protect the short-term of the accommodation thus obtained and at market, the scarcity of "outside money" the end of the year the total volume of private (i. e. money lent to the discount market by credit outstanding was less than at the end other than clearing banks) made itself felt. of 1938. On the other hand the government, The liquid funds of foreign banks, already from the middle of September, drew on its reduced in volume, when not simply transadvance account at the Bank of France in ferred abroad were more profitably employed roughly the same rhythm as that assumed in dollar swaps and gold arbitrage than on by the repayment of private credit. In 1939the money market. The Treasury-bill rate, the note circulation rose by about 40,000,- however, remained at little over V2 per cent 000,000 French francs, of which 15,000,000,- until the middle of March, from which time, 1082 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports under the influence of the international tions of early September soon passed. Bank situation (and with the possibility that the rate was reduced to 3 per cent on September 2 per cent bank rate would become effective 28 and again to 2 per cent on October 26. or even be increased), the rate rose to l1/^ Market rates tended to anticipate and preper cent in the middle of April, falling again cede bank rate on the downward tack. A to % per cent early in May. notable exception was the clearing banks' By and large, long-term interest rates in rate for loans to the market, which mainthese first eight months of 1939 continued the tained its traditional relationship of one per upward trend which was taking government cent below bank rate and thus reached its low bond yields from under 3 per cent in 1935-36 level of one percent in October (compared towards 4 per cent. with i/2 Per cent, i. e. 1% per cent below Although these conditions were not very bank rate, which had ruled in the exceptional propitious for the new capital market, almost period from the end of 1934 to August 1939). all issues during the year were made in the As short loans at this rate from the clearing first eight months: new domestic industrial banks constitute the principal resources of issues according to the Bank of England's the discount market, the Treasury-bill rate compilation totalled only £39,000,000, about returned to a level slightly over one per cent. one-half of the figure for 1938 and less than With the growth of the Empire countries' a quarter of that for 1936. sterling reserves, "outside money" became In August 1939, as the international situ- more plentiful. Aided by the reduction of ation became more threatening, the efflux of bank rate and the increasing liquidity of the capital increased in intensity. On the 24th, market, gilt-edged stocks floated clear of the the day before sterling fell on the exchanges, minimum prices early in October and dealing, bank rate was raised from 2 to 4 per cent, which had been very difficult, became more thus abruptly terminating the unbroken normal. period of seven years during which 2 per Increased government expenditure, due to cent had been in force. The new rate was the war, was financed, as in other countries, immediately effective, the clearing banks' by short-term issues in the first place and the lending and deposit rates, Treasury-bill and Treasury bills offered for tender mounted other market rates all falling into line. The from the usual £30-40,000,000 to £55-65,000,slump in prices of gilt-edged securities was 000 weekly. In November an attempt was checked by the introduction of minimum made to attract small savings with the issue prices (corresponding approximately to the of 5 to 10-year savings certificates and 7-year lowest prices on August 23), below which it savings bonds, each giving a yield of about was prohibited to deal—the price of 88^ 3% per cent. (Up to the end of March 1940, was fixed for Z1/^ per cent War Loan. Fort-£120,000,000 of these savings issues had been nightly settlements on the stock exchange subscribed, an average of about £1,000,000 were abolished, and all dealing was made per Working day.) strictly for cash. The market remained liquid over the end On the outbreak of war in September a of the year, no recourse being had to the number of emergency measures were taken: Bank of England. A new technique of openforeign exchange regulations, capital market market operations was developed during the and other controls were imposed. Excep- year, first in April 1939 and on a larger scale tional discount facilities at the Bank of Eng- in December. The Bank of England made an land (at 2 per cent above bank rate) were important departure from precedent in buymade available for market acceptors whose ing considerable amounts of shortly-maturing clients, on account of war conditions, failed Treasury bills direct from the clearing banks, to remit amounts due. Although the problem which replenished their portfolios by purpresented to acceptors by the war was slight chasing longer bills from the market. The compared with that in August 1914, it was liquidity of the original ten clearing banks at complicated by the existence of about £37,- the end of 1939 is shown by the fact that the 000,000 German standstill credits still out- increase of aggregate deposits by £163,000,standing (some 60 per cent of which had, 000 to £2,350,000,000 during the year was however, been taken off the market well covered as to over 80 per cent by an increase before the outbreak of war). of liquid assets (cash, call money and bills With the market protected against an out- discounted). Almost the whole of the inflow of domestic capital, the strained condi- crease of deposits and liquid assets took place OCTOBER 1940 1083 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports during the last four months of the year and per cent (or under 2 per cent to the investor reflects the rise of government expenditure after deduction of income tax). covered by Treasury bills; the volume of Being protected by stringent exchange "tender" bills outstanding rose from £500,- regulations, the German money and capital 000,000 in the middle of September to over markets are unaffected by international £800,000,000 in January 1940. The increase movements of funds but reflect the changing of deposits at the ten clearing banks was conditions of the domestic situation, espegreater in 1939 than in any year since 1932. cially changes in the volume and methods of The growing volume of money accumu- government financing and in the business lating in savings banks, insurance companies demand for capital. and certain extra-budgetary funds exerted its Until March 1938 German Government influence on the stock exchange in the almost expenditure was met partly by the issue of total absence of new capital issues, and gilt- "special" bills which did not bear the name edged prices rose in a lively market. In the of the Reich and were excluded from the second half of January 1940 the conversion official statistics. As no further "special" of 4*/2 per cent Conversion Loan 1940-44 (of bills were issued after April 1, 1938, the which a large part was held by banks and monthly statements of the public debt, summarket houses) into a 2 per cent 3 to 5-year marized below, may be taken to give a picture loan was announced and £250,000,000 of the of the current receipts from government bor- £350,000,000 outstanding was converted. rowing (certain issues which produce no But no "new money" was called for. On the cash receipts, such as those made to comcontrary, towards the end of January a tem- pensate German holders of Austrian and porary ban was placed on municipal conver- Czecho-Slovakian government securities besion offers "involving cash borrowing." ing omitted.) Further, a series of U. S. dollar securities The Finance Plan of March 1938 aimed at were mobilized, payment being made to hold- covering Reich expenditure in excess of curers in sterling early in March. By this time rent tax revenue by means of long-term the weight of money had pushed long-term loans; but some elasticity was given to the SY2 per cent stocks nearly to par and middle-system by the issue of six-months' "delivery" term issues were yielding around 3 per cent. bills in so far as they might be repaid on On March 5, 1940, a £300,000,000 3 per maturity. Long-term loans comprise the cent 15 to 19-year War Loan was announced market issues of Treasury bonds and the so- —to be issued at par on March 12. The called "liquidity" loans, 27-year bonds on tap £300,000,000 new long-term money received directly to savings banks, insurance comcorresponded approximately to the increase panies and social funds for the employment in the issue of "tender" Treasury bills since of their liquid resources. The monthly inthe outbreak of war and was sufficient to crease of these loans reflects the growth of cover requirements for three or four months savings accumulating in savings deposits, at the current rate of spending. payments of life assurance premiums, etc. Total government expenditures in England "Delivery" bills wer6 issued from April increased from an average of £250,000,000 1938 at an average of RM 500,000,000 a a quarter in 1938 to £625,000,000 in the first a month and by October the total outstanding quarter of 1940, that is from £2,750,000 to amounted to about RM 3,000,000,000 (held nearly £7,000,000 a day. principally by the banks). The first bills After the issue of the 3 per cent War Loan, matured and were repaid in November 1938 the Chancellor of the Exchequer stated that but further bills were issued until April 1939. "the policy of the Government is to aim at The circulation of "delivery" bills was restability of interest rates and to secure that duced month by month on maturity until in the yields offered on future loans, whatever October 1939 the issue had been entirely retheir type, shall . .. be in agreement with paid. Treasury-bill issues began to be of imthe level of interest rates established by the portance from the end of 1938. terms of the recent 2 per cent Conversion In the fiscal year ending March 1939 long- Loan and of the 3 per cent Loan just issued." term market loans were issued to a total of On March 18, 1940, a new list of minimum RM 5,400,000,000, while a further RM 1,900,prices for gilt-edged stocks was published. 000,000 was obtained from the "liquidity" The minimum for the new 3 per cent loan was loans, so that long-term borrowing (less fixed at 98, giving a maximum yield of 3.14 amortizations of RM 800,000,000) gave a net 1084 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports amount of RM 6,500,000,000, being about But the certificates proved difficult to digest 60 per cent of the RM 10,700,000,000 newin large amounts, for, although quoted on the money raised by government borrowing in bourse, they were not rediscountable and the period. might not serve as cover for bank loans. REICH INTERNAL DEBT—MONTHLY INCREASES OR DECREASES (—) * [In millions of Reichsmarks] . Short-term Long-term Tax Sundry certifi- Grand Year and month R b e a ic n h k s- Tr b e i a ll s s ury s t h e o rm rt- Total R b e a n n te k n- M is a s r u k e e s t u " id L i i t q y - " t N ot e a t l cates total etc. loans loans 0) () ) (0 (10) 1938: April —60 246 186 1,337 210 1,528 1,714 May 5 483 262 148 376 864 June —19 502 367 37 289 772 July 18 468 486 10 A 482 August 18 506 524 299 299 823 September.. 240 240 96 —173 67 October —49 186 137 1,840 55 1,784 1,921 November.. 37 —213 —176 7 157 164 —12 December.. 53 236 299 1,171 153 1,223 1,522 January.... 242 20 262 330 362 687 949 February... 650 —10 640 2 328 330 970 March. —73 714 —20 621 100 58 2 623 April 73 994 240 1,307 10 —25 1,282 May _. 189 365 554 144 136 1,359 June —92 —325 —417 811 676 1,088 July 454 —215 —281 —42 11 11 781 750 August 126 1,023 1,149 13 13 845 2,007 September- -461 1,320 859 400 229 528 905 2,292 October 324 784 1,108 161 320 481 803 2,392 November.. -243 1,791 1,548 58 404 462 2,010 December.. 1, 053 1,539 55 358 312 —161 1,690 * Only the "new" internal debt is taken into account, i. e. that contracted since 1924. 1 Working credit, the RM 100,000,000 limit of which was removed in June 1939. 2 Including certain other short-term financing, in particular the six-months "delivery" bills issued from April 1938 to April 1939 and completely repaid by October 1939. 3 In April and May 1939 a special "over-bridging" credit from the banks. 6 Loan to Reich corresponding to issue of Rentenmark notes to supplement the coin circulation. • No market issues were made in 1939, the amounts shown in the first quarter being delayed subscriptions to the loan of December 1938. 7 Issues made directly to employ the liquid resources of savings banks, insurance companies, social funds, etc.—given net, i. e. with current amortizations deducted. 8 Total of long-term loans less sundry amortizations. 9 Utilized for payments in accordance with the New Finance Plan of March 1939—not, therefore, wholly cash receipts but supplementing general revenue. The Finance Plan of March 1939 provided Their issue was discontinued in November that up to 40 per cent of the amount of official and about half of the 7-months' issue of May contracts might be paid in equal proportions was presented for payment of taxes in Deof 7 and 37-months' "tax certificates" which cember 1939. From April 1, 1940, "tax certo a limited extent had the status of legal tificates" were deprived of their qualities as tender and, on maturity, could, with varying means of payment. advantages for individual firms, be utilized In the nine months April to December 1939 for the payment of taxes or could be held for the total borrowing of the Reich was longer periods as an investment. Expendi- RM 14,900,000,000 (including a net issue of ture was to be met in this manner and not by RM 4,700,000,000 tax certificates) compared long-term market loans. The capital market, with RM 8,200,000,000 in the same period of which for years had been reserved for Reich 1938: no long-term market issues were made, loans, was opened particularly for industrial but the long-term "liquidity" loans produced bond issues. RM 2,300,000,000 against RM 1,200,000,000 "Tax certificates" were issued from May in the last nine months of 1938. Net long 1939 at an average of RM 800,000,000 a and medium-term borrowing, including month and by the end of October the total RM 670,000,000 from the Rentenbank to supoutstanding amounted to RM 4,800,000,000. plement the coinage and RM 2,400,000.000 OCTOBER 1940 1085 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports three-year tax certificates, amounted to From an average of RM 2,700,000,000 a RM 5,000,000,000 in the last nine months month in the first half of 1939 the actual of 1939, i. e. slightly over one-third of the monthly figures of total receipts rose to new money raised by Reich borrowing. The RM 3,750,000,000 in August and RM 5,000,higher proportion of short-term borrowing 000,000 in September, declining in the folin the period is mainly due to the expansion lowing months. In the five months of heavy of the Treasury-bill issue between August borrowing from August to December 1939 and November 1939 when total borrowing total expenditure would appear to have been exceeded RM 2,000,000,000 a month. Mention covered as to 50 per cent from taxation. should also be made of an "over-bridging" The issue of rediscountable Treasury bills credit of RM 600,000,000 obtained from the in the early months of 1939 again loosened up banks and utilized in April and May 1939. the market and on May 2 the private dis- This credit was repaid in June and July, count rate was reduced by % to 2% per cent. when the removal of the previous limit of The new financing by tax certificates from RM 100,000,000 on direct advances from the May onwards, however, had the effect of Reichsbank enabled fuller recourse to be had shifting the provision of funds for governto ways and means advances. By December ment orders on to industrial concerns, thus 1939 the total of these advances was inciting a further demand for bank advances RM 785,000,000. while checking an increase of deposits. Fur- It is probable that the rise in monthly ex- ther, the demand for bank-notes on the outpenditure was roughly parallel to the total break of war, which provoked an increase in receipts from borrowing and from taxation. the Reichsbank circulation from RM 8,710,- To give a broader picture the following graph 000,000 to RM 10,970,000,000 in the two has been drawn up, based on a three-months' weeks to September 7, added to the strinmoving average of the monthly data (the gency. These conditions, which continued quarterly figures for taxation published in into October, also affected the bond and share the last half of 1939 being first placed on a markets. monthly basis in the light of experience of Prices of industrial bonds fell to their lowthe movement of the monthly statistics in est point early in September, while to mainrecent years). tain quotations of government securities the Reichsbank bought RM 100,000,000 in Au- REICH INCOME FROM TAXATION AND BORROWING gust, RM 400,000,000 in September and a MONTHLY further RM 100,000,000 in October. Reich [ In millions of RM ] 41/2 per cent Treasury bonds were rigidly 5000 held slightly below par, but the three-year tax certificates fell to a point where the effective 4500 yield rose above 6 per cent. Conditions changed rapidly in November, when a policy - WOO of credit expansion was adopted. On the bond market the Reichsbank, to meet the 3500 3500 growing demand, sold RM 440,000,000 of the securities it had previously bought. The issue of Treasury bills became the principal 3000 3000 method of government financing and increasingly liquid conditions have characterized 2500 2500 the market up to date. Deposits in the banks rose rapidly and two further reductions of 2000 the private discount rate to 2% per cent were made. By January the Reichsbank had sold 1500 in all over RM 1,000,000,000 securities since the last week of October, in February the 1000 market quotations of Reich bonds advanced to par and in March 1940 a new series of 4 per cent Reich Treasury certificates of about 5 years' maturity were put on the market at 99 to meet the intense demand for investment material. In May, quotations reached par. 1086 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports Although it was the declared policy to open the general economy of the country. Later in the capital market for industrial bonds in the month the Central Credit Committee 1939, conditions in the first ten months of representing the Reich groups of credit inthe year were not propitious for new loans stitutions announced general reductions of But from November industrial issues became interest rates as from May 1, 1940. On the possible in favorable conditions. The first one hand the rate for advances was lowered loan of importance was the issue of RM 500,- from 5 to 4^ per cent, while on the other 000,000 4i/ per cent certificates (1945-49) hand interest on ordinary savings deposits 2 by the German Railway Company, of which was reduced by i/ to 21/2 per cent and on 2 RM 300,000,000 were offered to the public longer-term savings deposits by % to 3% at 98% early in November 1939. In the last per cent. quarter of 1939 issues of industrial bonds In 1939 there was in fact very little movement in short-term rates in Switzerland: bank rate, at 1% per cent since November GERMAN STOCK EXCHANGE INDEXES 1936, remained unchanged throughout the [In percentage of nominal value for shares: quotation 1924-26] year, while the private discount rate was ad- 120 V justed only from 1 to 1^4 per cent in September. The money market, indeed, re- / mained fairly liquid, especially after the turn 115 / 115 of the year when a considerable reflux of tan incex notes took place. 110 / 110 The change of conditions in 1939 was re- - flected more in the long than in the shortterm market. The average yield of the twelve 1 105 105 Confederation and Railway bonds rose from :: J V trial nds - 3 to 3i/2 per cent in the spring of 1939 and, A after touching 4i/ per cent in the autumn, / 2 100 100 finished the year at 41/4. The costs of mobilf^ i i % Securities ization and other extraordinary military outlay have been estimated at about 2,500,000,- M A J 000 Swiss francs from the outbreak of war 1939 1940 to June 1940, partly covered by the imposi- Source: German Institute for Business Research. tion of new taxes and an increase in the rate of some old extraordinary taxes. totalled RM 130,000,000 (in addition to the The increase in the long-term rate is of railway loan), while further issues in Januparticular importance in Switzerland, in the ary, February and March 1940 brought the first place because an appreciable part of the total to over RM 900,000,000 in the twelve banks' resources are obtained by the issue of months since April 1939. By comparison it 3 to 5-year bonds in the nature of fixed time may be recalled that the total industrial bond deposits. Secondly, the high volume of issues in 1938 barely exceeded RM 100,mortgage indebtedness in the country makes 000,000. In May 1940 RM 500,000,000 4 per the interest rate on this form of borrowing cent bonds were issued by the Prussian State, an important factor in the Swiss economy. of which RM 250,000,000 represented new During the year this rate also rose from about money. 3 to around 3% per cent. The liquidity of the money market continued in the spring of 1940 and on April 9 Long and short-term interest rates in Holthe Reichsbank lowered its official discount land fell with few interruptions from 1932, rate from 4 to 3V2 per cent—the first change the cheap money movement being intensified for eight years. Commenting on this reduc- after the devaluation of the florin in 1936 and tion of rate, the President of the Reichsbank reaching, as in Switzerland, its climax in at the Annual General Meeting said that it 1938, when the total deposits at the Nederwas to be looked upon as only the first step andsche Bank, a good indication of the liquidtowards a systematic cheap-money policy to ity of the market, reached Fl. 1,000,000,000 lighten the burden of war financing, in theand exceeded the volume of the note issue. first place for the Reich and in due course for Bank rate at 2 per cent was applied from the OCTOBER 1940 1087 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports end of 1936, but the private discount rate issued in order to consolidate part of the floatcontinued to fall to an average of only 0.2 ing debt. The amount subscribed by the per cent in 1938, at which time the "pro- public was less than Fl. 100,000,000. longatie" rate (for one-month loans on the In February 1940 a further 4 per cent 40stock exchange) was 0.5 per cent and the year loan for Fl. 300,000,000 was issued. yield of the irredeemable government rente These bonds could not be utilized at par for was just 3 per cent. This period of extremely tax payments, but, in conformity with the cheap money was utilized by the government methods used during the war of 1914-18 for to reduce the interest paid on the funded debt. the raising of government loans, the Bill au- While in 1929 sixty per cent of the funded thorizing the issue provided for a compulsory debt bore interest at 4.4 per cent or more, loan at 3 per cent if the voluntary loan were nearly the whole of this debt had been con- not subscribed. This loan was fully successverted to a 3 per cent basis by the end of 1938. ful, being entirely taken up by the public. The money market was quiet in the first The revaluation of the Nederlandsche seven months of 1939, except for some mild Bank's gold holding at the end of March 1940 tension in March and April, which momen- gave the government a profit of Fl. 132,000,tarily brought the private discount rate at 000 to be credited to the Loan Fund, from 1% per cent within range of bank rate. But which part of the costs of mobilization were there was some efflux of capital, which had defrayed. its clearest expression in the gradual fall of The Belgian money and capital markets exthe "other" deposits a,t the Nederlandsche perienced somewhat disturbed conditions in Bank (comprising principally the cash re- 1939—the efflux of capital in the spring, the serves of the commercial banks) from over continued losses of deposits by the commer- Fl. 600,000,000 early in the year to around cial banks and the failures in the autumn, the Fl. 350,000,000 in July, while the yield of the emergency government financing and the irredeemable rente rose quietly to 3V2 Per heavy decline of the government rente. cent. The failure of the Mendelssohn Bank in On August 11 the failure of the Mendels- Amsterdam precipitated the closing of the sohn Bank with wide connections in Holland Caisse Generate de Reports et des Depots of and other countries came as a shock to the Brussels in November and of the Credit Anmarkets. In response to a tightening of versois early in December. The former was money the Nederlandsche Bank raised its rate reorganized without loss to the depositors by from 2 to 3 per cent on August 29. The a banking consortium, but the latter had to Mendelssohn failure and the outbreak of war liquidate with payments at various rates to put a certain pressure on the central bank, its depositors. evidenced by expansion of the note issue to For the Northern countries the transition its highest point at Fl. 1,200,000,000 on Sep- from peace to war conditions in Europe led to tember 4, and increases in discounts and more abrupt changes on the money and capiadvances. The following weeks brought some tal markets than almost anywhere else. The relaxation of the strain. central bank in Sweden came under pressure Meanwhile the position of the Treasury from three directions, from the banks as a had been growing tighter. The Treasury consequence of demands for liquidity by the started to issue Treasury bills on the market public, from the Treasury to meet extraordiin May, but by August had fully utilized its nary expenditure, and on foreign account redeposit and was forced to borrow from the flecting an efflux of capital, an increased Nederlandsche Bank. import surplus and changed conditions of Costs of mobilization, estimated at Fl. 1,- foreign trade involving higher cash payments 700,000 a day, and other exceptional charges in foreign currencies. abruptly raised total government expendi- The pressure on the Riksbank may be ture—which would appear to have been cov- measured by the loss of external resources ered to the extent of about 50 per cent by plus the expansion of the note circulation. the proceeds of taxation. The deficit was met The chart on the following page shows graphlargely by Treasury-bill issues which found ically the abruptness in the change of the a ready market with the banks, particularly Riksbank's position from the summer of 1939. after September, owing partly to the liquida- On the conclusion of the civil war in Spain tion of sterling balances. In December a 4 a period of reconstruction was inaugurated. per cent 40-year loan for Fl. 300,000,000 was The 5 per cent bank rate, in force without 1C88 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports change since 1899, had been lowered to 4 In October 1939 the Canadian Government per cent in Burgos on November 27, 1938ssued $200,000,000 2 per cent 2-year notes to and a similar reduction was made in Madrid the chartered banks, of which $90,000,000 on October 14, 1939. Two 3 per cent three- was for the purpose of taking up and retiring year reconstruction loans have been issued, anadian issues in the United Kingdom. for Pesetas 2,000,000,000 in October 1939 The first public war loan of $200,000,000 3^4 and for Pesetas 2,500,000,000 in April 1940. per cent 12-year bonds was issued in February 1940 and oversubscribed by fifty per cent. The fall of bond prices on the outbreak SVERIGES RlKSBANK RETURN of war had only partially been recovered by [In millions of Swedish kronor] December and yields on long-term govern- 2200 2200 ment bonds were about *4 per cent higher on the year. 2000 2000 For a year and more before the war the liquidity of the trading banks in Australia 1800 alued) 1800 declined as primary producers made additional calls on bank credit, and interest rates 1600 1600 had been rising in spite of intervention by the Commonwealth Bank, which acquired 1400 1400 considerable amounts of government securities. Capital-market regulations have been 1200 1200 Notes in Circulation in force since the outbreak of war and in its Directors' Report in December 1939 the 1000 1000 Board of the Commonwealth Bank expressed \t- the belief that "it is desirable to keep rates of 800 800 interest as low as possible/' adding "The maintenance of low rates of interest, how- 600 600 ever, depends on a number of factors of which central bank action is only one. An excessive 400 400 rise in prices, for example, might make it Total int impossible to keep interest rates low." So 200 200 of which ., far no such rise had taken place in Australia. to Banks/ I , , i The direct advances of the Reserve Bank 0 1938 1939 194-0 to the government which had risen to £N.Z. 17,500,000 at the end of 1938 (against £N.Z. In the British Empire the common factor 7,100,000 at the end of 1937) continued to has been the necessity for increased govern- rise in 1939 to £N.Z. 20,000,000 in March. ment borrowing to meet war expenditure, But, with the export of capital prohibited, generally facilitated, since the introduction the market became easier and long-term rates of foreign exchange restrictions in Septem- declined partly under the influence of purber 1939, by some decline of long-term chases of government securities by the interest rates. trading banks. The South African budget has given sur- Persistent monthly issues of government pluses in recent years but the outbreak of bonds for rising amounts have, after two war caused an expansion of expenditure. and a half years, produced some fatigue on Although no war loan has yet been issued the market in Japan, and recently assimilaadvantage was taken of the low level of rul- tion of the bonds has proved more difficult. ing interest rates to convert on February 1, In round figures the monthly issues since 1940, the first option date, the £14,000,000 the beginning of hostilities in China in the 5 per cent 1940-50 loan to a ten-year loan middle of 1937 have been as shown on the on a 3% per cent basis. The Finance Min- table on the following page. ister requested the co-operation of financial While the external debt has remained pracinstitutions in maintaining a cheap-money tically unchanged—falling slightly with the policy. Since the outbreak of war the cash regular amortization to its booked amount of balance of the Treasury has been high and no Yen 1,267,000,000 at the end of 1939—the recourse has been had to the Reserve Bank internal bonded debt has more than doubled for advances or loans. from Yen 9,270,000,000 in July 1937 to Yen 1089 OCTOBER 1940 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws ami Reports Japan has, however, had to take up increasing JAPANESE GOVERNMENT BOND ISSUES amounts of the bonds issued; the three-years' [In millions of yen] increase in its government bond holding, Yen Month 1937 1938 1939 1,588,000,000, is paralleled by the increase of the note issue in the same period by Yen January 300 400 1,813,000,000 to Yen 3,679,000,000. The February... 300 300 March 185 330 430 sharply increasing price level is doubtless April 200 300 one of the causes of the rising cost of the war. May 300 400 June 400 400 The total budget expenditure has more than July 300 400 August 200 400 500 doubled and is now over Yen 10,000,000,000 a September. 400 500 year, i.e. greater than the total internal debt October 300 700 600 November _ 200 400 in the summer of 1937. December.. 600 700 Notwithstanding the increase in the gov- Total issues for year.. 1,485 4,330 5, 290 ernment debt, the yield of government bonds has fallen over the past three years from 4.0 20,250,000,000 at the end of 1939 in spite of to 3.8 per cent and at the same time the increases of taxation in each fiscal year. market has been open to other issues. Government issues are made through the Perhaps the most striking feature of the Bank of Japan, which has been able to place experience of the past year on the world's the greater part of the issues with other banks credit and capital markets as a whole has and institutional investors. At the end ofbeen the extraordinarily efficient working 1939 these banks, savings banks, trust and of the internal liquidity mechanism in the insurance companies held over three-quarters face of most difficult conditions. In August of the total internal bonded debt. The Bank of 1914 the mechanism temporarily broke down OFFICIAL DISCOUNT RATES OF CERTAIN CENTRAL BANKS 1914-15 AND 1939-40. 1914-15 Belgium England France Germany Holland Italy Sweden Sw la i n tz d er- U. S. A. Rates prevailing 1914, July 28 4 3 4 5 4^ 3M Changes made 1914: July 29 July 30 5 4 July 31 _ 6 8 5 PA 5>| Aug. 1 10 6 6 6 6 Aug. 3 7 6 Aug. 6 __ . _ _ 6 Aug. 8 5 Aug. 17 6 Aug. 20 5 5 Aug. 27 5 Aug. 28 . . 6 Sept. 10 5 Nov. 9 5H Nov. 16 _ *6 Dec. 23 5 5 Changes made 1915: Jan. 1 Jan. 7 . Feb. 3 Feb. 18 4 Rates in effect 1915, March 31 5 5 5 5 5 &A 4H 4 1939-40 Rates prevailing 1939, Aug. 23 2 2 4 2 4H 2V2 IX 1 Changes made 1939: Aug. 24 4 Aug. 29 3 Sept. 28 . _ 3 Oct. 26 2 Dec. 15 3 C hanges made 1940: Jan. 25 2 April 9 _ VA Rates in effect 1940, April 30 2 2 2 VA 3 4H 3 IX 1 " Rate quoted on opening of Federal Reserve Bank of New York for 60 to 90-day paper. 1090 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports when the first shock came: bank rates rose modern tendency towards markets closed up to 6-10 per cent, general moratoria were against outside influences by foreign exproclaimed, stock exchanges closed for change restrictions. months and some of the most liquid assets The outbreak of war caused less disturbwere frozen up. The contrast with 1939 is ance on the money and capital markets in remarkable as far as domestic markets are 1939 than in 1914, partly because the banks concerned—few movements of bank rate, and other credit institutions were more prea few unimportant restrictions on the with- pared for it, particularly after the rehearsal drawal of bank deposits and modifications in September 1938, but also because the old of conditions of payment for mobilized men, conception of liquidity has changed. Up to stock exchanges open almost without inter- the time when the Federal Reserve System ruption and few claims to liquidity which was founded in 1914 it was considered that could not readily be met. central bank credit should be based essenti- The table on page 1090 gives a review of ally upon the rediscount of commercial bills bank rate changes in 1914-15 and 1939-40 which were "self-liquidating" (by the sale of for nine central banks. the goods they represented at or before ma- In some measure the movement of interest turity)—a system most advantageous from rates in 1914 was no doubt dependent on the a monetary and other points of view, as long long-term upward trend since the beginning as sufficient material of the kind demanded of the century. Immediately upon the out- was available in the markets. But changes in break of war central bank rates were raised the financing of trade have led to the virtual from 3-5 per cent in July to 6-10 per cent disappearance of the commercial bill in many early in August. After eight months of countries and the classic conception of liquidwar the general level of 5 per cent had been ity has been found inadequate in modern conreached in Europe, which by and large re- ditions. In the United States the theory of mained in force as a minimum during the "shiftability" was developed—any assets for next four or five years. None of the eight which there was a high degree of market- European rates was reduced below 4*/2 P^r ability were considered liquid—while the evocent during the war and this rate was quoted lution of the American banking law and only in Holland and Switzerland. Federal Reserve policy has been towards in- In August 1939 six of the European rates creased emphasis on "sound" business rather were between l1/^ and 2^ per cent inclusive, than "liquidity" as expressed by the form of one was at 4 and one at 4^ per cent. Only the contract or instrument or by maturity the Bank of England and the Nederlandsche date. There is, in fact, a parallel evolution in Bank raised their rates when war was im- many European countries although often minent, followed by the Sveriges Riksbank more or less disguised by the erection of in December. (If, besides the countries some special institution between the central shown in the table, the whole of Europe be bank and the primary borrower. Thus almost considered, the increases in Norway and everywhere the basis of central-bank credit Denmark in September should be added.) has been widened, at any rate as regards The Bank of England soon returned to its short-term transactions. earlier rate while rates in Belgium and Ger- As regards the long-term markets, repremany were reduced in 1940. After eight sented particularly by stock exchange busimonths of war two of the eight European ness in government bonds, no uniform techrates were higher and two lower on balance, nique has been evolved, although stock exwhile the range of rates 11/2-4V2 Per cent changes, with few exceptions, have been kept was the same as before the war. open throughout the worst crises. Generally Two things are striking about the table— central banks have assumed some responsithe relative lack of disturbance in 1939-40 bility for the orderly conduct of the bond compared with 1914-15 (seven changes for markets, but in view of the volume of transeight European banks in eight months against actions and the possibilities of severe capital thirty changes) and the relatively low rates losses have rightly shown themselves anxious in force after eight months of war (a range not to become the "shifter of last resort." of 1V2-4V2 Per cent against 4-^-5^ per cent). The Federal Reserve Banks have openly ac- The low rates are the resultant of a number cepted some responsibility for "maintaining of forces reflecting the recent trend towards orderly market conditions" and by co-ordia reduced level of interest payments and the nated purchases steadied the government OCTOBER 1940 1091 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports bond market at a time of severe pressure. distribution and consumption in times of The Reichsbank and the National Bank of modern warfare have necessarily had a direct Belgium have also supported the government influence on the activities of central banks— bond market, while the Banco Central in the the ultimate source of liquidity in credit sys- Argentine did the same for account of the tems. Important changes have taken place in Ministry of Finance. Experience of official the past year in central banking statutes and intervention of this nature in the past points practices, related to three main developto the conclusion that, so long as the opera- ments : tions are conceived as temporary measures (i) the intense demand for internal liquidto meet some emergency, they may prove ity, which had already arisen tempoeffective in maintaining orderly conditions rarily in September 1938, was renewed and beneficial as a rallying-point to steady the market. But official intervention to peg and accentuated in the latter half of particular prices, especially if this be against 1939; the long-term trend, may be very costly and (ii) the enormous cost of armaments, mobialso lead to a distortion of the whole credit lization and actual warfare gave rise to structure. an urgent demand for extraordinary state financing, only to be fully satisfied As a contrast to direct or indirect use of in many cases by direct resort to cencentral-bank credit to support the governtral bank credit; ment bond market, mention may be made of (111) increased imports and other expendithe technique of "minimum prices" for stock ture abroad made serious inroads into exchange dealings introduced in England and official reserves of gold and foreign ex- Sweden. Under this system dealings tend to change. dry up when the minimum is reached, but persons requiring cash against their bonds With the growth of international tension can generally borrow against them from the in the summer of 1939 leading up to the outcommercial banks, if their need be urgent break of war, the demand for currency by enough. In Sweden several adjustments were the public increased in a measure never bemade in the minimum prices by the Stock Exfore experienced. The note circulation in all change Committee: in England the market European countries and in many countries floated off the minimum prices after a few overseas rose to record figures. Some new weeks at the beginning of the war and the hoarding of foreign bank-notes occurred, parminima were readjusted upwards to a little ticularly of Swiss francs and dollars, but the below the new quotations. Other measures amounts involved were not so important as such as legal authority to carry government other forms of hoarding. Furthermore, in bonds at par for balance-sheet purposes are those countries where the population was used in the United States to check indiscrimimobilized cash requirements increased with nate selling. Some of these interventions are the rise in government payments, and also on probably temporary expedients, but others account of partial evacuations and voluntary seem to be in line with a more permanent withdrawals from closely-settled areas, which, development. besides involving extra outlay, took indi- The first shock of the outbreak of hostilividuals and firms from their usual banking ties was thus generally overcome with relaconnections. The advance in retail prices in tively little disturbance. So far government Europe generally may also have contributed borrowing to defray the immense costs of a to a certain expansion of the note circulation. modern war or to meet heavy mobilization In the case of the United States and Canada expenses in neutral countries has mostly had some part of the increase in note circulation the character of emergency financing. There during the latter half of 1939 was no doubt has not, as a rule, been time to frame longdue to the rise in industrial activity and the term programs, just as it cannot yet be growth in consumers' income. told what may be the eventual effects on currency and credit conditions of heavy govern- Notes which are hoarded do not for the ment borrowing over a protracted period. time being enter into active circulation; this explains why the sudden upward leaps in the volume of notes, especially in the autumn of CENTRAL BANKING DEVELOPMENTS 1939, have of themselves had little effect on The immense financial requirements of the the actual demand for goods and services. State and the violent changes in production, As long as confidence in the stability of a cur- 1092 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports rency remains—and an increased hoarding year, while the note issue rose by 309,000,000 of notes ought to be a sign of such confidence Swiss francs over the same period. In the —there is no reason to fear an inflationary same way the expansion in the Federal Reeffect as a result of hoarding, which, in a serve note circulation in the United States certain degree, may even be an expression of was easily effected out of the excess reserves current savings. Should panic-scale buying of the banking system. set in, however, the fact that considerable In addition to these methods of credit examounts of notes are already in the hands of pansion, borrowing facilities for governthe public makes it less easy to check an ex- ments under existing or amended regulations pansion of active purchasing power than provided in many instances the basis for the when savings are held as bank deposits or in increase in note circulation. Occasionally— the form of more permanent investments. as in the Netherlands—borrowing by the One effect of the propensity to hoard, and government could take place within the exalso of the greater holding of notes generally, isting legal framework which fixed the relais that changes in note circulation no longer tions between the government and the central form a reliable index of the presence or ab- bank. Frequently, however, it was found sence of inflationary tendencies. It then be- necessary to render the existing regulations comes all the more important to consider the less stringent in order to increase the governgeneral effects of extensions of credit for gov- ment's ability to obtain funds from the cenernments and other borrowers. Inflationary tral bank, whether directly or indirectly, tendencies may be offset by forces acting in through open-market operations. the opposite direction, as is the case, for ex- The French Government, for example, by ample, when monetary reserves are used for a decree of September 1, 1939, approved foreign payments, or the inflationary pres- and put into effect the provisions in the consure is counteracted by direct control of costs vention of September 29, 1938, under which and commodity prices and by appropriate advances up to 25,000,000,000 French francs methods of government borrowing designed were to be made available by the Bank of to recapture for the state any excess of mone- France to the Treasury at the time of general tary purchasing power in the hands of the mobilization, the rate of interest being one public. per cent, to be raised to 3 per cent one year The amount of notes hoarded is, of course, after the cessation of hostilities. In the furdifficult to indicate with exactitude, but some ther convention between the Bank of France general estimates are available. In the An- and the French Treasury of February 29, nual Report of the Bank of France for 1939 1940, a new advance up to 20,000,000,000 it is said that of approximately 25,000,000,- French francs was agreed upon in the form of 000 French francs in notes put into circula- negotiable Treasury bills, carrying no yield tion between August 17 and September 17, while held by the Bank, but receiving interest 1939, constituting a 20 per cent increase in at market rates when sold. In Germany the circulation, the greater part went into emer- law of June 15, 1939, concerning the German gency hoards of private persons. The Presi- Reichsbank had already, prior to the war, dent of the Board of the Swiss National Bank abolished the fixed limits of RM100,000,000 said in his speech to the General Assembly for the working credits to the Finance Minisof the Bank that the volume of domestic and try and RM400,000,000 for the discounts of foreign hoarding of Swiss notes was at least Treasury bills and had left it to the Fiihrer 600,000,000 Swiss francs at the end of 1939, and Reich Chancellor to determine the new out of a total circulation of 2,050,000,000 limits. In Switzerland the Board of the Na- Swiss francs. tional Bank increased the upper limit of the In a number of countries an expansion of discount of the Swiss Government on Septhe note circulation in 1939 was carried tember 15, 1939, as a precautionary measure. through without difficulty by the simple con- In Belgium amendments to the statutes of version of large amounts of cash held with the National Bank of September 23, 1939 (in the central bank in the form of deposits accordance with the Royal Decree of August already owned by private credit institutions. 24), gave the National Bank power to dis- Thus in Switzerland, for example, the depos- count, buy and sell short or medium-term its held with the Swiss National Bank were paper issued or guaranteed by the Belgian drawn down 317,000,000 Swiss francs be- State, by the Congo Colony or by the Grand tween August 1, 1939, and the end of the Duchy of Luxemburg, and to buy and sell OCTOBER 1940 1093 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports national securities issued at long term and note issue plus roughly Yen 500,000,000 in quoted on the stock exchanges to an amount gold held by the Bank of Japan, and under of 5,000,000,000 Belgian francs as compared the existing provisions the Bank was then with 500,000,000 Belgian francs previously. required to pay a 3 per cent tax to the Treas- In addition, the National Bank was empow- ury on the amount of excess note issue. ered to buy public securities up to an amount The increase in the amount of notes a cencorresponding to its capital reserves and tral bank could issue was, however, in some amortization funds. instances brought about through a revalua- In the United Kingdom, immediately after tion of gold holdings. Through the conventhe outbreak of the war the Chancellor of tion of February 29, 1940, already mentioned the Exchequer announced on September 6 above, the gold stock of the Bank of France that the Bank of England would transfer was again revalued at a new rate of 47,605 almost its entire gold stock to the Exchange French francs or at almost the same price Equalization Account, at the same time rais- (47,608 French francs) as had been set by ing the fiduciary issue from £300,000,000 to the Bank each day since September 13, 1939. £580,000,000 and abolishing all limitations of The book profits from the revaluation, the the Exchange Equalization Account's powers fourth undertaken since the devaluation in to borrow against Treasury bills. A similar 1936, amounted to about 17,300,000,000 transfer of gold and foreign exchange from French francs, which, together with around the Bank of Canada to the Canadian Foreign 3,000,000,000 French francs from the re- Exchange Control Board took place in early sources of the Exchange Stabilization Fund, May 1940 to the amount of $250,000,000. In were ceded to the government to be used for France the statutory 35 per cent gold cover repaying to the Bank of France temporary for the note circulation was suspended at the advances granted between 1936 and 1938. outbreak of war, and at the time of the con- On March 31, 1940, the gold stock held by vention between the Bank of France and the the Nederlandsche Bank was revalued at a French Treasury in February 1940 30,000,- price, equivalent to the depreciation of the 000,000 French francs of gold was trans- currency by about 18 per cent, compared with ferred from the Bank of France to the Ex- the actual 22 per cent depreciation of the change Stabilization Fund against negotiable guilder against the dollar. Out of the revalubills which may be sold or repurchased on ation profits the government received F1.132,the open market. In Germany the law of June 500,000 and the Nederlandsche Bank F1.13,- 15, 1939, regarding the German Reichsbank 900,000, which were used to the extent of finally relieved the Bank of its obligation Fl.7,600,000 to write off remaining losses (previously in suspense) to redeem its notes on sterling (from 1931), the balance of in gold and foreign exchatige and provided Fl.6,300,000 being utilized to replenish the that reserves in gold and foreign exchange Bank's open reserve. At the end of February should be held to the amount that the Reichs- 1940 the Minister of Colonies of the Netherbank deemed necessary to provide for the lands proposed a similar revaluation for the settlement of payments abroad and the main- Fl. 133,000,000 gold stock of the Bank of tenance of the value of the currency. In Swe- Java. den, a law of December 22, 1939, changed When on January 31, 1940, the Swedish certain provisions in the law of the Riksbank, Government, in virtue of the law of Decemand on January 31,1940, on the basis of these ber 22, 1939, amended the provisions regardpowers, the primary cover of the note circu- ing note cover for the Riksbank, the gold lation, which had previously been limited to holdings of the Bank were calculated at the gold at home, was extended to comprise also current value of 4,726 Swedish kronor per gold abroad, thus permitting the Riksbank kilogram as compared with the parity value to place further amounts of its gold under of 2,480 Swedish kronor, but only for the earmark abroad. purposes of calculating the right of note- In Japan, where the fiduciary issue of the issue. Actually no formal revaluation took Bank of Japan had been increased from Yen place and hence no formal "profit" was made 1,000,000,000 to Yen 1,700,000,000 on April available. On the weekly statements of the 1, 1938, a further increase to Yen 2,200,000,- backing for the note circulation of the Riks- 000 was authorized on April 1, 1939. In De- bank, gold has been entered at the current cember 1939, however, the average note cir- value, whereas on the monthly balance sheets culation exceeded the amount of the fiduciary the old valuation has been retained. On Oc- 1094 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports tober 5 the National Bank of Yugoslavia was 15,1939, contains the provision that the Bank permitted, in computing its ratios of gold is to be managed and directed in accordance cover to note circulation and sight obliga- with and under the direct supervision of the tions, to calculate the value of its gold at the Fuhrer and Reich Chancellor, a provision actual dinar value, involving a premium of which incidentally gives the Bank equal 60 per cent above the "stabilized" dinar value status with the various government departcompared with the premium of 2814 per cent ments. By the same law the name of the at which gold was carried. In the balance- Bank was altered from the Reichsbank to the sheet of the National Bank, however, no re- German Reichsbank; holdings of shares were valuation of the gold holding was shown. restricted to German nationals eligible for The changes in central bank regulations citizenship and to legal persons or concerns and practices indicated above have been as- within the German Reich. Within the Bank sociated with the urge for liquidity, the pres- itself the position of the President was sure on government finance and increased strengthened by his being given the decisive foreign payments, but changes were also voice on the Board of Directors. The former made for other reasons during the year, as Central (Advisory) Committee of the sharee. g. in connection with jurisdiction over holders was replaced by an Advisory Council, areas affected by the war, increase in gov- which serves as a link with German trade ernment control, etc. and industry. A German decree of September 5 provided Further changes were made in the statutes for the transfer of the management of the of the German Reichsbank on September 30, Bank of Danzig to the Reichsbank and also 1939, covering a number of minor matters made provision for the liquidation of the including the management of branches, the Bank. On September 11 the Bank ceased rights of shareholders, the procedure for the issuing gulden notes and its office began annual meeting and so forth. The terms were operations as a branch of the Reichsbank. fixed for the constitution of the Advisory After the outbreak of hostilities between Council and provision was made for the estab- Germany and Poland on September 1 the lishment of Regional Advisory Councils asso- Bank Polski was evacuated from Warsaw on ciated with the more important branch offices September 5. Its gold stock and part of its of the Bank. At a meeting of the Advisory personnel having been transferred to Paris, Council on October 29, 1939, a general comthe Bank was reopened for business on a mittee was formed and in addition special modified basis in that city during the month committees for credit, capital market, stock of October. In the territory of Poland occu- exchange, currency and foreign trade. pied by Germany, Reichskreditkassen were The tendency to increase government conorganized. When later a distinction was trol over the central bank, which began to made between the districts of Poland incor- make itself felt in New Zealand in 1935, porated into the German Reich and those reached its culmination in the Reserve Bank placed under the Governor-General, the of New Zealand Amendment Act of 1939, Reichskreditkassen in the districts incorpo- passed as a part of the war finance legislarated into the Reich were transformed into tion. This Act requires the Governor and branches of the Reichsbank. In the Gover- the Bank Board to give effect to government nor-Generalship a decree of December 15 decisions, empowers the Minister of Finance provided for a new Bank of Issue in Poland. to suspend or vary the reserve ratio and Until this Bank was opened in April 1940 authorizes the revaluation of the Bank's gold Reichskreditkassen operated on a zloty basis to market value and the holding of the profit with a head office first at Lodz and then at thereon in a special reserve on behalf of the Cracow. government. The trend towards government control of Cooperation among central banks has, of central banking has naturally been accentu- course, been interrupted for the time being ated by the exigencies of the war and may be between the institutions of the belligerent illustrated by the emergency powers given to countries, but in other directions some develgovernments to make changes by decree in opments are to be found, largely regional in central bank regulations, as under the De- character. In January 1939 the Governors fense (Finance) Act in England and the en- of the national banks of the Balkan Union actment of the law of December 22 in Swe- (Yugoslavia, Roumania, Greece and Turkey) den. The German Reichsbank Law of June met in Belgrade to discuss technical financial OCTOBER 1940 1095 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Foreign Banking Laws and Reports questions of common interest and arranged CONCLUSION for closer collaboration in the financial In a large part of the world ordinary ecosphere. On October 14 and 15, 1939, meetnomic and financial considerations are now ings took place in Copenhagen between repovershadowed by the necessities of war. Much resentatives of the central banks of Denmark, of the intensified government control, the di- Finland, Iceland, Norway and Sweden. Akin version of trade and the disruption of the to this regional cooperation among central economic and financial systems will, it must banks, although different in form, have been be hoped, be only temporary in character; the conferences among representatives of the but below the tumult of the war no doubt 21 American Republics, which have led to the more fundamental changes are taking place establishment of an Inter-American Ecowhich will have repercussions on the future nomic and Financial Advisory Committee life not only of Europe but of the whole maintained in Washington for the discussion world. What these developments may be of problems of trade and finance arising from necessarily escapes in large measure the conthe war in Europe. This Committee was temporary observer; but the post-war generestablished by a resolution of a meeting of ation will have to face the problems created by Foreign Ministers of American States, which the war and will in addition feel the impact took place in Panama in September 1939; of the more deep-seated long-trend changes. acting in accordance with a further resolu- It is of paramount importance to have tion adopted by a Pan-American Conference ready at the end of hostilities as clear a picof Treasury Department Representatives in ture as can possibly be made of the economic Guatemala in November, the Committee has and financial situation and the problems to drawn up plans for the establishment of an be dealt with. Not only must delay be Inter-American Bank. avoided but such mistakes as are due to in- In the plan for the Inter-American Bank a sufficient knowledge and lack of skilled considerable part is allotted to the govern- organization should be reduced to a miniments, as regards both the direction and the mum. Post-war relief and reconstruction— transactions to be undertaken; and the estab- with the means available to the modern world lishment of this Bank thus provides another and especially if accumulated resources are example of the tendency to increase govern- put to active use—should not be too great a ment influence in the sphere of central bank- task, however formidable the disruption may have been. With all the practical experiing. In European countries this tendency ence gained in the past twenty-five years more clearly reflects the urge to strengthen much more is known about monetary and government authority in times of national commercial problems than in the period folemergency when monetary policy becomes lowing the last war, and the world is in many increasingly subordinated to the immediate respects far better equipped to grapple with needs of the State. Although the formal inthe questions at issue. dependence of central banks—as part of the It is remarkable to what extent men's system of safeguards which has gradually minds in nearly all nations have turned to been developed to guarantee monetary stathe problems of economic and financial bility—is generally reduced by these emerorganization which will beset the world when gency measures, the actual field of activity the war is over. Apart from certain data of most central banks is perhaps rather exkept secret for military or similar reasons panded. In so far as authority tends to be the amount of information available as to the centralized in times of great difficulty, the tendencies and problems in the various councentral banks acquire new functions to pertries is not inconsiderable, and, with the help form, which they, by reason of their close of national institutions, the possibilities of association with money and exchange marpresenting an analysis of the situation prekets, are better fitted to carry out than the vailing at the end of the war should be great. ordinary government departments. More- In the end the desire of nations to cooperate over, the part which central banks play as and organize the world in a reasonable manadvisers to their governments assumes ner is, of course, the decisive factor without greater importances when government con- which no amount of specialized skill can trol is extended to previously unregulated achieve results; but, given the will to coopersections of the national economy and pressing ate, adequate means should be ready at hand fiscal and financial problems have to be solved.for the pressing work of reconstruction. 1096 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

A/atlonaL Summattf ofi Hu.5ine5& Condition* Compiled September 16 and released for publication September 18. Figures shown on charts may differ from preliminary figures used in text. Later developments are discussed on pages 1029-1039 of this BULLETIN. PRODUCTION and employment in August Output of automobiles was in small volume r showed a further rise from the level main- in August owing to the seasonal change-over tained in June and July and distribution to to 1941 model cars. The low point in producconsumers also increased. Prices of indus- tion was reached early in August; there was trial materials were somewhat higher in the a gradual rise later in that month followed middle of September than a month earlier. by a sharp advance in the first two weeks of September as most companies began volume Production production on new models. Lumber produc- The Federal Reserve index of industrial tion, which had declined in July, rose conproduction is estimated at 123 in August as siderably in August. compared with 121 in June and July and 111, Textile mill activity continued to increase the low point for the year, in April. This in August and was at the highest level since rise has reflected chiefly the direct and inlast January. Cotton consumption advanced direct effects of the defense program on considerably further and silk deliveries rose industries producing durable goods and texfrom the small volume of recent months. tiles. Steel production rose further in Au- Activity at wool textile mills increased seagust as new orders for steel continued in sonally, following a sharp rise in July, while large volume, and for the month as a whole at rayon mills activity showed a less than mills operated at 90 per cent of capacity. seasonal increase but continued at a high Following a temporary decline over the level. Labor Day week, the rate of output advanced to 93 per cent of capacity in the third Mining of bituminous coal in August was week of September. In most branches of the maintained in large volume for the season, machinery industries activity showed a con- while production of anthracite declined. tinued expansion in August and there were Output of crude petroleum declined somefurther sharp increases in shipbuilding and what further. the manufacture of aircraft. With the Value of new construction work undergrowth in production of finished durable taken in August was at about the same level goods, consumption of nonferrous metals ad- as in July, according to reports of the F. W. vanced to the highest levels since last winter. Dodge Corporation and the Federal Reserve INDUSTRIAL PRODUCTION FACTORY EMPLOYMENT PER CENT 140 120 ' 130 / 110 \ 120 J 100 J 100 J no J \ / rv i J V 100 90 V 90 / V 90 80 80 70 70 60 60 1934 1935 1937 1939 1934 1935 1936 1937 1938 1939 1940 Index of physical volume of production, adjusted for seasonal Monthly index of number employed at factories, adjusted for variation, 1935-1939 average = 100. seasonal variation, 1923-1925 average = 100. OCTOBER 1940 1097 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

National Summary of Business Conditions Bank of San Francisco. The volume of con- showed little change in this period, although tracts for public projects continued unusu- some paper items were reduced and several ally large and the amount of new private new models of automobiles were announced work started was larger than in July. Resi- at advanced prices. dential building was at the highest level in recent years, on a seasonally adjusted basis, Agriculture reflecting further increases in both private and public contracts. Production prospects for most major crops increased during August, according to the Distribution Department of Agriculture. On the basis of September 1 conditions the cotton crop was Distribution of commodities to consumers estimated at 12,772,000 bales, about 1,340,000 increased considerably from July to August. bales more than was indicated at the begin- Sales at department stores and by mail order ning of August. Preliminary estimates by houses showed a sharp rise and there was a the Department indicate that cash farm inless than seasonal decline in variety store come, including Government payments, will sales. In the early part of September departbe about $8,900,000,000 for the calendar year ment store sales continued to increase. 1940 as compared with $8,540,000,000 last Freight-car loadings advanced from July year. to August when little change is usual. Shipments of coal and miscellaneous freight in- Bank Credit creased while loadings of grain showed more Commercial loans increased somewhat at than a seasonal decline. banks in New York City and in 100 other leading cities during the four weeks ending Commodity Prices September 11, while their holdings of in- Prices of several industrial materials, in- vestments showed little change. cluding copper, zinc, steel scrap, lumber, hides, and print cloth, advanced somewhat United States Government Security Prices from the middle of August to the middle of September and, owing partly to seasonal de- United States Government security prices velopments, prices of foodstuffs were also increased in the last half of August and the higher. Prices of most other commodities first week in September and were steady in the second week in September. CONSTRUCTION CONTRACTS AWARDED MILLIONS OF DOLLARS MILLIONS OF DOLLARS 500 DEPARTMENT STORE SALES AND STOCKS 400 400 300 300 200 200 100 — Y-5 100 50 1934 1935 1936 1937 1938 1939 1940 40 Three-month moving averages of F. W. Dodge data for value 1936 1937 1938 1939 1940 of contracts awarded in 37 Eastern States, adjusted for seasonal variation. Latest figures based on data for July and August and Indexes of value of sales and stocks, adjusted for seasonal variaestimate for September. tion, 1923-1925 average = 100. 1098 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FINANCIAL, INDUSTRIAL, AND COMMERCIAL STATISTICS UNITED STATES PAGE Member bank reserves, Reserve Bank credit, and related items 1101 Federal Reserve Bank discount rates; rates on time deposits, reserve requirements 1102 Federal Reserve Bank statistics 1103-1107 Reserve position of member banks; deposits in larger and smaller centers . 1108 Money in circulation 1109 Gold stock and gold movements; bank suspensions; bank debits 1110 All banks in the United States, number, deposits, loans and investments . . . 1111 Condition of all member banks . . 1112-1113 Weekly reporting member banks . . 1114-1117 Commercial paper, bankers' acceptances, and brokers' balances . . 1118 Money rates and bond yields 1119 Security markets 1120 Treasury finance 1121-1122 Governmental corporations and credit agencies; Postal Savings System . . . 1123-1124 Business Indexes 1125-1135 Wholesale prices . . 1136 Statistics for Federal Reserve chart book . . 1137-1138 Crop report 1138 Tables on the following pages include the principal available statistics of current significance relating to financial and business developments in the United States. The data relating to the Federal Reserve Banks and the member banks of the Federal Reserve System are derived from regular reports made to the Board; index numbers of production are compiled by the Board on the basis of material collected by other agencies; figures for gold stock, money in circulation, Treasury finance, and operations of Government credit agencies are obtained principally from statements of the Treasury, or of the agencies concerned; data on money and security markets and commodity prices and other series on business activity are obtained largely from other sources. Back figures may in most cases be obtained from earlier BULLETINS and from Annual Reports of the Board of Governors for 1937 and earlier years. Current figures compiled by the Board are generally released prior to publication in the BULLETIN and press statements will be sent without charge to those wishing them. For a list of current releases see FEDERAL RESERVE PUBLICATIONS at the back of this BULLETIN. OCTOBER 1940 1099 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MEMBER BANK RESERVES AND RELATED ITEMS BILLIONS OF DOLLARS 20 18 18 16 16 14 12 10 4 * TREASURY DEPOSITS AT F. R. BANKS 14 12 10 MEMBER BANK RESERVE BALANCES 1934 1935 1936 1937 1938 1939 1940 Latest figures for September 25. See page 1101. 1100 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MEMBER BANK RESERVES, RESERVE BANK CREDIT, AND RELATED ITEMS [In millions of dollars] Reserve Bank credit outstanding Menber Treas- bank r3serve Date co B d u i i n s l - l t s ed T U o . t a S l . s ec G t w u M u o r i r v i t i a t h n e i - - e r g n s m t a M u e f r n t i e a t n r - g R c B o r e e A t s a h d e l n e l i r k t r v i e Total s G to o c ld k s T r t o e c u i r a n n u u e r n y g r c a t d - - y s - - M i c n t u i o o l c n a n i e r - - y T h c i u r n o a e r g l s y a d h s s - - u B p s w F r e R e o a y e r r i s n e a t v d i - k h d l t e - s e s - p m N o b d e o e s e m - i n r t - s - c O s F o e R e a t e r u r c e h a v d - n - e l e - t r s To b t a a l l arte c e E e s s x s - 2 in 5 5 years years Monthly averages of daily figures: 1939—June 4 2,563 1,733 830 23 2,591 16,028 2,870 6,966 2, 568 929 682 258 10,085 4,246 July 5 2,527 1,697 830 37 2,569 16,182 2,887 7,051 2,534 780 695 257 10,'321 4,402 August 5 2,437 1,606 831 25 2,467 16, 390 2,900 7,098 2,344 783 616 256 10, 659 4,607 1940—June. - 2 2,474 1,206 1,269 65 2,542 19, 560 3,010 7,752 2,194 286 1,026 259 13, 596 6,696 July 3 2,450 1,202 1,247 63 2,515 20, 260 3,017 7,884 2,206 391 1,316 261 13, 735 6,752 August 3 2,444 1,201 1,244 57 2,505 20, 718 3,028 7,967 2,277 885 1,451 262 13, 408 6,407 End of month figures: 1939—June 30.... 5 2,551 1,720 830 23 2,579 16,110 2,881 7,047 2, 563 944 739 258 10,018 4,140 July 31.— 5 2,488 1,658 830 -8 2,486 16, 238 2,895 7,049 2,360 752 693 257 10,507 4,553 Aug. 31 5 2,426 1,594 832 15 2,446 16, 646 2,907 7,171 2,325 708 622 255 10,918 4,758 1940—June 29.... 2 2,466 1,204 1,262 63 2,531 19, 963 3,014 7,848 2,186 234 1,198 261 13, 781 6,857 July 31.— 4 2,448 1,202 1,246 32 2,484 20. 463 3,024 7,883 2,250 694 1,382 262 13.498 6,514 Aug. 31._._ 4 2,436 1,192 1,244 75 2,515 20, 913 3,036 8,059 2,277 810 1,516 261 13, 541 6,525 Wednesday figures: 1939—Nov. 1 6 2,721 1,502 1,219 38 2,765 17,099 2,932 7,352 2,250 349 790 241 11,814 5,376 Nov. 8 6 2,687 1,468 1,219 28 2,721 17,132 2,935 7,409 2,263 348 779 241 11,749 5,354 Nov. 15.... 6 2,649 1,439 1,210 60 2,715 17,235 2,939 7,384 2,341 564 772 241 11, 587 5,166 Nov. 22. 8 2,593 1,403 1,191 44 2,645 17, 257 2,942 7,434 2,357 466 727 241 11,619 5,171 Nov. 29.... 8 2,552 1,362 1,191 45 2,605 17, 347 2,947 7,462 2,359 441 776 241 11,620 5,135 Dec. 6 8 2,512 1,324 1,189 47 2,568 17,408 2,949 7,545 2,391 346 785 241 11,617 5,154 Dec. 13 8 2,512 1,324 1,189 23 2,543 17,464 2,954 7,564 2,398 753 719 240 11,288 4,849 Dec. 20__._ 8 2,496 1,324 1,173 140 2,645 17, 576 2,959 7,679 2,411 694 765 253 11, 378 4,900 Dec. 27— 8 2,489 1,220 1,270 71 2,568 17, 620 2,963 7,663 2,417 646 678 255 11,493 5,046 1940—Jan. 3 7 2,484 1,220 1,265 73 2,564 17, 697 2,963 7,581 2,367 651 653 251 11,721 5,271 Jan. 10 7 2,477 1,220 1,258 20 2,504 17,747 2,965 7,463 2,341 655 677 250 11,830 5,377 Jan.17 7 2,477 1,220 1,258 31 2,515 17,805 2,968 7,405 2,361 575 678 250 12,020 5,502 Jan. 24 7 2,477 1,220 1,258 30 2,514 17,879 2,969 7,365 2,381 507 713 249 12,148 5,592 Jan. 31 7 2,477 1,220 1,258 18 2,503 17,931 2,971 7,376 2,358 549 723 248 12,150 5,559 Feb. 7 7 2,477 1,218 1,259 33 2,518 17,998 2,973 7,403 2,365 632 743 249 12,097 5,523 Feb. 14 7 2,477 1,215 1,263 46 2,530 18,063 2,977 7,411 2,385 642 733 249 12,151 5,580 Feb. 21 6 2,477 1,209 1,268 40 2,523 18,108 2,977 7,450 2,358 596 716 248 12,241 5,629 Feb. 28 7 2,477 1,209 1,268 54 2,537 18,166 2,980 7,439 2,374 561 744 248 12, 318 5,689 Mar. 6 3 2,477 1,209 1,268 35 2,515 18,220 2,984 7,481 2,358 536 731 246 12, 367 5,733 Mar. 13.... 3 2,477 1,209 1,268 44 2,524 18, 282 2,985 7,463 2,362 526 754 247 12,439 5,777 Mar. 20 2 2,475 1,209 1,266 42 2,520 18,360 2,989 7.484 2,374 707 791 256 12, 256 5,594 Mar. 27.... 2 2,475 1,209 1,266 32 2,510 18,413 2,990 7,471 2,382 700 808 256 12,294 5,679 Apr. 3 3 2,467 1,205 1,262 42 2,512 18,470 2,991 7,521 2,372 692 737 256 12, 395 5,815 Apr. 10 2 2,467 1,205 1,262 31 2,500 18, 523 2,993 7,509 2,353 590 733 256 12, 575 5,949 Apr. 17 2 2,467 1, 205 1,262 45 2,514 18,631 2,992 7,536 2,313 513 762 257 12, 757 6,048 Apr. 24 2 2,467 1,205 1,262 32 2,501 18, 708 2,997 7,520 2,305 470 773 256 12,883 6,116 May 1 3 2,467 1,205 1,262 30 2,500 18,771 3,000 7,570 2,293 490 793 256 12, 870 6,107 May 8 3 2,467 1,205 1,262 38 2,507 18,835 3,004 7,589 2,309 512 802 256 12, 877 6,131 May 15 3 2,474 1,205 1,269 41 2,518 18,949 3,004 7,598 2,223 425 878 254 13.094 6,300 May 22 2 2,477 1,206 1,271 41 2,520 19,071 3,007 7,613 2,204 370 935 254 13, 223 6,373 May 29 .... 3 2,477 1,206 1,271 31 2,511 19,162 3,007 7,685 2,200 378 950 253 13, 215 6,362 June 5 3 2,477 1,206 1,271 50 2,530 19,281 3,008 7,718 2,205 308 949 252 13, 387 6,533 June 12 2 2,477 1,206 1,271 43 2,523 19,427 3,009 7,717 2,200 265 1,014 253 13, 510 6,607 June 19 2 2,473 1,206 1,267 63 2,539 19, 769 3,011 7,741 2,204 298 1,098 266 13,712 6,767 June 26 2 2,473 1,206 1,267 36 2,511 19, 871 3,012 7,780 2,186 301 1,139 266 13, 723 6,801 July 3 2 2,450 1,202 1,248 51 2,503 20,063 3,014 7,924 2,190 221 1,245 262 13, 737 6,812 July 10 .— 2 2,450 1,202 1,248 39 2,491 20,166 3,015 7,884 2,191 297 1,274 261 13, 764 6,833 July 17 .... 2 2,450 1,202 1,248 49 2,501 20,256 3,016 7,872 2,199 278 1,299 261 13,863 6,882 July 24.... 3 2,450 1,202 1,248 38 2,491 20,367 3,020 7,854 2,229 643 1,327 261 13, 565 6,570 July 31 .... 4 2,448 1,202 1,246 32 2,484 20,463 3,024 7,883 2,250 694 1,382 262 13,498 6,514 Aug. 7 3 2,446 1,202 1,244 22 2,471 20,568 3,025 7,929 2,276 923 1,386 263 13, 286 6,325 Aug. 14.... 3 2,446 1,202 1,244 47 2,495 20,689 3,027 7,944 2,281 940 1,444 262 13, 340 6,392 Aug. 21.... 3 2,446 1,202 1,244 44 2,492 20,800 3,030 7,976 2,291 889 1,486 261 13,419 6,417 Aug. 28— 4 2,442 1,198 1,244 35 2,480 20,871 3,034 8,006 2,291 813 L, 498 261 13, 516 6,487 Sept. 4 6 2,434 1,191 1,243 51 2,490 20, 944 3,036 8,092 2,292 791 L, 510 261 13, 524 6,494 Sept. 11—_ 5 2,434 1,191 1,243 47 2,485 20, 981 3,038 8,080 2,287 762 ,520 260 13, 596 6,541 Sept. 18— 4 2,434 1,191 1,243 57 2,495 21,093 3,040 8,084 2,311 790 ,549 270 13, 624 6,531 Sept. 25..-. 5 2,434 1,191 1,243 34 2,472 21,166 3,041 8,090 2,298 793 :,525 270 13, 703 6,645 1 Includes industrial advances and bills bought, shown separately in subsequent tables. * End of month and Wednesday figures estimated. NOTE.—For description of figures in this table and discussion of their significance, see BULLETIN for July 1935, pp. 419-429. Reprints of article together with available back figures, may be obtained upon request from Division of Research and Statistics. Back figures are also shown in Annual Report for 1937 (tables 3 and 4) and for excess reserves in BULLETIN for August 1935, pp. 499-500. Back figures for end of month and Wednesday dates since January 6,1937 on maturity distribution of security holdings will be supplied on request. 1101 OCTOBER 1940 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FEDERAL RESERVE BANK DISCOUNT RATES [Per cent per annum] Rediscounts and advances under sections Advances secured by direct obligations 13 and 13a of the Federal Reserve Act of the United States (last paragraph of except last paragraph of Section 13 Advances under Sec- Section 13 of the Federal Reserve Act) tion 10 (b) of the Secured by direct and Federal Reserve Act eligible guaranteed ob- All other To banks To others Federal Reserve Bank ligations of the U.S. Rate In Rate In Rate In Rate In Rate In Sept. effect Sept. effect Sept. effect Sept. effect Sept. effect 30 beginning— 30 beginning- beginning— 30 sginning— 30 beginning- Boston Sept. 1, 1939 Sept. 1, 1939 Sept. 2, 1937 Sept. 1, 1939 Apr. 29, 1938 New York..... Aug. 27, 1937 Aug. 27, 1937 Oct. 10, 1935 Aug.25, 1939 Feb. 8, 1934 Philadelphia- Sept. 4, 1937 Sept. 4, 1937 Sept. 4, 1937 Sept. 1, 1939 Sept 1, 1939 Cleveland May 11, 1935 May 11, 1935 Oct. 19, 1935 Sept. 1, 1939 May 11, 1935 Richmond Aug. 27, 1937 Aug. 27, 1937 Sept. 10, 1937 Sept. 1, 1939 Feb. 19, 1934 Atlanta Sept. 16, 1939 Aug. 21, 1937 Aug. 21, 1937 Sept.16, 1939 Apr. 23, 1938 Chicago Sept. 1, 1939 Aug. 21, 1937 Aug. 21, 1937 Sept. 1, 1939 Oct. 16, 1933 St. Louis Sept. 21, 1939 Sept. 2, 1937 Sept. 2, 1937 Sept.16, 1939 Feb. 23, 1935 Minneapolis.. Aug. 24, 1937 Aug. 24, 1937 Aug. 24, 1937 Sept. 1, 1939 Oct. 8, 1938 Kansas City.. Sept. 16, 1939 Sept. 3, 1937 Sept. 3, 1937 Sept.16, 1939 Apr. 16, 1938 Dallas Sept. 16, 1939 Aug. 31, 1937 Aug. 31, 1937 Sept.16, 1939 Apr. 16, 1938 San Francisco. Sept. 3, 1937 Sept. 3, 1937 Sept. 17, 1937 Sept. 1, 1939 Oct. 19, 1933 i Two and one-half per cent to lenders other than banks. NOTE.—Rates applicable to United States Government securities' repurchase agreements are as follows: New York, one per cent; Cleveland, Kansas City, and Dallas, one and one-half per cent. Back figures—See Annual Report for 1937 (table 40). FEDERAL RESERVE BANK BUYING RATES ON ACCEPTANCES FEDERAL RESERVE BANK RATES ON INDUSTRIAL ADVANCES [Per cent per annum] Rates in effect Sept. 30, 1940, on advances and commitments under Sec. 13b of the Federal Reserve Act Maturity e S R f e f a e p c t t e t . i 3 o n 0 n In g in e n ff i e n c g t — be- Pre ra v t i e ous [Per cent per annum except as indicated by footnote 3] 1-15 days i._. Oct. 20, 1933 Advances to finan- 16-30 days— ...do ing institutions— 31-45 days... Vi ...do Advances 46-60 days... ...do direct to Commit- 61-90 days... ...do Federal Reserve Bank industrial On por- ments 9 1 1 2 - 1 1 - 2 1 0 8 0 d a d y a s. y . s. 1 . . . . . . d d o o m o e r r c c ia o l m o - r- t w io h n i c fo h r m O a n in r i e n - g a t d o v m an a c k e e s ganizations institu- portion i This rate also applies to acceptances bought under repurchase agree- tion is ments, which agreements are always for a period of 15 days or less. obligated NOTE.—Minimum buying rates at the Federal Reserve Bank of New York on prime bankers' acceptances payable in dollars; higher rates may be charged for other classes of bills. The same minimum Boston rates apply to purchases, if any, made by other Federal Reserve Banks. New York 1-2 Back figures—See Annual Report for 1937 (table 41). P C h le i v la e d la e n l d phia- 4^ 4 - - 6 6 0) A ) Vz-2 Richmond 6 4-6 4-6 1-2 MEMBER BANK RESERVE REQUIREMENTS Atlanta 4^-6 4-5 4-5 1-2 [Per cent of deposits] Chicago 5-6 0) 5-6 1-2 St. Louis 4 1 Clas a se n s d o b f a d n e k p s osits J A u 1 u 1 n 9 g 9 e 1 . 3 7 6 1 - 2 5 1, , A Fe 1 u 1 9 b g 9 3 . . 3 6 2 7 1 - 8 6 , , A M 1 p 1 a 9 r 9 r 3 . 3 . 7 7 3 - 1 0 , , A M 1 p 1 a 9 r 9 y . 3 3 7 1 8 1 - 5 , , A 1 a p a 9 f r n t . 3 e d 8 1 r - 6, S M K D a a a i n l n n l s a n F a s e r s a a n p C c o i i l s t i c y s o . . . . . 4 5 5 - - - 6 6 6 6 3-4 4 4 5- - 6 5 4 2 1 1 On net demand deposits:1 i Authorized rate one per cent above prevailing discount rate. R C e e s n e t r r v al e r c e i s t e y rve city.. 1 1 3 0 1 1 9 5 3^ 2 W 2 A ^ 2 2 6 0 2 V 2 l % A » 3 S M a i m ni e m a u s m to c b h o a r r r g o e w o e n r e b -h u a t l f n o o t f l o e n s e s p th e a r n c e fo n u t. r per cent. On C o ti u m n e tr d y eposits: 7 ioy2 12M 14 12 Back figures—See Annual Report for 1937 (table 40). All member banks 3 5M 6 5 VA MAXIMUM RATES ON TIME DEPOSITS i See footnote to table on p. 1108 for explanation of method of computing net demand deposits. Maximum rates that may be paid by member banks as established by the Board of Governors under provisions of Regulation Q. MARGIN REQUIREMENTS1 [Per cent per annum] Prescribed by Board of Governors of the Federal Reserve System in accordance with Securities Exchange Act of 1934 Nov. 1, 1933 Feb. 1, 1935 In effect [Per cent of market value] to to beginning Jan. 31, 1935 Dec. 31, 1935 Jan. 1, 1936 Apr. 1, Nov. 1, 1936- 1937 Oct. 31, and Savings deposits 1937 after Postal savings deposits Other time deposits pay- For extensions of credit by brokers and dealers on able in: F F o o li r r s l t s o e h d a o n r s s t e b s c a y u l r e b i s t a i , e n u s k n , s d u o e n n r d e s R t r o e R c g k u e s l g a , u t u i l o n at n d i o e T r n R T e _ gulation U__. 3 ( 5 5 2) 5 5 4 4 5 0 0 0 9 6 L 0 e m s d s o a n t y h t s h a s t n o o 9 6 r 0 m m d o o ay n re s ths 2 V V 2 2 l i Regulations T and U limit the amount of credit that may be extended on a security by prescribing a maximum loan value, which is a NOTE.—Maximum rates that may be paid by insured nonmember specified percentage of its market value at the time of the extension; banks as established by the Federal Deposit Insurance Corporation, the "margin requirements" shown above are the difference between effective February 1, 1936, are the same as those in effect for member the market value (100%) and the maximum loan value. banks. In some States the maximum rates established by the Board » Requirement under Regulation T was the margin "customarily and the Federal Deposit Insurance Corporation are superseded by required" by the broker. lower maximum rates established by State authority. * Regulation U became effective May 1, 1936. NOTE.—Regulations T and U also provide special margin requirements or "omnibus" accounts and loans to brokers and dealers. 1102 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

PRINCIPAL ASSETS AND LIABILITIES OF ALL FEDERAL RESERVE BANKS [In thousands of dollars] Wednesday figures End of month 1940 1939 Sept. 2255 Sept. 18 Sept. 11 Sept. 4 Aug. 28 Aug. 21 Aug. 14 August July August Assets Gold certificates on hand and due from U. S. Treasury 18, 843, 300 18;, ,756, 29818, 671, 299 18, 631, 297 18, 561, 97818, 486, 978 18I,, 387, 98018, 606, 30018,188,97714, 312, 222 Eedemption fund—F. R. notes 11, 790 11, 398 11, 397 11, 398 11,826 11, 826 11,951 11, 398 12, 852 8,644 Other cash 347, 534 344, 387 340, 820 322, 814 348, 390 354,056 362,066 341, 611 377, 336 339, 915 Total reserves 19, 202,62419,112, 08319,023, 516 18,965, 50918, 922,19418, 852, 86018, 761, 99718, 959, 30918, 579,16514, 660, 781 Bills discounted: For member banks 410 3,791 5,038 5,479 3,843 3,053 2,942 4,276 3,667 3,390 For nonmember banks, etc 4,172 300 200 55 5 5 5 55 5 2,025 Total bills discounted 4,582 4,091 5,238 5,534 3,058 2,947 4,331 3,672 5,415 Bills bought: Payable in foreign currencies.. 546 Industrial advances. 8,612 8,630 8,645 8,553 8,561 8,545 8, 518 11, 667 U. S. Government securities, direct and guaranteed: Bonds 1,318,600 1, 318, 600 1, 318, 600 1, 318, € 1, 319,196 1, 319,196 1, 319,1 1, 319,100 1, 321,196 912,460 Notes 1,115,000 1,115,000 1,115, 000 1,115,000 1,122, 458 1,126, 732 1,126, 732 1,116, 500 1,126, 732 1,179,109 Bills . 334, 620 Total U. S. Government securities, direct and guaranteed 2, 433, 600 2, 433, 600 2, 433, 600 2, 433, 600 2, 441, 654 2, 445, 928 2, 445, 928 2, 435, 600 2, 447, 928 2, 426,189 Other Reserve Bank credit 24, 860 48,461 37, 697 41, 896 25, 607 34, 820 37, 708 67,123 23, 065 2,347 Total Reserve Bank credit outstanding 2, 471, 706 2, 494, 764 2, 485,165 2, 489, 675 2, 479, 662 2, 492, 367 2, 495,128 2, 515, 572 2, 483, 549 2, 446,164 Liabilities F. R. notes in actual circulation. 5, 406, 985 5, 395,924 5, 393, 924 5, 390, 785 5, 334, 240 5, 309, 939 5, 292, 803 5, 370,474 5, 247, 601 4, 630, 672 Deposits: Member bank—reserve account.__ 13, 703,112 13, 624,419 13, 595, 82413, 523, 86113, 515, 99813, 418, 71813, 339, 587 13, 541, 244 13, 498,13410, 917, 763 U.S. Treasurer—general account.. 792, 532 790, 361 761, 686 791,182 813, 094 889, 274 940,004 809,827 707, 718 Foreign 1,011,324 1,035,459 956,537 997, 516 990, 660 867,059 841, 341 971,065 787, 371 353, 401 Other deposits 513, 645 513, 309 563, 403 512, 525 507, 088 618, 466 602, 924 545,116 594, 991 268,176 Total deposits 16,020, 613 15, 963, 54815, 877, 45015, 825, 08415,826, 84015, 793, 51715, 723, 85615, 867, 25215, 574, 57912, 247, 058 Ratio of total reserves to deposit and F. R. note liabilities combined (per cent) 19.5 19. 3 19.3 89.2 6.9 MATURITY DISTRIBUTION OF BILLS AND U. S. GOVERNMENT SECURITIES HELD BY FEDERAL RESERVE BANKS [In thousands of dollars] Total W 15 it d h a i y n s 16 to 30 31 d a t y o s 60 61 d a t y o s 90 m 91 o t o d n a t 6 h y s s i 1 m t y o o e n a t r hs 2 1 y t y o e e a a r r s 5 2 y y to e e a a r r s s 5 O y v e e a r rs Bills discounted: Aug. 28 3,848 2,217 233 518 187 Sept. 4 _ _ 5,534 3,806 323 499 218 Sept. 11 5,238 3,418 319 734 506 261 Sept. 18 _ 4,091 2,606 158 675 521 131 Sept. 25 4,582 2,929 263 474 741 174 Industrial advances: Aug. 28 8,553 1,565 173 242 953 1,271 1,526 2,525 Sept. 4 8,645 1,596 209 163 258 955 1,356 1,499 2,609 Sept. 11 1,568 253 138 911 1,372 1,508 2,611 Sept. 18 8, 612 1,598 136 311 205 781 1,484 1,518 2,579 Sept. 25 8,664 1,661 115 305 304 769 1,414 1,518 2 578 U. S. Government securities, direct and guaranteed: Aug. 28 2, 441, 654 .100,500 234, 247 129, 940 733, 467 1, 243, 500 Sept. 4 2, 433, 600 92, 500 234,100 129,800 734, 200 1, 243,000 Sept. 11 2, 433, 600 92, 500 234,100 129, 800 734, 200 1, 243,000 Sept. 18 2, 433, 600 92, 500 116, 800 117,300 196,000 668,000 1, 243,000 Sept. 25 2,433, 600 92, 500 116,800 117,300 196,000 668,000 1, 243, 000 OCTOBER 1940 1103 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

STATEMENT OF CONDITION OF THE FEDERAL RESERVE BANKS, BY WEEKS [In thousands of dollars] Total Boston Y N o e r w k P p d h h e i l i l - a a- C l l a e n v d e- m Ri o c n h d - l A an t t - a Chicago Lo S u t. is n M o e l a i i n p s - - K C s a a it n s y - Dallas F c S r is a a c n n o - Assets Gold certificates on hand and due from U.S. Treasury: A A Se u u p g g t . . . 2 2 4 1 8 1 1 1 8 8 8 , , , 4 6 5 8 3 6 6 1 1 , , , 2 9 9 9 7 7 7 8 8 1 1 1 4 4 4 4 5 5 , , , 3 2 9 8 1 0 6 1 5 8 9 9 , , , 0 1 9 0 4 7 4 9 5 , , , 3 0 3 8 3 7 9 5 1 9 9 96 6 5 7 9 4 , , , 1 6 9 2 6 1 2 2 7 1, 2 2 2 5 3 4 4 5 2 , , , 0 0 3 0 5 5 1 7 4 4 4 4 7 8 8 5 1 8 , , , 1 2 3 3 2 9 3 6 53 3 3 6 6 5 6 7 7 , , , 6 7 2 8 8 8 3 5 1 , , , 8 8 86 7 5 5 8 6 , , , 0 0 5 7 8 6 2 7 3 E C 5 5 6 1 8 0 , , , , , 2 3 2 2 5 88 8 5 77 6 2 2 2 2 8 88 8 5 31 ! 3 2, , , 3 ,9 , 9 6 3 3 69 8 9 9 8 3 3 3 8 9 8 9 6 6 , , , 0 0 5 0 9 1 7 5 52 2 2 5 5 5 6 5 4 , , , 8 1 3 2 2 5 1 5 8 , 0 0 6 7 0 8 3 5 , , 5 1 0 , 6 0 8 6 7 91 Sept. 11 18, 671, 299 132, 782 9,139,040 955,365 237,184491,324362, 253 , 877, 344652,910290, 767405,032255,838 071, 458 Sept. 18 18, 756,298 140, 011 9,183, 286 969, 284 243, 626496,497356, 669 905,130454,310 ~28~1.,, 742399,223 255,124 , 071,396 Sept. 25 1, 843,300 151, 977 9,165, 787 960, 771 255, 785 5"013,;617 149, 637 , 983, 843=57, 723 28t4, ;155 " 547 261,129 069, 329 Redemption fund — Federal Reserve notes: Aug. 21 11, 826 1,850 1,477 1,077 402 1,618 1,147 829 400 495 650 1,248 Aug. 28 11, 826 1,850 1,477 1,077 402 1,618 1,147 829 400 495 633 650 1,248 Sept. 4 ;__ 11, 398 1,802 1,280 993 1,000 1,123 1,111 733 383 486 620 640 1,227 Sept. 11 11, 397 1,802 1,280 993 1,000 1,123 1,111 733 383 485 620 640 1,227 Sept. 18 11, 398 1,802 1,280 993 1,000 1,123 1,111 733 383 486 620 640 1,227 Sept. 25 11,790 1,672 1,788 812 775 1,285 1,454 317 456 556 607 1,132 Other cash: Aug. 21 354, 056 31,485 95, 222 31, 706 23,131 24,1 20, 542 38, 04' 17, 645 8,104 19, 027 12, 987 32,080 Aug. 28 348, 390 31, 705 95,412 30, 241 22, 551 21, 680 19, 345 39, 972.17, 575 8,090 17, 648 14, 297 29, 874 Sept. 4 322, 814 29, 581 85, 611 22, 672 21, 409 20, 610 17, 773 36, 278 15,830 7,436 16, 552 12,314 29, 748 Sept. 11 340, 820 33,073 95, 414 29, 440 21, 251 20, 528 17, 876 39, 772 16, 366 7,' 16, 420 13,350 29,832 Sept. 18 344,387 35, 648 90,414 29,183 21, 646 23, 500 17, 987 38, 548 15, 924 7,326 18, 912 11,872 33,427 Sept. 25 347, 534 35, 541 95,390 28,053 21, 718 20, 969 16, 40,846 15, 696 7,182 18, 396 12, 354 34, 932 Total reserves: Aug. 21 18, 852, 860 178, 240 9,072, 070 000, 700 , 258, 535401, 093389, 474 903,963478,400 293, 997419,175 267,995 ,089, 219 Aug. 28 18, 922,194 178,866 9,105, 924 000,440 , 277, 305704, 431 * i, 773919, 36447766, 226622 229922 ,5 55544 4"0"4 ," 3"7 6271,768 , 104,129 Sept. 4 18, 965, 509 9, 231, 280 985, 327 , 264,466509, 959376, 5672, 893', 083 467,499 2902,6 "0" 4"03,179 268,079 , 099,141 Sept. 11 19, 023, 516 167, 657 9, 235, 734 985, 798 ,259,435112,975381, 240" 917, 851 469, 659 298, 754022,072 269,828 , 102, 517 Sept. 18 19,112,083 177,461 9, 274, 980 999,460 ,266, 272»21,120375, 767 944,411 470,617 289, 554418, 755 267,636 , 106,050 Sept. 25 19, 202, 624 , 189,1909, 262,965 ,278, 278•25,871367,030 026,143 473, 736 291, 7934'1"8",4 9""9" 274,090,105,393 Bills discounted: Secured by U. S. Government obligations, direct and guaranteed: Aug. 21 1,119 440 94 113 60 65 36 161 70 Aug. 28 1,229 680 74 113 60 10 50 31 151 40 Sept. 4 1,503 770 164 113 60 10 25 31 180 40 Sept. 11 980 360 134 123 60 12 10 46 175 40 Sept. 18 861 101 89 123 240 10 51 160 70 Sept. 25 860 226 129 133 50 2 30 65 150 70 Other bills discounted: Aug. 21 1,939 397 54 34 65 200 125 80 226 709 30 Aug. 28 2,619 1,200 85 34 198 100 66 211 71 Sept. 4 4,031 2,685 76 34 167 80 59 235 68 15 Sept. 11 4,258 2,993 115 34 143 80 41 223 614 15 Sept. 18 3,230 1,985 158 62 103 48 89 45 174 500 53 Sept. 25 - 3,722 2,310 162 72 167 62 92 97 210 471 61 Total bills discounted: Aug. 21 3,058 837 148 147 209 66 125 145 262 870 100 Aug. 28 3,818 1, 159 147 208 25 100 116 242 868 40 Sept. 4 5,534 3,455 240 14' 177 20 80 84 266 860 55 Sept. 11 5,238 3,353 249 157 155 20 80 51 269 789 55 Sept. 18 . . . 4, 091 2,086 247 185 253 115 53 89 55 225 660 123 Sept. 25 4,58! 2,536 291 20; 68 169 67 92 127 275 621 131 Industrial advances: Aug. 21 8,561 1,132 1,808 2,420 373 790 209 272 222 216 462 652 Aug. 28 8,553 1,127 1,805 2,419 375 790 208 27: 227 215 462 Sept. 4 8,645 1,127 1,"" " 2,397 375 850 267 271 223 215 463 Sept. 11 8,630 1,127 1,798 2,399 374 849 267 271 228 215 461 Sept. 18 8,612 1,098 1,778 2,395 373 839 267 271 275 215 460 Sept. 25 8,664 1,145 1,783 2,393 373 838 266 271 280 214 460 636 TJ. S. Government securities, direct and guaranteed: Bonds: Aug. 21 1, 319,196 96, 236 404, 294 104, 677 135, 286 66, 053 48, 383 139, 98' 61,076 38, 829 62, 345 51, 423 110, 607 Aug. 28 1, 319,196 96, 246 404,139 104, 660 135, 286 080 48, 389 140, 001 61,113 38, 84" 62,380 51,444 110, 611 Sept. 4 1, 318, 600 96, 222 403, 661 104, 577 135, 227 100 48, 380 139, 966 61,156 38, 864 62, 418 51, 459 110, 570 Sept. 11 1,318,600 96, 222 403, 661 104, 577 135, 227 100 48, 380 139, 966 61,156 38, 864 62, 418 51, 459 110, 570 Sept. 18 1, 318, 600 96, 222 403, 661 104, 57r 135, 227 100 48, 380 139,966 61,156 38, 864 62,418 51, 459 110, 570 Sept. 25 1, 318, 600 96, 222 403, 661 104, 57' 135, 227 100 48,380 139,966 61,156 38,864 62,418 51,459 110, 570 Notes: Aug. 21 1,126, 732 82,194 345,311 89, 406 115, 550 56, 416 41, 324 119, 562 52,166 33,165 53, 249 43, 920 94, 469 Aug. 28 1, 122, 458 81,892 343, 868 89,050 115, 111 56, 225 41,173 119,122 52, 00033, 054 53, 077 43, 771 94,115 Sept. 4 1,115, 000 81, 366 341, 335 88, 430 114,345 55,894 40,910 118, 353 51, 714 32, 863 52, 780 43, 513 93, 497 Sept. 11 1,115,000 81, 366 341, 335 88, 430 114, 345 55, 894 40, 910 118,353 51, 71432, 863 52, 780 43, 513 93,497 Sept. 18 1,115,000 81, 366 341, 335 88, 430 114, 345 55, 894 40, 910 118, 353 51, 71432, 863 52, 780 43, 513 93,497 Sept. 25 1,115,000 81, 366 341,335 88, 430 114, 345 55,894 40, 910 118, 353 51, 714 32, 863 52, 780 43, 513 93,497 Total U. S. Government securities, direct and guaranteed: Aug. 21 2, 445,928 178, 430 749, 605 194, 083 250, 836122, 469 89, 707 259, 549113, 24271, 994115, 59495, 343 205,076 Aug. 28 2,441, 654 178,138 748,00' 193, 710 250, 397122, 305 89, 562 259,123113,113 71,901115, 45795, 215 204, 726 Sept. 4 2, 433, 600 177, 588 744,996 193,007 249, 572121,994 89,290 258, 319112, 87071, 727115,198 94, 972 204, 067 Sept. 11 2, 433, 60C 177, 588 744, 996 193,007 249, 572121,99- 89, 290 258,319112,870 71, 727115,198 94,972 204,067 Sept. 18 2, 433, 60C 177, 588 744,996 193,007 249, 572121,994 89, 290 258, 319112,870 71, 727115,198 94,972 204,067 Sept. 25 2,433,60C 177, 588 744,996 193,007 249, 572121,994 89,290 258, 319112, 87071, 727115,198 94, 972 204,067 1104 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Reserve Banks—Continued [In thousands of dollars] Total Boston Y N o e r w k P p h d h i e i l l a - a- C l l a e n v d e- m Ri o c n h d - l A a t n - ta Chicago L S ou t. is n M o e l a i i n p s - - K C s a i a t n s y - Dallas F S r a an n - Assets—Continued Total bills and securities: Aug. 21 2, 457, 547 179, 586 752, 250 196, 651 251, 356123, 384 90,125 259,887113,372 72, 361116,072 96, 675 205, 828 Aug. 28 2, 454,055 179, 288 751, 672 196, 288 250, 919123,155 89, 978 259, 420113, 218 72, 244115, 914 96, 545 205,414 Sept. 4 2, 447, 779 178, 805 750, 255 195, 644 250,094122, 904 89, 734 258, 610112, 955 72,034115, 679 96, 295 204, 770 Sept. 11 2, 447, 468 178, 715 750,147 195, 655 250,103122, 903 89, 712 258, 610112, 955 72,006115, 682 96, 222 204, 758 Sept. 18. 2,446, 303 178, 686 195, 649 250,130123, 086 89, 672 258, 643112, 964 72,057115, 638 96,092 204,826 Sept. 25 2, 446,846 178, 733 749, 315 195, 691 250,150122, 900 89, 725 258, 657112, 967 72,134115, 687 96,053 204,834 Due from foreign banks: A A u u g g . . 2 2 8 1 4 4 ' 1 3 3 1 1 8 8 5 5 4 4 2 2 2 2 6 6 1 1 1 1 1 1 4 4 Sept. 4 47 3 18 5 4 2 2 1 1 1 4 Sept. 11 47 3 18 5 4 2 2 1 1 1 4 Sept. 18 47 3 18 5 4 2 2 1 1 1 4 Sept. 25 4' 3 18 5 4 2 1 1 1 4 Federal Reserve notes of other banks: Aug. 21 20, 041 1,108 1,829 1,136 1,672 2,502 1,891 1,951 1,755 1,189 2,193 376 2,439 Aug. 28 20, 812 8f" 2,161 1,104 1,310 3,421 2,048 2,550 1,659 1,085 1, 445 519 2,617 Sept. 4 21, 221 5: 1,924 759 1,843 3,112 2,149 2,714 1,578 1,739 1,935 469 2,422 Sept. 11 22, 962 2,673 1,085 1,421 3,343 1,406 4,197 1,682 618 2,220 522 2,807 Sept. 18 22, 412 640 2,999 979 1,787 2,542 1,77' 2,817 2,029 1,238 1,508 548 3,547 Sept. 25 22, 875 643 2,379 941 1, 748 2,795 1,76' 2,391 2,711 1,309 1,951 415 3,825 Uncollected items: Aug. 21 661, 319 61,100 160, 704 49, 520 75, 263 56, 924 23, 65' 92, 509 27, 279 18, 766 29, 632 23, 310 42, 655 Aug. 28 636, 584 57, 203 151, 216 45, 671 80, 844 50, 76223, 58! 89, 704 35, 269 17,142 28, 672 26, 502 30, 011 Sept. 4 663, 569 62, 556 141, 420 41, 547 78, 835 58, 911 28, 985 91, 237 40, 651 20, 005 33, 542 25, 907 39, 973 Sept. 11 706, 834 63, 389 162, 048 49, 494 87, 375 59, 343 23, 690 98, 871 38, 879 20, 817 33, 328 25, 270 44, 330 Sept. 18 851, 710 77, 815 201, 889 54, 606 99, 430 74, 560 34, 235 121, 598 45, 277 23, 935 35, 725 31, 272 51, 368 Sept. 25 . 694, 970 62, 321 161, 373 50, 798 80, 602 72, 285 25, 587 91, 763 36,333 22, 354 28, 245 25,483 37, 826 Bank premises: Aug. 21 41, 395 2,857 9,785 4,508 5,449 2,500 2,008 3,351 2,398 1,379 3,133 1,134 Aug. 28 41, 364 2,857 9,785 4,497 5,449 2,494 2,005 3,351 2,397 1,379 3,133 1,133 2,884 Sept. 4 41, 307 2,852 9,767 4,497 5,449 2,494 2,005 3,345 2,393 1,377 3,117 1,127 2,884 Sept. 11 41, 310 2,852 9,' 4,497 5,450 2,494 2,005 3,345 2,394 1,377 3,117 1,127 2,884 Sept. 18 41,310 2,852 9,' 4,497 5,450 2,494 2,005 3,345 2,394 1,377 3,117 1,127 2,884 Sept. 25 41,294 2,852 9,768 4,498 5,436 2,494 2,002 3,345 2,394 1,377 3,117 1,127 2,884 Other assets: Aug. 21 59, 326 4,090 17, 334 4,645 6,603 3,369 2,142 6,008 2,602 1,796 2,1 2,751 5,288 Aug. 28 60,191 4,152 17,650 4,715 6,706 3,420 2,159 6,124 2,613 1,807 2,740 2,777 5,328 Sept. 4 61, 230 4,201 17, 942 4,788 6,828 3,427 2,166 6,249 1,842 2,800 2,830 5,468 Sept. 11 65,117 4,283 18, 363 7,782 6,896 3,519 2,197 6,276 2,725 1,867 2,820 2,863 5,526 Sept. 18.. 52, 713 3,641 15, 257 4,264 5,897 2,992 1,877 5,303 2,277 1,584 2,364 2,538 4,719 Sept. 25 53, 547 3,704 15, 651 4,300 5,967 3,049 1,876 5,383 2,293 1,604 2,395 2,557 4,768 Total assets: Aug. 21 22,092, 5351, 426,984 10, 013, 990 1, 25176,51 615, 1, 598, 688891, 774509, 299 3, 267, 675 625, 807 389, 458782 ,5 7920,4 399024, 2421,348, 326 A S S S e e e u p p p g t t t . . . . 2 4 1 1 8 8 1 2 2 2 2 2 2 2 2 , , , , 1 3 5 2 3 0 2 0 5 6 7 0 , , , , 2 2 5 6 4 5 7 6 7 4 8 2 1 1 1 1 , , , , 4 4 4 4 2 2 1 4 5 3 7 1 , , , , 6 0 2 8 6 9 6 8 3 8 2 7 1 1 1 1 0 0 0 0 , , , , 1 1 2 5 0 7 5 2 3 8 3 , 8 , , , 6 7 7 0 4 5 7 2 6 1 1 6 1 1 1 1 , , , , 2 2 2 2 3 5 4 5 2 2 4 9 , , , , 5 4 7 3 6 6 2 1 7 0 0 6 1 1 1 1 , , , , 6 6 6 6 0 2 2 1 7 8 2 0 , , , , 5 9 5 6 1 7 3 8 9 0 9 4 78 5 7 6 0 7 0 7 2 8 0 09 9 6 7 4 , , , >5 5 " 0 6 0 7 " 0 1 8 9 " , , 5 6 6 2 5 2 5 5 5 0 5 5 0 0 2 8 2 5 36 , 3 , 3 3 ,3 3 , , ^ 5 3 2 , 5 33 2 82 32 5 5 89 8 5 3 9 3 1 0 , ,, , , 5 1 6 2 6 3 5 5 4 3 1 6 4 6 , , 6 9 2 , 6 , 6 82 6 1 2 8 3 2 7 2^ 1 3 , 9 , 25 6 7 4 9 3 1 6 35, 5 9 6 9 , 3 , 5 3 3 9 5 8 5 8 4' 5 6 7 3, 9 , , 5 4 3 2 2 3 8 51 5 5 5 5 , 9 5 6 5 7 6 1 7 0 , 6 9 0 5 , , , 5 7 72 25 2 9 2 4 8 4 5 6 ^ 5. 5 1 0 3 2 3 2. 5 83 3 3 3 4 7 9 9 1 9 9 ,0 7 9 4 4 5 , , , . , 3 189 7 2 7 5. 03 0 ' 4 0 83 8 ., 5 8 3 1 1 1 1 ,8 1 9 , , , 3 9 , . 3 3 , 3 3 3 5 3 5 7 6 4 2 5 4 3 2 1 0 , , , 6 , 5 66 3 8 3 26 9 2 8 2 8 6 7 Sept. 25 22,462, 2031,437,446 10,201,469 1,245,869 1,622,185 729,396 487,9893", 3"87~, 688 63"0, 435 390, 575169, 895 399, 7261, 359, 534 Liabilities Federal Reserve notes in actual circulation: Aug. 21 5,309, 939 433, 796 1, 418, 624 367, 293 I 232,147172,157 1,148, 821 198, 586 144, 776 192, 76683,162 430, 847 Aug. 28 5, 334, 240 436, 388 1,426,949 369, 546 489i,, 430 234, 391071, 500 1,150, 618 198, 700 145, 292 192, 34833,733 435, 351 Sept. 4 5, 390, 785 440, 799 1, 446, 938 371, 845 492,!, 015 237, 931573,025 1,159, 489 200,005 147,342 194, 49185, 292 441, 609 Sept. 11 5, 393, 924 440, 416 1,438, 694 372, 758 497',, 046 241,941772, 770 1,158, 238 199, 850 148,035 193, 72875,433 445,010 Sept. 18 5, 395, 924 440, 263 1,441, 879 372, 742 494, 545 242; 209173,080 1,161, 260 200, 296 148, 644 194,03685,816 441,154 Sept. 25 5, 406, 985 440,800 1, 443, 235 373, 972 497, 571 246,013173,012 1,162,404 200, 390 149,090 193, 87886,421 440,194 Deposits: Member bank —reserve account: Aug. 21 13,418,718 766, 791 7,158, 549 643, 932 834,429 307, 083 231,0401, 776, 375313, 255 161,045 275, 837 212, 557737, 825 Aug. 28 13, 515, 998 768, 930 7, 211,153 650, 295 855,423 308, 737 228,1681, 797,108 310^ 747163,176 269, 689 212,147 740,425 Sept. 4 13, 523, 861 790, 879 7,167, 891 652, 499 867,320 321, 052 231, 6961, 789,007 309, 593 163,080 27)0, i373 219, 472 740, 999 Sept. 11 13, 595, 824 794, 241 7,155,415 658, 995 884,078 323, 830 230, 5911, 825, 621314,191165, 045 281, 733214, 626 747, 458 S S e e p p t t . . 1 2 8 5 1 1 3 3 , , 7 6 0 2 3 4 , ,4 1 1 1 9 2 7 7 8 9 9 7 , , 4 2 5 7 5 6 7 7 , , 1 2 8 2 8 5 , , 1 1 8 9 2 4 6 65 6 1 0 , , 6 7 5 5 4 0 8 87 6 1 7 , , 4 3 9 8 8 1 3 32 2 9 5 ^ , 6 2 3 9 6 7 2 2 1 2 "9 6 , , 3 6 3 5 8 7 1 1 , , 9 8 1 5 1 1 , , 4 2 2 6 5 3 3 41 1 0 3 , , 7 6 5 7 7 9 1 1 5 5 9 9 , , 4 3 0 3 1 3 2 2 7 7 2 2 ,, ,4 40 9 06 9 6 9 22 1 2 14 1 4, 2 , 9 8 7 5 28 7 7 4 4 8 7 , , 5 7 1 2 4 2 U. S. Treasurer—general account: Aug. 21 889, 274 72, 450 329, 859 55, 435 81, 498 41, 725 35,018 88,633 42, 228 34, 576 38,254 34, 865 34, 733 Aug. 28 813, 094 66, 374 299, 588 40,188 80, 032 39, 855 34, 859 81,132 41, 200 29,109 29, 818 36, 651 34, 288 Sept. 4 791,182 54, 986 301, 575 42,071 69,133 37, 479 29, 759 82, 376 39, 814 30, 725 32, 344 31,116 39, 804 Sept. 11 761, 686 41, 681 315, 348 36, 699 43, 074 34,193 32, 826 73, 809 36, 683 35, 864 38, 894 37, 961 34, 654 Sept. 18.. 790,361 46, 529 294,474 47,901 65,185 39,847 30, 704 75,432 40, 752 33, 854 36, 343 37, 298 42, 042 Sept. 25 792, 532 62, 996 277,478 45,169 72, 315 34,813 29, 358 83,904 40, 097 33,449 34, 770 38, 294 39, 889 Foreign: Aug. 21 867, 059 61, 940 308, 332 84, 960 80, 625 37, 278 30, 343 104,033 26,008 19,073 25,141 26, 008 63, 318 Aug. 28 990, 660 63,104 417, 658 87, 201 82, 751 38, 261 31,143 106, 776 26, 694 19, 57625, 804 64, 998 Sept. 4 997, 516 46, 262 569, 876 65, 219 61, 892 28, 617 23, 293 79, 860 19, 965 14, 641 19, 300 19, 965 48, 626 Sept. 11 956, 537 46,171 532, 943 64, 548 61, 255 28, 322 23,053 79, 039 19, 760 14, 490 19,101 19,760 48,095 Sept. 18 1,035,459 46, 355 608, 840 65,034 61, 716 28, 535 23, 227 79, 634 19, 908 14, 600 19, 245 19,908 48, 457 Sept. 25 1,011,324 47, 582 574, 626 66, 544 63,149 29,198 23, 766 81, 482 20, 370 14, 938 19, 691 20, 371 49, 607 Other deposits: Aug. 21 618, 466 7,777 529, 482 24, 095 7,165 1,145 4,908 9,622 6,950 4,304 1,156 1,839 20, 023 Aug. 28 507,088 7,454 415, 663 27, 685 5,447 1,185 5,072 8,514 7,319 4,533 1,061 2,708 20, 447 Sept. 4 512, 525 7,762 418, 412 27, 630 5,628 3,792 5,111 9,101 7,155 4,194 697 20, 554 Sept. 11 563,403 8,536 463, 429 27, 950 3,454 5,254 8,504 7,435 3,702 5,260 2,347 20, 883 Sept. 18 513, 309 8,095 414,052 25, 595 6,525 3,298 4,926 8,150 7,C" 3,638 9,263 2,160 20,001 Sept. 25 513, 645 10, 554 407, 453 25,368 3,178 4,622 7,860 7,553 4,096 11, 853 3, 052 19,410 * Less than $500. OCTOBER 1940 1105 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Federal Reserve Banks—Continued [In thousands of dollars] Total Boston Y N o e r w k P p d h h e i i l l a a - - C la le n v d e- m R o ic n h d - la A n t t - a Chicago Lo S u t i . s n M o e l a i i n p s - - K C s a i a t n s y - Dallas F c S i r s a a c n n o - Liabilities—Continued Deposits— Continued Total deposits: Aug. 21 15, 793, 51 908, 958 8, 326, 222 808, 4221, 003, 717 38'7,, 231 301, 309 1, 978, 663 388, 441 218,3 94908, 388275, 269 855, 899 Aug. 28 15, 826, 840 905, 862 8, 344, 062 805, 3691, 023, 653 388, 038 2i9,9 ,242 1, 993, 530 385, 960 216, 339246, 372278, 200 860,158 Sept. 4 15, 825,084 899, 889 8, 457, 754 787, 419I, 003, 973 39i0,, 940 289, 859 1, 960, 344 376, 527 212, 634202, 714273, 042 849, 983 Sept. 11 15, 877, 450 890, 629 8, 467, 135 788, 192 995, 056 389, 799 291, 724 1, 986, 973 3 344, 988 274; 851, 090 Sept. 18 15, 963, 548 898, 434 8, 505, 548 799,1841, 004, 807 396, 977 285, 5124,014, 480 378, 945 211, 493337, 850272,094 858, 222 Sept. 25 16,020, 613 910, 408 8, 484, 751 788,8311, Oil, 608 396, 825 277, 084 2, 084, 637811, 777211,816338, 720276, 702 857, 420 Deferred availability items: Aug. 21 623, 548 58, 964 144, 266 74, 092 54, 728 22, 637 94,125 27, 475 16, 266 28, 948 22, 235 34, 722 Aug. 28 611, 024 55, 703 142, 372 44, 392 75, 322 49, 552 22, 589 90, 208 35, 415 15, 058 26,720 25, 711 27, 982 Sept. 4 621, 720 59, 661 122,842 39, 905 77, 391 56, 244 25, 510 89, 280 39, 887 17,817 32, 259 24, 780 36,144 Sept. 11 669, 184 61, 505 147,611 46, 979 84, 370 57, 11222, 522 97, 731 39,005 18,826 29, 706 24,079 39, 738 Sept. 18 803, 296 77,151 181,021 53, 905 95, 399 71,1 33, 507 114,180 44, 951 20,144 34, 424 29, 678 47, 046 Sept. 25 670,157 60, 928 147, 959 49, 365 78, 745 70, 816 24,645 94,342 36, 873 20,180 26, 465 24,952 34,887 Other liabilities, including accrued dividends: Aug. 21 2,896 418 760 279 304 68 130 302 97 128 150 113 147 Aug. 28 3, 284 435 863 319 314 101 144 348 129 152 184 132 163 Sept. 4 2,853 448 678 287 292 81 131 290 95 136 120 120 175 Sept. 11 6, 129 461 861 3,078 353 106 147 360 112 148 138 139 226 Sept. 18 3,137 367 835 309 350 89 143 342 96 139 129 132 206 Sept. 25 3,653 399 1,012 366 368 120 156 405 112 159 152 153 251 Total liabilities: Aug. 21 21, 732, 8981, 402,1369, 889, 8721,224,082 565, 077)74,174*96, 233 13,.221,911514, 599 3801,,168562, 252380, 779 , 321, 615 Aug. 28 21, 775, 3881, 398, 3889, 914, 246I, 219, 626 588,719372, 081493, 4753, 234, 704820, 204376, 896545, 619387, 7761, 323, 654 Sept. 4 21, 840, 4421, 400, 79710, 028, 2121,199, 456 573, 671685, 200 488', 5235, 209, 403" 5 1\6 5;14377, 935549, 584383, 2341,327,911 Sept. 11 21,946, 6871,393,01110,054, 3011,211,00' 576, 825 5, 964487,1633, 243, 302817, 036 "318,6.110568, 559384, 3451, 336, 064 Sept. 18 22,165, 9051,416,21510,129, 2831, 226,140 595,101711,165 449922,, 2244443, 290, 262 624, 288 3810,4i20566,439 "38"7",720 1, 346, 628 Sept. 25 22,101, 4081, 412, 53510,076, 9571, 212, 534 588, 297 713, 774474,897 3;,, 341, 826219,152381, 245559, 215 388, 2281, 332, 752 Capital Accounts Capital paid in: Aug. 21 137, 562 9,333 51, 075 11, 880 14, 059 5,330 4,669 13, 910 4,154 2,960 4,416 4,139 11,637 Aug. 28 137, 582 9,332 51,075 11, 880 14, 059 5,337 4,673 13, 914 4,154 2,952 4,422 4,139 11,645 Sept. 4 137, 586 9,332 51, 075 11, 880 14, 058 5,337 4,673 13, 918 4,154 2,951 4,422 4,140 11, 646 Sept. 11 137, 620 9,332 51,081 11, 880 14, 061 5,339 4,678 13, 920 4,154 2,952 4,422 4,151 11, 650 Sept. 18 137, 637 9,332 51, 070 11, 883 14,062 5,340 4,679 13,925 4,164 2,952 4,423 4,156 11,651 Sept. 25 137, 630 9,333 51,046 11, 889 14,068 5,339 4,680 13, 927 4,164 2,952 4,423 4,156 11,653 Surplus (section 7): Aug. 21 151, 720 10, 405 53,326 14,198 14,323 5,247 5, 725 22,824 4,709 3,152 3,613 3,974 10, 224 Aug. 28 151, 720 10, 405 53, 326 14,198 14, 323 5,247 5,725 22, 824 4,709 3, 152 3,613 3,974 10, 224 Sept. 4 151, 720 10, 405 53, 326 14,198 14, 323 5,247 5,725 22, 824 4,709 3,152 3,613 3,974 10, 224 Sept. 11 151, 720 10, 405 53, 326 14,198 14, 323 5,247 5,725 22, 824 4,709 3,152 3,613 3,924 10, 224 Sept. 18 151, 720 10, 405 53,326 14,198 14,323 5,247 5,725 22, 824 4,709 3,152 3,613 3,974 10,224 Sept. 25 151, 720 10, 405 53, 326 14,198 14,323 5,247 5,725 22, 824 4, 709 3,152 3,613 3,974 10,224 Surplus (section 13b): Aug. 21 26, 839 2,874 7,109 4,: 1,007 3,246 713 1,429 538 1,001 1,142 1,266 2,121 Aug. 28 26, 839 2,874 7,109 4,393 1,007 3,246 713 1, 429 538 1,001 1,142 1,266 2,121 Sept. 4 26, 839 2,874 7,109 4,393 1,007 3, 246 713 1,429 538 1, 001 1,142 1, 266 2,121 Sept. 11 26, 839 2,874 7,109 4,393 1,007 3,246 713 1, 429 538 1,001 1,142 1,266 2,121 Sept. 18 26, 839 2,874 7,109 4, 393 1,007 3,246 713 1,429 538 1,001 1,142 1,266 2,121 Sept. 25 26, 839 2,874 7,109 4,393 1,007 3,246 713 1, 429 538 1,001 1,142 1,266 2,121 Other capital accounts: Aug. 21 43, 516 2,236 12, 608 2,612 4,415 1,777 1,959 7,601 1,807 2,207 1,481 2,084 2,729 Aug. 28 43, 718 2,263 12, 670 2,623 4,431 1,774 1,967 7,648 1,814 2,210 1,485 2,090 2,743 Sept. 4 44, 075 2,255 12, 884 2, 640 4,460 1,779 1,972 7,670 1,851 2,218 1,492 2,094 2,760 Sept. 11 44, 388 2,265 12, 934 2,838 4,468 1,783 1,973 7,681 1,858 2,220 1,504 2,097 2,767 Sept. 18.. 44, 477 2,272 12, 983 2,846 4,477 1,798 1,974 7,683 1,860 2,220 1,491 2,099 2,774 Sept. 25 44, 606 2,299 13, 031 2,855 4,490 1,790 1,974 7,685 1,872 2,221 1,502 2,102 2,784 Total liabilities and capital accounts: Aug. 21 22, 092, 5351, 426, 98410, 013, 9901, 257,1651, 598, 881 19, 774509, 299 3, 267, 675 625, 807389, 488572, 904392, 242 1, 348, 326 Aug. 28 22,135, 2471, 423, 26210,038, 426 .I!, 252, 7210, 622, 539 687, 685 506, 5533,280,519 631,419 386i;, 211556, 281399, 2451,350, 387 Sept. 4 22, 200, 6621, 425, 66310,152, 606 ", 232, 5671, 607, 519 700, 809 501, 608 3, 255, 244 627, 766 '3,8275!7560, 253394, 7081, 354, 662 Sept. 11 22, 307, 2541, 417,88710,178, 7511, 244, 3161, 610, 684 704, 579 500, 252 579, 240395, 8331, 362, 826 Sept. 18 22, 526, 5781,441,098 10,253, 7711, 259,4601,628,970 726,796 505,335 577,108 3991,,2151, 373,398 Sept. 25 22,462, 2031,437,44610,201., ," "46:9 ,1 245, 8619, 622,185 729, 396 487, 989 3', 387, 688 630', 435 390;569, 895 3991,,7261, 359, 534 Commitments to make industrial advances: Aug. 21 8,241 260 742 1,034 689 510 374 144 3,294 Aug. 28 8,238 260 741 1,034 701 510 374 144 3,282 Sept. 4 8,192 260 740 1,034 699 510 369 144 3,257 Sept. 11 8,123 260 740 1,032 645 510 369 144 3,243 Sept. 18 8,007 260 737 1,032 651 510 368 144 3,162 Sept. 25 8,078 356 733 1,029 651 510 136 3,144 1106 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDUSTRIAL ADVANCES BY FEDERAL RESERVE BANKS [Amounts in thousands of dollars] Repaid, Date ( e la a s c t h W m e o d n n th es ) day of Ap r p ec li e c i a v t e i d ons Ap c p o li n c s a i t d io er n a s t i u o n n der A a p p p p li r c o a v ti e o d ns A st d a v n o a d u n i t n - c g es 1 C st m o a o m n e u d n m t i - t n s i g t- A p b p l u c p e o t t r m e o n d v - o e » t d d o e r r x a a p p w w p ir n i l e t i - d h b , - y s P p ta a a o n t r u i t d o i t i - c n n i s - g3 (amount) (amount) (amount) cant, etc. (amount) Number Amount Number Amount Number Amount (amount) 1934—Dec. 26... 4,386 146,972 2,955 49,634 13, 589 8,225 20,966 5,558 1,296 1935—June 26... 6,325 237, 581 11,349 1,646 88, 778 27, 518 20, 579 11,248 24,900 4,533 Dec. 31 *_. 7,437 293,084 2,823 1,993 124, 493 32,493 27, 649 11,548 44,025 8,778 1936—June 24... 8,006 314,471 1,880 2,183 133, 343 30,484 24, 454 9,381 61,425 7,599 Dec. 30___ 8.247 328, 998 1,245 2,280 139, 829 25, 526 20, 959 8, 226 77,910 7,208 1937—Mar. 31... 8,344 333, 300 1,322 2,323 141, 545 23,059 18,611 7,898 85,210 6,767 June 30— 8,430 339, 509 1,263 2,361 145, 758 23.019 16,331 1,470 97, 663 7,275 Sept. 29__. 8.474 341,842 800 2,381 146, 724 21,415 14, 880 537 102, 588 7,304 Dec. 29... 8,534 350,551 550 2,406 150,987 20, 216 12, 780 3,369 107, 384 7,238 1938—Mar. 30__. 8,708 1,299 2,464 154,918 19. 371 13, 110 3,419 111, 193 7,825 June 29... 8,976 369, 583 476 2,566 161, 158 18. 444 13, 649 3,084 117,555 8,426 Sept. 28. _. 9, 102 378,974 146 2,617 168, 380 17, 567 13, 597 5, 737 122,447 9,032 Dec. 28— 9, 188 387, 490 247 2,653 175,013 17, 345 14, 161 1,946 128,839 12, 722 1939—Jan. 25___. 9,203 389,176 999 2,660 175, 651 16,811 13,004 1,293 132.009 12, 534 Feb. 21«_. 9,221 389, 554 964 2,671 175, 902 16, 474 12.907 1, 105 133,001 12,415 Mar. 29__. 9,249 392, 230 344 2,683 177, 895 15, 798 12,647 1,975 135,004 12,471 Apr. 26... 9,270 394,055 495 2,697 178, 639 15,817 11,719 2, 134 136,696 12, 243 May 31... 9,296 394,970 400 2,713 179, 332 15, 305 11, 530 2,496 137,922 12,079 1940— J J J A J A S N A S M O F M D J u u u u e e e a u e u p o c n n l l a a b p p n c y t y g g r v y e r e . . . . t t . . . . . . . 2 2 3 3 2 2 2 2 2 2 2 3 2 2 2 2 8 1 1 6 6 4 5 8 9 7 8 0 _ 9 7 5 7 . _ — — — . _ _ _ . . . . . . . . _ . . _ . . . . . . _ s . . . . . . . . . . . _ 9 9 9 9 9 9 9 9 9 9 9 9 9 9 9 , , , , , , , , , , , , , , , 4 5 5 4 5 4 4 4 4 3 3 3 3 0 1 1 5 5 0 7 8 5 3 8 6 3 5 5 1 2 4 8 6 3 4 6 6 7 3 8 6 0 5 6 6 4 4 4 4 4 4 3 4 4 4 4 4 3 4 4 tO 1 1 1 0 0 9 0 1 0 1 9 1 1 0 0 7 3 5 7 5 1 5 9 0 4 3 2 6 1 2 6 , , , , , , , , , , , , , , , , 1 4 6 0 2 2 5 2 6 9 3 2 3 1 4 7 5 2 9 7 6 9 4 2 2 4 9 9 2 0 9 8 4 8 7 8 6 0 9 8 6 4 2 2 5 5 9 0 2 7 4 5 3 1 1 4 6 5 7 3 9 3 4 7 4 3 9 1 7 7 1 4 0 5 0 2 2 2 1 6 5 3 9 8 0 6 0 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 , , , , , , , , , , , , , , , , 8 7 8 8 7 7 7 8 7 7 8 7 8 7 8 8 1 3 2 5 5 7 3 2 4 6 9 6 0 3 8 5 4 0 5 3 2 2 2 1 3 3 3 5 5 8 1 6 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 8 9 8 9 8 8 9 9 9 9 8 8 9 8 7 9 5 2 3 5 7 0 5 6 8 4 8 4 7 8 9 7 , , , , , , , , , , , , , , , , 0 0 9 2 8 1 4 7 9 3 2 2 0 6 4 7 3 9 2 6 7 5 3 7 0 5 3 5 0 6 5 3 4 6 2 6 9 2 9 8 6 4 4 7 4 5 5 9 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 0 2 4 3 5 0 2 2 5 4 0 1 2 4 4 0 , , , , , , , , , , , , , , , . 0 9 9 4 2 6 7 6 3 2 8 5 7 0 9 7 5 0 9 5 6 4 7 8 8 0 4 6 5 7 2 8 1 7 7 4 7 2 9 3 4 1 5 0 5 8 3 8 1 1 1 1 1 0 1 8 8 8 8 9 9 8 8 8 8 8 1 1 0 , , , , , , , , . , , , . , , , 3 9 7 2 6 4 7 2 0 8 5 0 1 1 2 5 7 7 6 2 4 1 2 0 2 6 5 7 5 7 3 8 6 7 9 6 6 4 5 3 0 2 2 8 6 5 8 2 2 2 2 2 2 2 2 2 1 1 1 2 2 1 1 , , , , , , , , , , , , , , , 0 4 7 1 2 4 7 2 5 4 3 9 6 0 5 6 7 9 6 2 5 9 3 3 1 6 7 0 5 9 4 9 1 7 4 0 4 5 8 3 5 4 4 4 9 5 8 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 5 5 5 4 5 6 3 4 4 5 4 6 6 4 6 6 4 5 8 2 9 9 7 6 9 1 8 1 4 4 2 5 , , , , , , , , , , , , , , , , 2 4 9 1 6 0 0 9 8 8 6 6 5 1 9 9 8 9 1 5 7 3 4 6 4 1 1 2 7 1 4 5 1 1 1 6 9 7 6 5 9 2 2 9 4 0 3 0 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 0 2 0 1 1 1 0 2 2 1 2 0 1 1 1 1 , , , , , , , , , , , , , , , , 9 1 0 1 3 1 0 5 8 4 5 1 1 7 0 9 5 2 1 8 4 0 6 1 1 4 3 6 3 4 8 0 6 9 0 2 5 4 4 0 8 4 2 9 7 9 1 0 » Includes industrial advances past due 3 months or more which are not included in industrial advances outstanding in weekly statement of condition of the Federal Reserve Banks. 2 Includes applications approved conditionally by the Federal Reserve Banks and under consideration by applicant. 3 Does not include financing institution guaranties of advances and commitments made by Federal Reserve Banks, which amounted to $929,978 September 25, 1940. 4 Tuesday. 5 Latest date for which figures are available. FEDERAL RESERVE NOTES—FEDERAL RESERVE AGENTS' ACCOUNTS, BY WEEKS [In thousands of dollars] Total B to o n s- York P p d h h e i l i l - a a- C la le n v d e m Ri o c n h d - lanta C ca h g i o - L S ou t. is n M o e l a i i n p s - - K C s a a it n s y - Dallas F c S r i a s a n c n o - Federal Reserve notes: Issued to F. R. Bank by F. R. agent: Aug. 28 5, 623, 589453, 5571, 509, .606 388, 703 510, 325 2510,1,25185, 979 1.180, 208 209, 377149, 406 202, 662 91, 237 492, 404 Sept. 4 5, 639,131452, 2611, 516, 656 38'7,,009 512,11 251,137186, 479 1',185, 372208,497152, 098 202,016 91, 522 493, 969 Sept. 11 5, 688, 926457, 7581, 524,027 3891,,172 517, 959 256J 929 1877,' 432 1,190' 509 210J 153,117203,340 •" 504,392 Sept. 18 5, 692, 745455, 0971, 522, 275 390I,, 259 520, 797 256, 574187,930 1, 192, 094211, 174153, 566202, 301 93, 406 507, 272 Sept. 25 : 5, 703, 707460, 9741, 525, 517 38!8,, 095 519, 685 260,058187, 7551,191, 992211, 650154, 1'5"9' 204, 810 95, 345 503, 667 Held by Federal Reserve Bank: Aug. 28 289, 349 17,169 82, 657 19,157 20, 895 15, 73514, 479 29, 590 10,67 4,114 10, 319 7,504 57, 053 Sept. 4 248, 346 11, 462 69, 718 15,164 20,100 13, 20213, 454 25, 883 8, 492 4, 756 7,525 6,230 52, 360 Sept. 11 295,002 17, 342 85, 333 16, 414 20, 913 14, 982 14, 662 32, 271 10, 957 5,082 9,613 8,051 59, 382 Sept. 18 296, 821 14,834 80,396 17, 517 26, 25214, 365 14,850 30,834 10,878 4,922 8, 265 7,590 66,118 Sept. 25 296, 722 20,174 82, 282 14,123 22,109 14, 04; 14,743 29, 588 11, 260 5,069 10, 932 8,924 63, 473 In actual circulation: * Aug. 28 5, 334, 240436, 3881, 426, 949 369,546 489, 430 234,,390171, 5001,150, 618 198, 700 145, 292 192, 34383, 733 435, 351 Sept. 4 5, 390, 785440, 7991,446,938 371,8"•4"5" 4'9"2",{,015237, 935173, 025 '1.., 159, 489 200, 005 147, 342 194, 49851, 292 441L,,' 609 Sept. 11 5, 393, 924440, 4161, 438, 694372, 758 497, 046241, 94"172, 770 1',158, 238 199, 850 148, 035 193, 72785. 433 4455,, 0(10 Sept. 18 5, 395, 924440,2631,441, 879 372, 742 49"4'!,545242, 209 173,080 1, 161, 260 200, 296 148, 644 194,03685,816 441,154 Sept. 25 5, 406, 985440,800 i; 443', 235 373;972 497, 576 246\^ 013173, 0121, 162, 404 200, 390 149, 090 193, T~"16,421440,194 Collateral held by agent as security for notes issued to bank: Gold certificates on hand and due from U. S. Treasury: Aug. 28 5, 723, 000460, 0001, 525, 000 390, 000 511, 500 275,000190, 0001, 200, 000 219,000 150, 500 205, 000 93, 000504, 000 Sept. 4 5, 739, 500460, 0001, 535,000 390, 000 515,000 275, 000190, 0001, 200, 000 219,000 152, 500 205,000 94,000 550044, 000 Sept. 11 5, 790,000470,0001, 535,000 400,000 521, 500 2750,00 190,0001, 210,000 219,000 154, 500 205,000 96,000 514,000 Sept. 18 5, 796, 500470,000 1, 535,000 400,00052i; 500 275,000 190,0001, 210,000 219,000 154, 500 205,000 97, 500 519,000 Sept. 25 5, 806, 500470,000 1', 545,000400,000 521, 500 275, 000190,0001, 210, 000 219, 000 154, 500 205,000 97, 500 519,0C0 Eligible paper: . Aug. 28 2,53' 1, 155 100 105 234 Sept. 4 4,200 3,405 240 67 258 Sept. 11 3,844 3,153 249 60' 42 260 Sept. 18 2,744 1,958 218 240 40 208 Sept. 25 3,079 2,361 251 50 83 254 Total collateral: Aug. 28 5, 725, 537460,0231, 526, 860 390,155 511, 500 275i,,060190,000 1, 200, 000 219,100 150, 605 205, 234 93,000 5044,,000 Sept. 4 5, 743, 700460,090 1, 538, 405 390, 240 515,000 275i,,006600 1901,,000 1, 200, 000 219, 080 152, 567 205, 25894,000 5044,,000 Sept. 11 5, 793, 844470,"" .,"• "5"3 8',"153400, 249 521,500 275>,,060190, 000 1, 210,000 219,080 154, 542 205, 260 96,000 5144,,000 Sept. 18 5, 799, 244470, 000 1., 536, 958 "410,02,18 521,500 275,>' ,2 4204 0190, 000 1, 210, 000 219, 080 154, 540 205, 20897, 500 51990,000OO Sept. 25 5, 809, 579470,0001, 547, 361400, 251521, 500 275i,,050190,000 1, 210,000 219,080 154, 583 205, 254 97, 500 519,000' i Includes Federal Reserve notes held by the United States Treasury or by a Federal Reserve Bank other than the issuing bank. OCTOBER 1940 HOT Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

RESERVE POSITION OF MEMBER BANKS, AUGUST, 1940 MEMBER BANK RESERVE BALANCES BY CLASSES OF BANKS [Averages of daily figures. In millions of dollars] [Averages of daily figures. In millions of dollars] Cl a a n s d se s d i o s f t r b ic a t n s ks m p G o d d a r s e e o n - i - s t d s s p m o N d d s a e e i e n - - t t s d i p T o d i e s m - it e s R F e R e - d e e se r B a rv a l e n R s k e s w se i r th v E e x- b m a b A e n e m l k r l s - 1 C Y N e c o e n i w r t t k r y a l b r a e n c C s k a e h s g r i- o ve b s c a e R i r n e t v y - k e s b C a t o n r u k y n s* quired Held cess Total reserves held: 1939—August 10,659 5,366 923 2,883 1,486 All member banks. _39,857 32, 962 12,086 7,001 13,408 6,407 September 11,443 5,866 1,009 3,009 1,559 Central reserve city banks: October 11,862 5,958 1,112 3,203 1,588 New York. 15,161 14, 617 795 3,365 6,709 3,344 November 11,688 5,759 1,115 :,585 Chicago 3,110 2,771 505 656 1,154 499 December 11,473 5,623 1,141 3,141 ^,568 1940—January 11, 985 6,099 940 3,319 .,628 Reserve city banks: N February ._. 12, 215 6,323 901 3,344 ,646 Boston district 1,341 1,223 85 218 553 334 March ..... 12,362 6,428 899 3,368 .,668 New York district 237 185 152 40 61 21 April 12, 703 6,548 972 3,476 ,706 Philadelphia district.. 1,429 1,205 225 222 462 240 May 13,086 6,660 1,097 3,615 .,714 Cleveland district 1,874 1,490 737 298 676 378 June... 13, 596 6,941 1,182 3,716 .,757 Richmond district 859 632 224 122 204 82 July 13,735 6,979 1,168 3,837 ,751 Atlanta district 789 552 179 106 150 44 August 13,408 6,709 1,154 3,804 ,740 Chicago district 1,469 1,033 609 211 370 159 Week ending (Friday): St. Louis district 891 677 175 127 233 106 1940—Aug. 9 13, 326 6,676 1,136 3,766 ,747 Minneapolis district... 425 290 87 55 93 38 Aug. 16 13,349 1,146 3,782 ,740 Kansas City district... 1,076 698 158 130 204 74 Aug. 23 13, 438 6,715 1,165 3,818 .,739 Dallas district. 768 466 129 88 137 49 Aug. 30 13, 530 6,756 1,185 3,848 ,741 San Francisco district- 2,419 1,945 1,983 439 662 222 Sept. 6 13, 541 6,704 1,186 3,873 ,778 Sept. 13 13, 592 6, 655 1,209 3,922 .,807 Total 13, 578 10, 395 4,744 2,056 3,804 1,748 Sept. 20 13, 665 6,706 1,241 3,910 Excess reserves: Country banks: 1939—August 4,607 2,587 363 1,046 611 Boston district— 977 689 564 111 216 105 September _ 5,198 2,943 430 1,147 678 New York district 1,427 1,023 1,420 194 406 212 October 5,490 2,974 518 1,295 704 Philadelphia district.. 711 461 880 99 188 89 November 5,259 2,753 516 .,294 696 Cleveland district 671 433 712 88 161 73 December 5,011 2,611 540 ,188 671 Richmond district 591 354 370 61 102 41 1940—January.. 5,464 3,045 342 ,350 727 Atlanta district 542 329 241 51 81 30 February 5,626 3,199 301 ,378 747 Chicago district 959 574 773 108 241 134 March 5,734 3,248 310 ,405 771 St. Louis district 400 249 247 42 71 29 April 6,003 3,312 388 ,494 809 Minneapolis district- 339 203 279 38 68 29 May 3,389 477 ,607 815 Kansas City district.._ 473 291 160 42 69 26 June 3,594 547 ,703 851 Dallas district ._ 548 343 105 46 78 31 July 6,752 3,588 522 ,803 839 San Francisco district. 370 232 291 42 59 17 August 6,407 3,344 499 ,748 816 Week ending (Friday) : Total 8,008 5,180 6,042 924 1,740 816 1940—Aug. 9 6,345 3,316 484 ,720 824 Aug. 16. 6,371 3,334 491 ,729 817 Aug. 23 6,435 3,352 508 ,759 815 i Gross demand deposits minus demand balances with domestic banks Aug. 30 6,495 3,374 525 ,780 817 (except private banks and American branches of foreign banks) and Sept. 6 P6, 517 3,337 525 ,802 P854 cash items in process of collection. Sept. 13 P6, 547 3,283 544 ,837 P882 NOTE.—See table at foot of p. 1102 for percentages of deposits required Sept. 20 P6, 596 3,314 575 ,823 P883 to be held as reserves. p Preliminary. i Weekly figures of excess reserves of all member banks and of country banks are estimates. DEPOSITS OF MEMBER BANKS IN LARGER AND SMALLER CENTERS [Averages of daily figures. In millions of dollars] Member banks in larger centers Member banks in smaller centers J \.ll member banks (places over 15,000) (places under 15,000) Federal Reserve district Gross demand Time Gross demand Time Gross demand Time Aug. July Aug. July Aug. July Aug. July Aug. July Aug. July Boston 2,318 2,283 648 646 2,175 2,146 517 516 143 137 131 130 New York _ 16,826 17,012 2,368 2,339 i 1,345 1 1,329 i 1,067 11,063 319 309 505 502 Philadelphia 2,140 2,139 1,106 1,105 1,887 1,893 648 648 254 247 457 457 Cleveland 2,546 2,541 1,449 1,441 2,296 2,293 1,135 1,128 250 248 314 314 Richmond 1,451 1,452 594 590 1,255 1,256 392 385 196 196 202 205 Atlanta 1,331 1,351 420 421 1,162 1,183 329 330 168 169 91 91 Chicago . 5,538 5,488 1,887 1,881 i 2,063 i 2,057 i 1,062 i 1,059 366 360 320 316 St. Louis 1,291 1,298 422 420 1,052 1,059 302 301 239 239 120 119 Minneapolis 764 762 366 366 566 566 177 177 197 196 189 189 Kansas City _ .. . . 1,549 1,544 318 318 1,202 1,201 202 202 347 343 116 116 Dallas 1,316 1,332 234 235 1,013 1,029 187 188 303 303 47 47 San Francisco 2,789 2,751 2,274 2,283 2,662 2,625 2,169 2,179 127 126 105 104 Total 39,857 39,955 12,086 12,045 118,678 118, 637 i 8,187 i 8,175 2,909 2, 873 2,599 2,591 i Excluding central reserve city banks, for which figures for latest month are shown in table above. 1108 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

KINDS OF MONEY IN CIRCULATION [Outside Treasury and Federal Reserve Banks. In millions of dollars] End of month Total c c G e a r o t t i e l f d s i- d S o i l l l v a e r r s c S c e i a r l t t v i e f e s i r - o T n f r u o e r t 1 a y 8 e s s 9 - 0 S s u c i i b o a l s i r v i e n y d r - M c i o n i o n r U S n n t o a i t t t e e e s s d R F n e e o d se t e e r r s v a e l R F B n e e o d s a e t e n e r r k s v a e l t n b i N o o a n t n a e - a k s l 1939—July 7,049 L,446 362 156 264 4,496 184 August 7,171 L, 465 365 157 267 4,595 182 September. 7,293 L,488 159 269 4,688 180 October. __ 7,342 1,485 373 161 267 4,739 178 November. 7,483 1,530 379 163 269 4,826 177 December. 7,598 L, 554 164 272 4,912 175 1940—January... 7,376 L,469 372 163 265 4,796 173 February.. 7,455 ^,500 373 163 271 4,839 171 March 7,511 .,508 375 164 260 4,896 170 April 7,559 ^,557 377 166 248 4,906 168 May 7,710 ,590 382 168 241 5,025 167 June 7,848 ,582 384 169 248 5,163 165 July 7,883 L, 565 386 172 249 5,212 164 August 8,059 .,605 389 174 258 5,334 162 Back figures.—See Annual Report for 1937 (table 35). PAPER CURRENCY, BY DENOMINATIONS, AND COIN IN CIRCULATION [Outside Treasury and Federal Reserve Banks. In millions of dollars] i T n o c t i a r l - Coin and small denomination currency 2 Large denomination currency 2 Un- End of month cula- assort to ti t o a n li Total Coin $1* $5 $10 $20 Total $50 $100 $500 $1,000 $5,000 $10,000 ed» 1939—July 7,049 5,169 561 514 947 1,644 1,470 1,885 426 847 175 391 August 7,171 5,253 566 521 1,681 1,487 1,922 433 857 180 405 September- 7,293 5,329 571 532 1,706 1,507 1,965 440 876 185 413 October _._ 7,342 5,363 577 535 1,710 1,526 1,981 445 186 415 November- 7,483 5,478 586 545 1,004 1,752 1,557 2,007 452 188 420 December. 7,598 5,553 590 1,019 1,772 1,576 2,048 460 919 191 425 1940—January ... 7,376 5,332 579 526 970 1,692 1,532 2,047 457 191 426 February— 7,455 5,397 581 530 1,723 1,543 2,061 459 191 427 March 7,511 5,414 584 531 1,731 1,546 2,101 460 941 194 432 April 7,559 5,437 588 534 992 1,739 1,551 2,126 463 951 195 439 May 7,710 5,519 595 546 1,009 1,766 1,568 2,193 471 979 202 464 June 7,848 5,584 599 546 1,015 1,791 1,599 2,264 485 1,013 210 481 July .. 7,883 5,599 544 1,013 1,798 1,605 2,286 489 1,025 211 486 August 8,059 5,748 556 1,044 1,858 1,644 2,313 495 1,035 213 1 Total of amounts of coin and paper currency shown by denominations less unassorted currency in Treasury and Federal Reserve Banks. 2 Includes unassorted currency held in Treasury and Federal Reserve Banks and currency of unknown denominations reported by the Treasury as destroyed. 3 Paper currency only; $1 silver coins reported under coin. Back figures.—See Annual Report for 1937 (table 36). TREASURY CURRENCY OUTSTANDING SHIPMENTS AND RECEIPTS OF UNITED STATES PAPER CURRENCY [Held by Treasury and Federal Reserve Banks and in circulation, In [By selected banks and financial institutions in New York City. millions of dollars] In millions of dollars] End of month Total d S s l b o i a i i o l u n l l v d v l n l - a e e r i r r s s S c i i s a u l i o d v b r i - - y e n r Mi co n i o n r U S n n t o a i t t t e e e s s d n s b F e R e o a e r r e t n a - d v e k l - e s t n b i N o o a n t n a e - a k s l 1937 Year or month m E S e u n h r t i 2 o s p 1 p . - 5 t e o R E e f u r c o r e 4 o m i 7 p p .6 e ts m s N h e i e n p t t - s rec N e e i t p 26 t . s 1 1938 33.1 34.4 1.3 1939 110.2 9.8 100.4 1939—July 2,895 1,794 381 162 347 186 S N D A O e e o u c p c g v t t o e u e e b m m s m t e b b b r e . e e . r r r . . . . . 2 2 2 2 2 , , , , , 9 9 9 9 9 1 3 0 6 4 9 2 7 3 7 1 1 1 1 1 , , , , , 8 8 8 8 8 1 0 2 3 4 4 4 5 5 5 3 3 3 3 3 8 9 9 9 8 3 9 0 4 6 1 1 1 1 1 6 6 6 6 6 6 9 4 2 7 3 3 3 3 3 4 4 4 4 4 7 7 7 7 7 1 1 1 1 1 7 8 7 8 8 9 1 8 3 5 1939— N D S O A e o e c u p c v t g t o e e e u m m b m st e b b b r e e e . r r . r . . . . 4 4 6 1 . . . . . 5 7 8 8 6 1 . . . . 2 3 1 3 3 6 3 1 . . . . . 7 6 2 3 8 1940—January.. _. 2,971 1,855 400 169 347 175 1940—January... 5.3 0) 5.3 February- 2,981 1,866 401 170 347 173 February,. 4.7 0) 4.7 March 2,990 1,876 401 171 347 172 March 1.4 0) 1.4 April 2,999 1,886 400 172 347 171 April 3.5 0) 3.5 May 3,008 1,894 402 173 347 169 May 1.1 0) 1.1 June 3,014 1,900 402 174 347 167 June .5 .4 July 3,024 1,909 404 175 347 167 July .6 '. 1 .5 August 3,036 1,915 409 178 347 164 August .3 (0 .3 i Includes silver held against silver certificates amounting to $1,840,- i Less than $50,000. 00,000 on August 31,1940 and $1,704,000,000 on August 31, 1939. Back figures.—See Annual Report for 1937 (table 38). Description.—See BULLETIN for January 1932, pp. 7-8. OCTOBER 1940 1109 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ANALYSIS OF CHANGES IN GOLD STOCK OF UNITED STATES MOVEMENT OF GOLD TO AND FROM UNITED STATES1 [In millions of dollars] [In thousands of dollars] Period T G e o n o t d a ld l o s f to p I a c e n c k r a c i c o o a t d u i t v n e t c s t g r t o I e o o i n t n a l c a - d s k l e im g N o p e l o d t rt m l t a o g h t c s a a r r N e t a s o i r i a n k o n e u r i ( n t - s g o n - - s h r g ) 1 m g d t p D i t u o r e o i o o c s c l - - n - - d From or to— Im A - ugus E t x- Im- 1 J 9 u 4 l 0 y Ex- I J m an - .-Aug E . xports ports ports ports ports ports 1934 2 8,238 4, 202.5 1,133.9 82.6 92.9 1 1 1 1 1 9 9 9 9 9 3 3 3 3 3 6 9 5 8 7 1 1 1 1 12 4 0 1 7 , , , , ,6 5 1 2 7 4 1 2 5 6 4 2 5 8 0 1,22 2 7 6 . .5 9 3 1 1 1 1 , , , , , 8 1 1 7 8 5 3 3 5 0 7 2 2 1 2 . . . . . 0 5 2 5 5 3 : , , , , , 1 7 5 9 1 3 7 7 5 6 9 4 3 8 . . . . 5 6 0 2 . 6 5 - - -2 5 3 - 0 8 3 3 0 5 4 3 . . . . . 9 4 5 2 4 1 1 1 1 1 4 3 4 1 6 3 1 8 0 1 . . . . . 9 6 6 7 7 H I N B F t r a e e u a l l t n n g y h g i c e u a e r m r l y ands 24 4 6 1 1 3 3 1 , , , , 2 9 8 9 7 5 3 7 7 7 3 5 3 8 7 Norway 33, 405 1938— D N O S e c o e c t v p o e t e b e m m m e b r b b e e e r r r 1 1 1 1 3 4 4 4 , , , , 5 3 0 7 1 1 6 6 2 2 5 0 3 2 6 1 4 0 2 9 7 9 5 3 . . . . 6 8 0 5 2 5 5 1 2 4 7 6 0 0 2 7 . . . 8 5 4 9 -1 - - 1 6 - 1 7 2 3 0 . . . . 4 4 3 2 1 1 1 1 3 5 4 3 . . . . 3 5 1 5 S S S U P w w p o n r a i e i t t t i d u e z n e g d e . n r a l l K an in d gdom 1 1 7 3 0 , , , 6 3 8 3 6 8 1 6 7 8 6 9 30 2 3 1 , , , 1 1 7 5 4 3 3 8 7 7 2 6 1 2 6 2 9 6 1 6 8 0 , , , , , 6 2 6 4 2 1 9 6 8 0 2 2 5 9 7 1939— J J A N D M A M S F O u u J e e e p u o c a a n l a p b c n t y r g v r y e o t i e r u c u e e l b u m a h m s m e a r t b y r r b b y e e e r r r 1 1 1 1 1 1 1 1 1 1 1 1 6 7 5 5 6 4 4 7 5 6 6 7 , , , , , , , , , , , , 8 0 9 6 3 1 2 7 2 6 9 6 9 7 5 8 5 1 3 4 3 9 5 4 4 7 2 1 8 0 8 4 2 1 8 6 3 4 2 1 1 5 1 1 2 2 1 1 8 8 0 6 7 5 9 6 3 8 5 2 3 5 7 7 0 3 2 5 6 2 9 8 . . . . . . . . . . 1 1 0 6 7 9 2 0 3 3 8 9 2 3 6 4 2 2 2 3 4 1 1 2 6 2 0 2 4 5 6 7 5 5 6 6 5 9 3 9 5 9 0 6 8 1 8 . . . . . . . 4 7 1 3 8 4 4 6 9 2 3 0 - - - - - 1 2 1 1 2 -4 1 6 5 1 0 0 9 1 1 7 5 8 4 1 4 4 0 2 0 0 4 9 2 . . . . . . . . . . 6 . . 0 6 8 8 8 8 9 7 1 5 1 1 1 1 1 1 1 1 1 1 1 1 1 2 0 2 0 3 5 8 1 3 3 4 4 . . . . . . . . . . . . 4 7 8 8 4 9 7 3 3 3 9 3 Y U M V B E C C B P A C C e c r o u o a e e . h u e a r u n n n g l l s x i S u z o i l a e t a t o i v e . i r m r c d z d l s a i a . S o u o l a . a b l l a e . i . r i v a A l a R a ia merica ____ 26 1 4 4 0 2 6 , , , , , 5 6 7 8 9 4 3 6 1 3 1 6 4 8 3 4 8 3 3 8 3 6 9 6 0 5 6 0 7 8 6 5 17 2 2 6 5 1 5 1 , , , , , , , 6 8 3 8 5 2 8 8 2 2 1 9 3 0 5 1 6 1 9 0 1 7 6 1 7 6 9 2 5 1 1 1 2 2 1, 8 2 1 4 1 1 3 7 4 6 0 5 5 7 2 3 8 " 9 , , , , , , , , , , , 1 5 6 3 2 8 9 3 7 8 0 7 5 7 7 4 3 0 0 1 7 5 4 1 0 6 8 0 2 2 5 0 4 3 6 4,781 3 1940— A M A J M J F u J u e u p a a l a n b g n y r r y e i r u u c l u a h s a r t y ry 1 2 2 1 1 1 1 1 9 0 7 0 8 9 8 8 , , , , , , , , 9 9 9 1 4 4 2 3 7 1 6 7 3 0 6 7 3 1 3 7 3 9 3 0 2 2 4 7 2 3 4 4 4 8 3 5 5 3 9 5 4 6 7 9 6 6 9 0 . . . . . . . . 0 5 0 2 0 9 4 2 1, 2 2 4 2 4 3 5 1 3 6 3 0 5 4 5 2 5 3 6 1 9 9 1 0 . . . . . . . . 4 4 9 8 6 0 1 0 - -4 2 - - 3 3 5 1 7 4 3 6 6 6 5 3 . 7 0 7 7 . . . . . . . 7 4 1 0 0 2 0 2 1 1 1 1 1 1 1 4 1 3 2 6 3 1 . . . . . . . 4 6 0 1 0 0 1 B N J S A P C a o h r l h e K p l i u i t i t a l h n o i t o i n h s e p a t n h h r p g A l e i a I . r n f a n . n r . e n c i d d c d o i s a I a u s I n l n a H tr d n i o i e d e n s s s g . * . 11 6 3 3 1 , , , , , 7 3 7 3 9 6 5 7 6 3 8 5 7 6 8 8 4 7 2 3 1 , , , 4 8 5 5 '8 8 8 3 5 5 1 2 2 9 1 3 6 2 2 6 2 9 2 5 1 7 7 , , , , , , , 4 2 0 2 0 6 2 9 4 1 6 0 4 4 1 3 ' 5 7 1 8 Sept. 1-25*. . 21,166 253.3 267.8 27. Total 351, 563 10 519,983 3, 622,083 p Preliminary. 1 Gold held under earmark at Federal Reserve Banks for foreign ac- r Revised. count on August 31, 1940, in millions of dollars: 1,694.3. 1 Figures represent customs valuations which, with some exceptions, * Figures based on rate of $20.67 a fine ounce in January 1934 and $35are at rate of $35 a fine ounce. a fine ounce thereafter. 2 Includes all movements of unreported origin or destination. NOTE.—Fisures for domestic production of gold are those published Back figures.—See table, p. 1141, and Annual Report for 1937 (tables in table, p. 1141, adjusted to exclude Philippine Islands production re- 31 and 32). ceived in United States. Adjustment based on annual figures reported by Director of Mint and monthly imports of gold to U. S. from Philip- BANK DEBITS pines. For back figures see Annual Report for 1937 (table 29). [Debits to deposit accounts, except interbank accounts, at banks in BANK SUSPENSIONS1 principal cities.] [In millions of dollars] Total, 140 133 Member Nonmember all New other other Total, banks banks Year and month report- York lead- reportall ing City ing ing banks ti N on a a - l State su I r n e - d2 in N su ot red centers centers *centers 1929 982, 531 603,089 331,938 47, 504 1935 402, 718 184,006 190,165 28,547 Number of banks suspended: 1936 461,889 208,936 219, 670 33, 283 1934 8 48 1937 469,463 197, 836 235, 206 36, 421 1935 22 8 1938 405, 929 168, 778 204, 745 32,406 1936 40 3 1939 423, 932 171, 382 218, 298 34,252 1937 47 6 1938 47 6 1939—July 33, 245 12,794 17,683 2,768 1939 25 10 August 33,314 13,118 17, 496 2,701 1940—Jan.-Aug 15 2 September 36, 594 15,138 18, 526 2,930 De ( p in 1 o 9 s t 3 i h t 4 o s u o s f a s n u d s s p e o n f d d e o d ll b a a r n s) k : s 3 36,937 40 1,912 34,985 N D O o e c c v to e e m b m e b b r e e . r . r . . 4 3 3 3 4 5 , , , 4 8 6 3 4 6 0 7 6 1 1 1 3 7 3 , , , 6 0 6 3 4 8 3 1 3 2 1 18 2 9 , , , 0 6 3 2 3 8 9 6 6 2 3 3 , , , 9 4 1 9 1 2 0 9 8 1935 10,015 5,313 3,763 939 1940—January... 37, 786 14, 739 19, 978 3,069 1936 11,306 507 10,207 592 February.. 32,197 12,138 17, 344 2,715 1937 19,723 7,379 1,708 10,156 480 March 37, 769 15, 201 19, 537 3,031 1938 13,012 36 211 11,721 1,044 April 37, 780 15, 519 19, 250 3,010 34,998 1,341 24, 629 6,589 2,439 May 37, 257 14, 536 19,659 3, 063 1940—Jan.-Aug.. 4,871 4,683 188 June _ 35,005 13,110 18,850 3,045 July 35, 947 13,612 19,233 3,103 1 Represents banks which, during the periods shown, closed tem- August 32, 845 11, 604 18,314 2,927 porarily or permanently on account of financial difficulties; does not include banks whose deposit liabilities were assumed by other banks at 1 Comprises centers for which bank debit figures are available beginthe time of closing (in some instances with the aid of Federal Deposit ning with 1919, except that one substitution was made in 1920 and one Insurance Corporation loans). in 1928. 2 Federal deposit insurance became operative January 1, 1934. 2 Centers (other than the 141 centers) for which bank debits are current- 3 Deposits of member banks and insured nonmember banks suspended ly reported. The number has changed very little since 1934 and has are as of dates of suspension, and deposits of noninsured nonmember numbered 133 since 1936. banks are based on the latest data available at the time the suspensions Back figures—For corresponding monthly totals for 1928-1937 see were reported. Annual Report for 1937 (Table 71), which also gives a definition of bank Back figures.—See Annual Report for 1937 (table 76). debits. Figures for individual reporting cities and totals by Federal Reserve districts for recent years are available in mimeographed form. 1110 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

ALL BANKS IN THE UNITED STATES Comprises all national banks in the continental United States and all State commercial banks, trust companies, mutual and stock savings banks and such private and industrial banks as are included in abstracts issued by State banking departments. Also includes, during the period June 1934-June 1935, private banks which, pursuant to the provisions of sec. 21 (a) of the Banking Act of 1933, submitted condition reports to the Comptroller of the Currency. Under the amended provisions of sec. 21 (a) private banks no longer report to the Comptroller of the Currency. For comparative figures of private banks included in the figures from June 1934 to December 1935, see Federal Reserve BULLETIN for December 1935, p. 883, and July 1936, p. 535. Figures for nonmember banks are for dates indicated or nearest thereto for which figures are available. NUMBER OF BANKS DEPOSITS, EXCLUSIVE 1)F INTERBANK DEPOSITS Nonmember [In millions of dollars] Member banks banks Member banks Nonmember banks Call date Total Other Mutual non- Call date All Total Na- State savings mem- banks Mutual Other tional banks ber Total Na- State savings nonmembanks tional banks ber banks 1929—June 29 25,110 8,707 7,530 1,177 611 15,792 1929—June 29.._ 53,852 32,284 19,411 12,873 8,983 12,584 Dec. 31 24,630 8,522 7,403 1,119 609 15,499 Dec. 31___ 55, 289 33,865 20,290 13, 575 8,916 12,508 1933—June 30. ___ 14,519 5,606 4,897 709 576 8,337 1933—June 30... 37, 998 23, 338 14,772 8,566 9,713 4,946 Dec. 30 15,011 6,011 5,154 857 579 8,421 Dec. 30 .. 38, 505 23,771 15, 386 8,385 9,708 5,026 1934—June 30 15,835 6,375 5,417 958 578 8,882 1934—June 30. _ 41,870 26, 615 17,097 9,518 9,780 5,475 Dec. 31 16,039 6,442 5,462 980 579 9,018 Dec. 31_- 44,770 28,943 18, 519 10,424 9,828 6,000 1935—June 29 15,994 6,410 5,425 985 571 9,013 1935—June 29___ 45, 766 29,496 19,031 10,465 9,920 6,350 Dec. 31 15,837 6,387 5,386 1,001 570 8,880 Dec. 31__. 48, 964 32,159 20,886 11, 273 9,963 6,842 1936—June 30 15, 752 6,400 5,368 1,032 566 8,786 1936—June 30. . 51, 335 34,098 21, 986 12,112 10,060 7,178 Dec. 31 15,628 6,376 5,325 1,051 565 8,687 Dec. 31_._ 53, 701 35,893 23,107 12, 786 10,143 7,666 1937—June 30 15, 527 6,357 5,293 1,064 564 8,606 1937—June 30. __ 53,287 35,440 22, 926 12, 514 10, 213 7,635 Dec. 31 15, 393 6,341 5,260 1,081 563 8,489 Dec. 31... 52,440 34,810 22,655 12,155 10,257 7,373 1938—June 30 15,287 6,338 5,242 1,096 563 8,386 1938—June 30. „ 52,195 34, 745 22, 553 12,193 10,296 7,153 Dec. 31 15,206 6,338 5,224 1,114 556 8,312 Dec. 31.__ 54,054 36,211 23,497 12, 714 10,365 7,478 1939—June 30 15,082 6,330 5,203 1,127 553 8,199 1939—June 30... 55, 992 38,027 24, 534 13,493 10, 521 7,444 Dec. 30 15,037 6,362 5,187 1,175 552 8,123 Dec.30._- 58,344 39,930 25, 661 14, 269 10,613 7,801 1940—Mar. 26 15,006 6,377 5,178 1,199 551 8,078 1940—Mar. 26... 59,017 40, 579 25,911 14,667 310,544 37,895 June 29 « 14,953 6,398 5,164 1,234 551 8,004 June 294.. 60, 585 42,039 26,931 15,108 10,631 7,915 For footnotes see table below. For footnotes see table below. LOANS AND INVESTMENTS [In millions of dollars] ' All banks Member banks Nonmember banks Mutual savings banks Other nonmember banks Call date Total Loans I m nv e e n s t t s - Total Loans I m nv e e n s t t s - Total Loans Invest- Total Loans Investments ments 1929—June 29 _ 58,474 41,531 16,943 35,711 25,658 10,052 9,556 5,892 3,664 13,207 9,981 3,227 Dec. 31 58,417 41,918 16,499 35,934 26,150 9,784 9,463 5,945 3,518 13,020 9,823 3,197 1933—June 30 40,076 22,203 17,872 24, 786 12,858 11,928 10,044 5,941 4,103 5,246 3,404 1,841 Dec. 30 40,319 21,977 18,342 25,220 12,833 12,386 9,985 5,906 4,079 5,115 3,238 1,877 1934—June 30 42, 502 21,278 21, 224 27,175 12, 523 14,652 9,904 5,648 4,256 5,423 3,108 2,315 Dec. 31 43,458 20,473 22,984 28,150 12,028 16,122 9,782 5,491 4,291 5,526 2,955 2,571 1935—June 29 44,416 20,272 24,145 28, 785 11, 928 16,857 9,852 5,341 4,511 5,779 3,003 2,777 Dec. 31 45, 717 20,329 25,388 29, 985 12,175 17,810 9,804 5,210 4,594 5,927 2,944 2,983 1936—June 30. 48,458 20, 679 27, 778 32, 259 12, 542 19, 717 9,961 5,105 4,856 6,238 3,032 3,206 Dec. 31 49, 524 21,449 28,075 33,000 13,360 19, 640 10,060 5,027 5,034 6,464 3,062 3,402 1937—June 30 49, 696 22, 514 27,182 32,739 14, 285 18,454 10,180 5,002 5,178 6,778 3,227 3,550 Dec. 31 48, 566 22,198 26, 368 31, 752 13,958 17, 794 10,187 4,996 5,191 6,627 3,244 3,383 1938—June 30 47,381 21,130 26,252 30, 721 12,938 17, 783 10,196 4,961 5,235 6,465 3,231 3,234 Dec. 31 ^ _ _ 48, 929 21,354 27, 575 32,070 13, 208 18,863 10, 255 4,930 5,325 6,604 3,217 3,387 1939—June 30. 49,616 21,318 28, 299 32, 603 13,141 19,462 10,342 4,931 5,411 6,671 3,245 3,425 Dec 30 50,885 22,169 28,716 33,941 13,962 19, 979 10, 314 4,961 5,353 6,630 3,246 3,384 1940—Mar. 26 _ 51,135 22,190 28,945 34,163 13,939 20, 224 310,226 4,922 5,304 3 6,746 3,329 3,417 June 29 4 51, 337 22, 340 28,996 34,451 13, 969 20,482 10,188 4,925 5,263 6,698 3,446 3,251 1 Prior to Dec. 30, 1933, member-bank figures include interbank deposits not subject to immediate withdrawal, which aggregated $103,000,000 on that date. The nonmember bank figures include interbank deposits to the extent that they are not shown separately in a few State bank abstracts. 2 Beginning December 1938 figures of loans and investments exclude approximately $50,000,000 and $100,000,000, heretofore reported as loans and investments, respectively, which indirectly represent bank premises or other real estate and are now classified in condition reports among "Other assets." 3 One bank (with deposits, excluding interbank deposits, of $90,000,000 and total loans and investments of $96,000,000 on December 30,1939 which was formerly classified as a mutual savings bank, is included in the March 26, 1940 figures in "Other nonmember banks" column. * Preliminary figures. Back figures.—SeeA nnual Report for 1937 (tables 48-49). OCTOBER 1940 1111 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

CONDITION OF ALL MEMBER BANKS-LOANS AND INVESTMENTS [In millions of dollars] Loans * Investments 1 Call date m T l v o a i o e e n a n s t n n d - a t t s - l s Total i C t m d a c r i o u n i n i e a a m s d - r l l - - ' - A t c u g u r l r - - i- p O m k a p p a e e r t e n - r b a o p r T e L s n o r u r o e s d k o r c c c a - a u h n r r a s o r it y s t f i i h i o T e n n e s r o g g rs3 e l R o st e a a n a t l s e L ba o t n o a k n s s l O o t a h n e s r 4 Total T U o . t a S l . G B o il v ls ern N D m o i e r t e e n c s t t o B b o li n g d a s tio G t n a e u s n e a d - r- g S p O a d s a i t o t u c i o a n b i v l b a o t f l d i i e l - i t n - - - s s r O s i e t t i c h e u e s - r deal- sions ers Total—All Member Banks 1929—Dec. 31. _35,934 26,150 583 2,463 3,191 714 11,515 9,784 3,863 249 520 3,094 1,393 4,528 1933—June 30_.24,786 12,858 595 953 3,752 2,372 330 4,857 11,928 1,113 049 3,725 1,744 3,297 1938—June 30__30,721 12.938 492 701 2,614 2,613 120 6,397 17, 783 12,343 316 3', 653 6,246 .128 2,143 3,296 Sept. 28. 31, 627 12,937 484 713 2,590 2,661 126 6,364 18, 689 13,011 313 3,707 2,298 2,317 3,361 Dec. 31_. 32,070 13, 208 4,737 442 973 775 2,716 2,728 18,863 13,222 286 3,389 7,208 2,340 2,448 3,192 1939—Mar. 29__32,095 13,047 4,760 427 838 733 2,749 2,671 19,048 13,351 303 2,604 7,783 2,660 2,555 3,142 June 30. _32, 603 13,141 4,783 420 731 736 2,828 58 2,796 19,462 13,777 441 2,720 7,786 2,831 2,554 3,131 Oct. 2«__33,075 13,470 19, 605 13,811 2,920 2,764 3,030 Dec. 30_.33,941 13,962 730 790 7002,957 56 2,888 19, 979 14,328 5632,223 3,144 2,692 2,959 1940—Mar. 26 • 34,163 13.939 20, 224 14,421 3,107 2,905 2,898 June 29 _34,451 13, 969 5,538 736 450 447 3,069 42 3,020 20,482 14, 722 7972,543 8,261 3,121 2,888 2,873 New York City i 1929—Dec. 31_. 8,774 6,683 195 1,257 2,145 169 322 2,595 2,091 1,112 58 166 222 758 1933—June 30__ 7,133 3,424 364 758 1,044 157 162 937 3,709 2,551 638 987 478 680 1938—June 30_. 8,013 3,172 141 • 556 717 132 85 1,541 4,840 3,740 222 1,358 1,451 709 394 707 Sept. 28. 8,355 3,146 153 564 702 132 95 1,499 5,209 3,987 251 1,342 1,560 834 495 727 Dec. 31__ 8,335 3,262 1,456 138 787 220 121 99 436 5,072 3,857 158 1,142 1,663 894 517 698 1939—Mar. 29__ 8,408 3,086 1,451 126 668 209 124 77 427 5,322 4,025 68 831 2,040 1,086 582 714 June 30__ 2,988 1,474 128 555 215 130 41 440 5,700 4,483 168 2,284 1,123 480 736 Oct. 2 •„ 9,044 3,116 5,928 4,558 1,157 662 708 Dec. 30__ 9,339 3,296 1,768 120 611 188 133 44 425 6,043 4,772 315 797 2,385 1,275 579 1940—Mar. 26« 9,594 3,211 6,383 4,972 1,286 726 June 29 __ 9,829 3,014 17801" 103 320 188 137 32 426 6,815 5,486 421 1,092 2,650 1,324 634 695 City of Chicago 7 1929—Dec. 31__ :,757 1,448 251 533 535 309 116 3 19 94 96 1933—June 30. _ ,287 677 61 251 237 610 384 206 82 97 87 138 1938—June 30__ 525 29 109 361 1,281 981 12 313 535 122 140 159 Sept. 28. 522 31 111 351 1,367 1,047 1 310 611 126 144 175 Dec. 31._ 539 319 43 70 62 1,430 1,114 59 291 655 109 141 176 1939—Mar. 29.. 1,965 545 340 32 70 57 1,420 1,100 121 212 660 108 149 171 June 30__ 2,052 544 329 39 71 59 1,507 1,175 185 234 621 135 154 179 Oct. 2 o__ 2,050 563 1,487 1,172 155 147 168 Dec. 30._ 2,105 569 365 41 66 13 60 1,536 1,203 153 701 172 162 170 1940—Mar. 26« 2,222 564 1,658 1,319 139 175 164 June 29.. 2,205 603 417 23 61 62 1,602 1,258 254 161 710 134 177 167 Reserve City Banks 1929—Dec. 31__12,029 9,084 168 2,775 1,538 258 3,679 2,944 1,368 91 165 1,112 448 1,128 1933—June 30. _ 8,492 4,482 126 108 1,340 1,131 99 1,678 4,011 2,483 205 681 1,597 598 930 1938—June 30. _11,150 4,853 163 95 1,201 26 4,658 69 1,268 2,603 718 732 908 Sept. 28. 11,426 4,870 156 96 1,217 22 2,387 6,556 4,831 47 1,290 2,752 743 775 950 Dec. 31__ 11, 654 4,963 1,914 149 119 242 1,230 20 1,081 5,018 57 1,224 2,997 740 808 866 1939—Mar. 29..11,624 4,936 1,889 145 115 228 1,249 17 1,066 5,004 100 977 3,105 823 823 860 June 30__ 11, 756 5,004 1,884 138 115 221 1,284 12 1,116 6,751 4,991 78 1,014 3,010 889 895 866 Oct. 2 8__11,880 5,127 6,752 4, ~~~ 909 897 856 Dec. 30__ 12,272 5,329 2,100 221 155 2221,335 1,168 6,943 5,194 819 3,339 972 890 860 1940—Mar. 26« 12,153 5,305 6,848 5,070 963 928 850 June 29.. 12,160 5,365 2,134 176 156 87 2101,372 1,224 6,795 4,947 87 839 3,052 Country Banks 1929—Dec. 31__13,375 201 291 2,231 1,462 45 4,705 4,439 1,267 171 999 627 2,546 1933—June 30. _ 7,873 4,275 35 25 1,117 1,055 2,005 1,469 299 1,106 581 1,549 1938—June 30. _ 9,752 4,388 173 21 790 1,269 2,126 5,364 2,964 715 1,657 579 878 1,522 Sept. 28. 9,958 4,399 156 21 784 1,303 2,127 5,558 3,146 766 1,770 596 903 1,509 Dec. 31__ 10,113 4,444 1,048 138 25 243 1,353 1,149 5,669 3,233 732 1,893 597 982 1,453 1939—Mar. 29..10,098 4,480 1,081 142 24 226 1,363 1,121 5,618 3,221 585 1,978 643 1,001 1,397 June 30.. 10,109 4,605 1,095 140 22 229 1,402 1,180 5,504 3,127 563 1,870 683 1,025 1,351 Oct. 2«. 10,102 4,665 5,437 3,082 699 1,058 1,297 Dec. 3O._10,224 4,768 1,151 163 20 224 1,477 1,234 5,456 3,159 431 1,972 725 1,061 1,236 1940—Mar. 266 10,194 5,334 3,060 719 1,076 1,197 June 29.. 10,257 4, I,"l87 174 208 1,544 5,270 3,030 451 1,849 695 1,097 1,144 1 Classifications indicated were revised as of Dec. 31,1938; for explanation see BULLETIN for January, 1939, pp. 22-23, and BULLETIN for April 1939, pp. 259-264, 332. Beginning June 30,1939, detailed classifications available on June and December dates only. 2 Not shown in call reports prior to December 1938, but the total amount of agricultural loans was reported separately on some dates, and the total amount of "Commercial, industrial and agricultural paper" has been reported by weekly reporting banks since May 1937. 8 Figures in this column prior to Dec. 31,1938, represent all loans on securities, regardless of purpose, excepting only loans on securities to banks and to brokers and dealers. 4 This is a residual item and, because of the revised loan classifications, figures beginning Dec. 31,1938, are not comparable with earlier figures 6 Includes Treasury certificates of indebtedness through 1934. 6 Breakdown of loans and investments not reported separately. 7 Central reserve city banks. Back figures.—See Annual Report for 1937 (tables 52-58). 1112 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

CONDITION OF ALL MEMBER BANKS—RESERVES AND LIABILITIES [In millions of dollars] Demand deposit3, Time deposits, Interbank except interbank except interbank deposits Reserves Bal- De- Indi- Indi- Domestic B s w F e a R e e r n r i e a t v d k - h l e - s v C a i a n u sh lt b m a w a n d e n i c o s t k e - h t s s ic 1 j m p u o a d s a s d e t n e i - - d t d s 2 s u p p v n h a c o a a i e o i n d r r l p r r d s a t - - s - - , - , S p s d s a i t i o u i c a o n v l a b t n d i i e l - t s - - s c C h c e f a o e e i e t f n e c r f c r d d i . t s k - 3 i ' - s m U G e e . r o n n v S - t - 4 . s p p u v h n a c o a a o i e i n r d r p l r r d s a t - - s - - , - , S p s d s a I t i o u C i a o n v l b t a n i d e i l t - - s - s P i s n o a g s v s t - a 4 l m D a e n b - d ank T s ime b e F a i o n g r k n - s r B i o n o w g r s - - c C o i a t a u c a p n - l - ts Call date tions tions Total—All Member Banks 2,374 558 2,168 16,647 17,526 1,335 1,681 143 12,267 595 122 3,517 95 698 879 6,709 1929—Dec. 31 2,235 405 2,008 12,089 11,830 1,087 657 806 7,803 300 788 3,057 89 146 191 4,837 1933—June 30 8,004 712 4,084 20,893 19,816 2,314 662 543 10,874 454 83 6,096 135 331 11 5,368 1938—June 30 8,193 775 3,937 21, 596 20,439 2,080 538 707 10,789 464 70 6,088 130 466 12 5,410 Sept. 28 8,694 746 4,240 22,293 21,119 2,386 547 790 10,846 462 61 6,510 132 511 6 5,424 Dec. 31 9,112 777 4,403 22,364 20,845 2,467 533 775 10,940 461 68 6,816 133 629 7 5,467 1939—Mar. 29 10, Oil 712 4,674 23, 587 22,448 2,532 790 694 11,063 441 59 7,097 142 607 5 5,496 June 30 11, 617 774 6 5,304 25,118 23,983 2,390 666 675 11,104 418 51 6 8,243 6 142 6 757 5 5,530 Oct. 2 11,604 841 5,506 25, 681 24,604 2,321 563 743 11, 215 432 51 8,507 144 759 3 5,522 Dec. 30 12,279 862 6 5,634 26,461 24,965 2,499 558 725 11,368 411 52 6 8,717 6 145 6 737 2 5,562 1940—Mar. 26 13, 751 789 5,751 27,877 26, 397 2,529 475 711 11, 459 410 59 8,852 134 703 3 5,608 June 29 New York City* 827 68 179 4,750 5,847 128 1,180 20 1,112 33 18 1,198 40 597 179 2,105 1929—Dec. 31 846 46 101 4,358 4,676 96 461 332 671 4 110 1,255 22 128 8 1,582 1933—June 30 3,517 65 119 6,698 6,900 273 367 • 123 694 32 2,514 291 L, 587 1938—June 30 3,743 70 91 7,026 7,128 196 280 181 653 64 2,498 411 2 L, 589 Sept. 28 4,104 68 109 7,168 7,273 280 195 139 652 36 2,687 442 1,593 Dec. 31 4,582 63 156 7,605 7,677 260 272 135 655 53 2,731 553 L, 592 1939—Mar. 29 4,975 61 112 8,012 8,281 288 472 84 653 46 2,992 524 1,586 June 30 5,929 85 6109 8,676 8,812 321 349 72 683 52 6 3, 568 6 670 1 I. 587 Oct. 2 5,915 89 125 8,899 9,030 251 178 74 693 43 3,542 1 695 1^ 592 Dec. 30 6,386 84 6 163 9,562 9,652 219 260 68 742 35 6 3,629 6 1 6 672 1,601 1940—Mar. 26 7,072 88 119 10, 235 10,283 258 147 67 732 29 3,840 650 1,599 June 29 City of Chicago s 169 13 133 957 1,041 42 32 8 332 58 2 310 19 33 41 316 1929—Dec. 31 232 34 203 912 870 87 16 46 358 1 6 259 2 204 1933—June 30 936 31 208 1,523 1,386 221 23 86 443 16 688 6 249 1938 June 30 856 32 198 1,585 1,455 204 24 62 439 21 636 10 256 Sept. 28 884 35 235 1,688 1,597 181 29 83 452 9 658 9 257 Dec. 31 705 22 178 1,250 1,182 141 26 83 452 12 834 10 261 1939—Mar. 29 897 26 235 1,666 1,565 197 22 60 471 17 746 12 270 June 30 1,080 37 6 237 1,747 1,632 195 27 60 469 21 3 6 853 6 14 270 Oct. 2 993 42 283 1,739 1,676 167 24 80 483 10 3 879 9 250 Dec. 30 909 25 6 195 1,544 1,503 133 18 80 482 11 5 3 997 37 253 1940—Mar. 26 1,187 39 242 1,898 1,782 199 17 79 489 15 5 949 7 260 June 29 Reserve City Banks 751 156 947 5,229 5,547 423 300 76 4,433 371 41 1,604 30 64 292 2,029 1929— Dec. 31 705 122 1,002 3,764 3,708 349 108 312 2,941 208 388 1,315 59 15 16 1,533 1933—June 30 2,289 300 1,951 6,934 6,668 812 146 266 4,238 262 31 2,514 113 32 1,753 1938—June 30 2, 311 322 1,862 7 078 6,843 711 120 356 4,209 233 23 2,557 107 43 1,764 Sept. 28 2,354 321 1,940 7,214 7,034 796 170 424 4,233 269 17 2,719 108 57 1,777 Dec. 31 2,459 342 2,106 7,326 6,899 889 123 420 4,276 243 22 2,813 108 64 2 1,795 1939—Mar. 29 2,735 318 2,210 7,654 7,331 917 160 415 4,320 233 19 2,920 115 69 1,812 June 30 3,053 323 6 2,485 8,017 7,803 801 158 410 4,319 198 14 6 3,307 6 116 6 71 1,821 Oct. 2 3* 118 348 2,485 8,176 8,002 813 190 435 4,362 240 14 3,516 117 53 1,828 Dec. 30 3, 336 364 6 2,632 8 400 7,978 942 150 431 4,386 214 12 6 3, 525 8 115 6 56 1,833 1940—Mar. 26 3* 759 334 2, 679 8,774 8,372 956 147 422 4,422 219 18 3,526 105 44 1,873 June 29 Country Banks 627 321 908 5,711 5,091 742 169 39 6,390 133 61 405 6 3 367 2,258 1929—Dec. 31 452 203 702 3,054 2,576 555 72 116 3,833 86 285 228 7 1 167 1,517 1933—June 30 1,263 316 1,806 5,738 4,863 1,008 126 68 5,499 144 52 380 22 2 11 1,778 1938—June 30 1,282 351 1,786 5,908 5,013 969 114 108 5,488 147 46 398 23 2 11 1,801 Sept. 28 1,353 322 1,956 6,224 5,215 1,128 154 143 5,509 147 44 446 23 2 6 1,798 Dec. 31 1,367 350 1,963 6,183 5,087 1,176 114 137 5,557 153 46 438 25 2 5 1,818 1939—Mar. 29 1,403 307 2,117 6,255 5,272 1,130 135 136 5,619 145 40 439 26 2 5 1,828 June 30 1,555 329 8 2,473 6,677 5,736 1,073 131 133 5,632 148 35 «515 6 26 62 4 1,852 Oct. 2 1,578 363 2,614 6,866 5,896 1,090 172 154 5,677 140 35 571 26 2 3 1,851 Dec. 30 1,648 389 6 2,645 6,954 5,832 1,205 131 147 5,757 151 35 6 566 6 29 «2 2 1,875 1940—Mar. 26 1,733 328 2,711 6,969 5,960 1,115 164 143 5,816 147 37 538 29 2 3 1,876 June 29 1 Prior to Dec. 31,1935, excludes balances with private banks to the extent that they were then reported in "Other assets." Since Oct. 25,1933, includes time balances with domestic banks which on that date amounted to $69,000,000 and which prior to that time were reported in"Other assets.*' 2 Demand deposits other than interbank and U. S. Government, less cash items reported as in process of collection and, prior to Dec. 31,1935, less cash items reported on hand but not in process of collection. 3 Includes "Due to Federal Reserve Banks (transit account)," known as "Due to Federal Reserve Banks (deferred credits)" prior to Dec.31,1935. 4 U. S. Treasurer's time deposits, open account, are combined with postal savings (time) deposits. 6 Central reserve city banks. 8 Partly estimated Back figures.—See Annual Report for 1937 (tables 52-58). OCTOBER 1940 1113 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

WEEKLY REPORTING MEMBER BANKS-NEW YORK CITY AND OUTSIDE LOANS AND INVESTMENTS [Monthly data are averages of Wednesday figures. In millions of dollars.] Loans Investments Loans for U. S. Government obligations Com- purchasing Total mer- or carrying loans cial, securities Date or month m v a i e e n n s n d - t t - s Total t d a r i u i n n a s d - - l, p O m k a p a p e e r t e n - r br T o o k- e l R o st a e a n a t l s e L ba o t n o a k n s s O lo t a h n e s r Total Total Bills Notes Bonds G a u n a - r- s r O i e t t c i h e u e s - r agri- ers To teed cul- and others tural dealers Total—101 Cities 1939—August 22, 327 8,179 3,930 313 642 1,171 1,540 14,148 10, 802 2,149 5,900 2,265 3,346 1940—April 23,489 4,414 335 624 474 1,182 1,569 14,843 11, 339 575 1,839 6,527 2,398 3,504 May 23, 555 8,599 4,397 327 574 475 1,191 1,588 14,956 11,460 638 1,905 6,510 2,407 3,496 June 23, 591 8,446 4,383 313 422 471 1,199 1,616 15,145 11, 603 751 1,993 6,457 2,402 3,542 July 23, 787 8,494 4,451 295 399 473 1,204 1,635 15, 293 11,728 777 2,081 6,455 2,415 3,565 August 24,140 8,504 4,456 295 375 470 1,214 1,655 15, 636 11, 994 730 2,113 6,572 2,579 3,642 July 10 23, 683 8,461 4,447 297 377 471 1,200 1,633 15, 222 11,642 773 2,070 6,383 2,416 3,580 July 17 23,743 8,517 4,464 298 408 474 ,205 1,633 15,226 11, 644 769 2,083 6,377 2,415 3,582 July 24 23, 947 8,514 4,462 290 411 476 ,206 1,633 15, 433 11,871 794 2,093 6, 565 2,419 3,562 July 31 23, 978 8,517 4,441 291 419 474 ,210 1,642 15,461 11,875 791 2,099 6,567 2,418 3,586 Aug. 7 24,101 8,492 4,446 291 384 472 ,211 1,649 15,609 12.005 738 2,111 6,587 2,569 3,604 Aug. 14 24,121 8,506 4,461 294 376 469 ,213 1,654 15, 615 12.006 733 2,114 6,580 2,579 3,609 Aug. 21 24,180 8,509 4,455 295 377 473 ,215 1,655 15,671 11,994 735 2, 116 6,560 2,583 3,677 Aug. 28 24,157 8,509 4,463 299 363 467 ,215 1,662 15, 648 11, 969 2,113 6,562 2,582 3,679 Sept. 4 24,188 8,566 4,480 294 390 463 1,219 1,672 15, 622 11, 957 2,095 6,573 2,584 3,665 Sept. 11 24, 294 8,665 4,571 296 392 460 1,220 1,676 15,629 11,964 710 2,091 6,576 2,587 3,665 Sept. 18 24, 284 8,692 4,578 296 404 462 1,222 1,685 15, 592 11,888 673 2,091 6,541 2, 583 3,704 Sept. 25 24,166 4,575 295 415 462 1,223 1,684 15, 477 11, 779 619 2,056 6,528 2,576 3,698 New York City 1939—August 8,349 2,828 1,483 117 493 184 117 382 5,521 4,334 205 826 2,166 1,137 1,187 1940—April. _ 9,108 2,965 1,686 111 482 160 119 366 6,143 4,838 170 888 2,527 1,253 1,305 May 9,172 2,905 1,673 108 433 160 120 371 6,267 4,995 242 950 2,528 1,275 1,272 June 9,263 2,763 1,671 101 298 159 122 377 6,500 5,207 396 989 2,540 1,282 1,293 July 9,400 2,778 1,710 90 281 167 122 378 6,622 5,285 392 1,035 2,570 1,288 1,337 August 9,554 2,752 1,698 83 269 164 124 384 6,802 5,407 334 1,060 2,641 1,372 1,395 July 10 9,379 2,764 1,714 91 265 166 122 377 6,615 5,264 411 1,023 2,543 1,287 1,351 July 17 _ 9,400 2,786 1,711 91 287 169 122 378 6,614 5,261 403 1,034 2,538 1,286 1,353 July 24 _.. 9,458 2,786 1,713 87 288 169 123 377 6,672 5,336 389 1,051 2,608 1,288 1,336 July 31 9,489 2,788 1,698 302 167 123 381 6,701 5,348 1,052 2,618 1,289 1,353 Aug. 7 9,527 2,766 1,708 275 165 123 381 6,761 5,402 341 1,055 2,637 1,369 1,359 Aug. 14 9,520 2,754 1,703 270 164 124 383 6,766 5,404 329 1,061 2,640 1,374 1,362 Aug. 21 9,600 2,751 1,691 273 166 124 385 6,849 5,421 343 1,062 2,643 1,373 1,428 Aug. 28 2,737 1,691 259 162 124 388 6,831 5,402 324 1,062 2,644 1,372 1,429 Sept. 4 __.. 9,599 2,765 1,691 281 162 124 392 6,834 5,398 323 1,047 2,655 1,373 1,436 Sept. 11 9,678 2,826 1,74? 285 163 124 393 6,852 5,418 330 1,046 2,668 1,374 1,434 Sept. 18 9,691 2,833 1,750 295 164 124 390 6,858 5,394 319 1,045 2,654 1,376 1,464 Sept. 25 9,596 2,828 1,753 301 163 123 387 6,768 5,314 274 1,014 2,645 1,381 1,454 Outside New York City 1939—August 13, 978 5,351 2,447 196 149 337 1,054 1,158 8,627 6,468 283 1,323 3,734 1,128 2,159 1940—April 14, 381 5,681 2, 728 224 142 314 1,063 1,203 8,700 6,501 405 951 4,000 1,145 2,199 May 14, 383 5,694 2,724 219 141 315 1,071 1,217 8,689 6,465 396 955 3,982 1,132 2,224 June 14, 328 5,683 2,712 212 124 312 1,077 1,239 8,645 6,396 355 1,004 3,917 1,120 2,249 July 14, 387 5,716 2,741 205 118 306 1,082 1,257 8,671 6,443 385 1,046 3,885 1,127 2,228 August 14, 586 5,752 2,758 212 106 306 1,090 1,271 8,834 6,587 396 1,053 3,931 1,207 2,247 July 10 14, 304 5,697 2,733 206 112 305 1,078 1,256 8,607 6,378 362 1,047 3,840 1,129 2,229 July 17 14,343 5,731 2,753 207 121 305 1,083 1,255 8,612 6,383 366 1,049 3,839 1,129 2,229 July 24 ._ 14,489 5,728 2,749 203 123 307 1,083 1,256 8,761 6,535 405 1,042 3,957 1,131 2,226 July 31 - 14, 489 5,729 2,743 205 117 307 1,087 1,261 8,760 6,527 402 1,047 1,129 2,233 Aug. 7 14, 574 5,726 2,738 207 109 307 1,088 1,268 6,603 397 1,056 3,950 1,200 2,245 Aug. 14 14, 601 5,752 2,758 212 106 305 1,089 1,271 8,849 6,602 404 1,053 3,940 1,205 2,247 Aug. 21 14, 580 5,758 2,764 212 104 307 1,091 1,270 8,822 6,573 392 1,054 3,917 1,210 2,249 Aug. 28 14, 589 5,772 2,772 217 104 305 1,091 1,274 8,817 6,567 1,051 3,918 1,210 2,250 Sept. 4 14, 589 5,801 2,789 217 109 301 1,095 1,280 6,559 382 1,048 3,918 1,211 2,229 Sept. 11 14, 616 5,839 2,829 220 107 297 1,096 1,283 8,777 6,546 380 1,045 3,908 1,213 2,231 Sept. 18 14, 593 5,859 2,828 222 109 298 1,098 1,295 8,734 6,494 354 1,046 3,887 1,207 2,240 Sept. 25 14, 570 5,861 2,822 221 114 1,100 1,297 8,709 6,465 345 1,042 3,883 1,195 2,244 NOTE.—For description of figures see BULLETIN for November 1935 (pp. 711-738) or reprint, and BULLETIN for June 1937 (pp. 530-531). For back figures see BULLETIN for November 1935 (pp. 711-738) or reprint, BULLETIN for December 1935 (p. 876), Annual Report for 1937 (tables 65-67) and corresponding tables in previous Annual Reports. 1114 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

WEEKLY REPORTING MEMBER BANKS—NEW YORK CITY AND OUTSIDE RESERVES AND LIABILITIES [Monthly data are averages of Wednesday figures. In millions of dollars.] Demand deposits, Time deposits, Interbank except interbank except interbank deposits Reserves Bal- De- Indi- Indi- Domestic B s w F e a e R e r n r i e a t d v - k h l - e s v C a i a n u s l h t b m a w a n d e o n i c s - t e k h ti s s c j m p u o a s d a e t d s - e n i - d t d s ) s p u v n h a c a a o i e n i d l p r r r d s t - - - s - , , S p d s a i t u o i n c a b v l d a - t i i e l t - - s c C h c o f a e e e i n f e c f d r r i d s t k - i ' s - , u G e . r o n v s - - . s p u v h n a c a a o i n e i d l r p r r d s t - - - s - , , S p d s a i t u o c i a n b v l a t - d i i e l t - - s P in s o a g s v s t - a ' l ' m D a e n - b d ank T s ime b F e a i o n g r k n - s r B i o n o w g r s - - c C o i a a u t c p a - n - l ts Date or month pora- sions etc. pora- sions tions tions Total 101 Cities 8,951 440 2,808 17, 717 17,168 1,436 438 532 5,021 220 6,991 127 652 3,722 1939—August 10,661 465 3,229 19, 515 19,058 1,403 461 561 5,147 186 8,295 117 725 3,735 1940—April 11,032 474 3,240 19, 971 19,460 1,540 481 560 5,119 192 8.380 115 708 3,750 May 11,500 499 3,262 20, 524 20,034 1,494 402 561 5,127 183 8,361 113 688 3,773 June 11, 600 491 3,214 20,847 20,380 1, 455 411 475 5,141 178 8,310 111 676 3,774 July 11,316 3,163 20, 878 20, 319 1,466 360 506 5,155 182 8,258 111 684 3,783 August 11,660 512 3,208 20,824 20,302 1,452 381 439 5,139 180 111 671 3, 777 July 10 11,729 491 3,262 20, 932 20,532 1,425 396 407 5,138 176 8,418 110 673 3,772 July 17 11, 526 498 3,181 20, 984 20,401 1, 465 423 509 5,139 174 8,196 112 676 3,773 July 24 11, 449 478 3,140 20,984 20,499 1,497 388 505 5,144 175 8,129 110 676 3,776 July 31 11, 212 488 3,113 20, 712 20,101 1,476 343 505 5,150 183 8,221 112 685 3,782 Aug. 7 11, 254 505 3,168 20, 789 20,369 1,427 373 506 5,154 180 8,280 112 690 3,781 Aug. 14 11,348 490 3,173 20, 956 20, 381 1,478 381 506 5,161 183 8,252 110 679 3,783 Aug. 21 11, 449 3,201 21,053 20, 424 1,482 344 506 5,156 183 8,282 110 682 3,787 Aug. 28 11,418 3,171 20, 901 20, 415 1,440 393 509 5,174 182 8,395 110 670 3,790 Sept. 4 11,471 3,226 21, 079 20, 738 1,410 349 505 5,174 184 8,459 111 671 3,783 Sept. 11 11, 490 502 3,296 20, 984 20, 617 1,413 388 508 5,175 178 8,576 111 683 3,781 Sept. 18 11,616 3, 24821,080 20,610 1,421 452 507 5,178 172 8,429 112 692 3,781 Sept. 25 New York City 5,184 7,905 7,913 304 274 597 3,052 575 1,482 1939—August 6,259 9,087 9,154 246 282 661 3,640 663 1,496 1940—April 6,384 9,203 9,306 267 292 634 3,727 650 1,502 May 6,622 9,524 9,653 213 224 647 3,724 634 1,500 June 6,657 9,716 9,770 280 225 657 3,717 622 1,489 July 6,417 9,678 278 195 668 3,629 1,495 August 6,719 9,776 9,756 314 209 655 3,700 616 1,489 July 10 6,663 9,710 9,776 272 193 656 3,735 620 1,489 July 17 6,635 9,776 9,779 280 248 658 3,685 623 1,489 July 24 6,549 9,753 9,844 283 206 659 3,684 620 1,493 July 31 6,380 9,634 9,641 264 179 663 3,624 629 1,495 Aug. 7 6,394 9,620 9,683 255 205 667 3,630 634 1,494 Aug. 14 6,422 9,732 9,723 296 221 670 3,622 624 1,495 Aug. 21 6,470 9,727 9,705 295 177 671 3,640 1,495 Aug. 28 6,401 9,672 9,704 263 216 3,654 617 1,495 Sept. 4 6,391 9,681 9,799 225 184 3,707 618 1,493 Sept. 11 6,417 9,655 9,728 254 210 3,758 630 1,492 Sept. 18 6,474 9,685 9,729 252 279 3,687 636 1,491 Sept. 25 Outside New York City 3, 767 377 2,734 9,812 9,255 1,132 164 481 4,424 170 3,939 127 2,240 1939—August 4,402 387 3,134 10,428 9,904 1,157 179 516 4,486 159 4,655 117 2,239 1940—April 4,648 395 3,153 10,768 10,154 1,273 189 516 4,485 166 4,653 115 2,248 May 4,878 417 3,179 11,000 10, 381 1,281 178 518 4,480 159 4,637 113 2,273 June 4,943 410 3.132 11,131 10, 610 1,175 186 442 4,484 151 4,593 111 2,285 July 4,899 416 3,084 11, 200 10, 631 1,188 165 471 4,487 142 4,629 111 August 4,941 429 3,128 11,048 10,546 1,138 172 410 4,484 154 4,639 111 2,288 July 10 5,066 409 3,175 11, 222 10, 756 1,153 203 381 4,482 150 4,683 110 2,283 July 17 4,891 418 3,098 11, 208 10, 622 1,185 175 474 4,481 147 4,511 112 2,284 July 24 4,900 399 3,061 11,231 10, 655 1,214 182 470 4,485 147 4,445 110 2,283 July 31 4,832 408 3,034 11,078 10,460 1,212 164 470 4,487 146 4,597 112 2,287 Aug. 7 4,860 420 3,089 11,169 10, 686 1,172 168 471 4,487 142 4,650 112 2,287 Aug. 14 4,926 410 3,093 11, 224 10,658 1,182 160 471 4.491 143 4,630 110 2,288 Aug. 21 4,979 423 3,123 11, 326 10, 719 1,187 167 471 4,485 140 4,642 110 2,292 Aug. 28 5,017 407 3,090 11, 229 10, 711 1,177 177 474 4,488 138 4,741 110 2,295 Sept. 4 5,080 432 3,146 11, 398 10, 939 1,185 165 470 4,489 139 4,752 111 2,290 Sept. 11 5,073 420 3,214 11, 329 10,889 1,159 178 473 4,494 138 4, 818 111 2,289 Sept. 18 5,142 424 3,166 11,395 10,881 1,169 173 472 4,497 132 4,742 112 2,290 Sept. 25 1 Demand deposits other than interbank and U. S. Government, less cash items reported as in process of collection. 2 U. S. Treasurer's time deposits, open account, are combined with postal savings (time) deposits. OCTOBER 1940 1115 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

WEEKLY REPORTING MEMBER BANKS—BY FEDERAL RESERVE DISTRICTS LOANS AND INVESTMENTS [In millions of dollars] Loans Investments Loans for U. S. Government obligations Com- purchasing Total mer- or carrying Federal Reserve loans cial, securities distric (1 t 9 a 4 n 0 d ) date v a i e n n s d - t- Total t d r i u i n a s - - l, O m k p a e e r t n - To e l R o st a e a n a t l s e b L a o t n o a k n s s O lo t a h n e s r Total Guar- O se t c h u e - r ments and paper bro- Total Bills Notes Bonds an- rities agri- kers To teed cul- and others tural dealers Boston (6 cities) Aug. 28 1,188 616 11 18 137 572 445 338 54 127 Sept. 4 1,189 621 308 11 18 137 568 442 338 53 126 Sept. 11 1,181 623 310 11 18 137 558 433 331 53 125 Sept. 18 1,183 625 312 11 18 137 558 433 331 53 125 Sept. 25 1,184 622 308 12 18 137 562 436 12 332 54 126 New York (8 cities)* Aug. 28 10, 443 3,091 1,813 263 212 203 485 7,352 5,769 337 1,121 2,866 1,445 1,583 Sept. 4 10, 474 3,120 1,814 285 212 203 489 7,354 5,765 336 1,105 2,878 1,446 1,589 Sept. 11 10, 560 3,183 1,866 290 213 203 490 7,377 5,789 343 1,104 2,895 1,447 1,588 Sept. 18 10, 575 3,194 1,875 301 214 203 488 7,381 5,763 331 1,102 2,881 1,449 1,618 Sept. 25 10, 480 3,193 1,884 305 213 202 485 7,287 5,677 278 1,073 2,871 1,455 1,610 Philadelphia (4 cities) Aug. 28 1,^206 474 228 22 31 50 106 732 454 33 329 92 278 Sept. 4 1,204 473 226 22 31 50 106 731 455 33 328 94 276 Sept. 11 1,202 474 227 21 31 50 107 728 454 34 326 94 274 Sept. 18 1,202 474 226 21 31 50 107 728 453 34 325 94 275 Sept. 25 1,202 474 226 22 31 50 107 728 453 34 324 95 275 Cleveland (10 cities) Aug. 28 1,907 713 282 13 24 178 207 1,194 912 166 615 131 282 Sept. 4 1,908 715 282 14 24 179 208 1,193 912 165 615 131 281 Sept. 11 1,919 726 293 13 24 179 208 1,193 913 162 619 131 280 Sept. 18 1,918 731 295 14 24 179 210 1,187 905 161 613 130 282 Sept. 25 1,918 728 291 15 24 179 210 1,190 909 157 617 134 281 Richmond (12 cities) Aug. 28 713 277 125 11 2 14 44 80 436 367 169 132 Sept. 4. 713 279 124 11 3 14 45 81 434 365 166 133 Sept. 11 715 280 126 11 3 14 45 81 435 366 166 133 Sept. 18 718 281 126 11 3 14 46 81 437 368 167 133 Sept. 25 709 285 128 11 4 14 46 82 424 355 158 134 69 Atlanta (8 cities) Aug. 28 _ 632 311 152 2 5 11 107 321 215 2 38 108 106 Sept. 4 638 313 153 2 5 11 33 108 325 218 3 39 108 107 Sept. 11 640 314 154 2 5 10 33 109 326 219 4 39 108 107 Sept. 18 643 316 155 2 5 10 33 110 327 219 3 41 108 67 108 Sept. 25 642 316 156 2 5 10 33 109 326 217 3 40 107 67 109 Chicago (12 cities)* Aug. 28 3,481 970 589 40 27 123 2,511 1,966 306 304 1,042 314 545 Sept. 4 3,482 981 593 41 31 124 2,501 1,957 301 301 1,042 313 544 Sept. 11 3,483 602 42 29 124 124 2,494 1,948 297 303 1,036 312 546 Sept. 18 3,435 596 42 28 125 128 2,448 1,903 270 303 1,018 312 545 Sept. 25-— 3, 404 981 588 42 30 125 128 2,423 1,880 264 311 1,011 294 543 St. Louis (5 cities) Aug. 28 703 327 181 10 4 55 62 376 268 10 39 147 72 108 Sept. 4 704 328 182 10 3 55 63 376 269 11 39 147 72 107 Sept. 11 707 329 183 10 4 55 63 378 270 11 39 148 72 108 Sept. 18 708 330 182 10 4 56 63 378 270 11 38 149 72 108 Sept. 25 712 330 182 9 4 57 64 382 273 12 39 150 72 109 Minneapolis (8 cities) Aug. 28 391 187 93 3 1 11 72 204 162 28 110 24 42 Sept. 4 396 191 3 1 11 72 205 162 28 110 24 43 Sept. 11 399 194 3 1 12 72 205 162 27 110 25 43 Sept. 18 401 196 100 3 1 12 73 205 163 28 111 24 42 Sept. 25 405 197 101 3 1 11 74 165 27 112 26 43 Kansas City (12 cities) Aug. 28_._ 691 310 181 23 3 30 381 246 67 91 76 135 Sept. 4__ 310 182 22 3 30 64 378 244 67 76 134 Sept. 11 311 183 22 3 30 64 378 245 67 76 133 Sept. 18 689 313 183 22 3 29 66 376 243 67 75 133 Sept. 25 691 313 182 3 31 65 378 244 76 134 Dallas (9 cities) Aug. 28 530 269 177 2 23 50 261 203 39 58 Sept. 4 531 271 178 2 23 51 260 202 58 Sept. 11 532 273 180 2 23 51 259 201 58 Sept. 18.. 533 272 179 2 23 51 261 203 58 Sept. 25. 536 275 181 2 23 52 261 203 58 San Francisco (7 cities) Aug. 28 2,272 338 10 385 171 1,308 962 66 346 Sept. 4 2,261 964 342 10 386 170 1,297 966 70 700 193 331 Sept. 11.... ... 2,267 348 10 386 170 1,298 964 70 698 194 334 Sept. 18.... 2,279 973 349 11 386 171 1,306 965 70 702 191 341 Sept. 25 2,283 975 348 12 386 171 1,308 967 72 701 192 341 City of Chicago* Aug. 28 2,305 430 23 18 56 1,697 1,338 160 729 143 359 Sept. 4 2,303 617 433 27 18 58 1,686 1,330 301 158 728 143 356 Sept. 11 2,301 623 441 25 18 58 1,678 1,320 297 158 722 143 358 Sept. 18. 2,251 620 434 24 18 63 1,631 1,275 270 158 704 143 356 Sept. 25 2,217 612 425 25 18 1,605 1,252 264 162 702 124 353 * Separate figures for New York City are shown in the immediately preceding table, and for the city of Chicago in this table. The figures for the New York and Chicago districts, as shown in this table, include New York CJiitty; and* C ~h"i cago, respectivel"y. 1116 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

WEEKLY REPORTING MEMBER BANKS—BY FEDERAL RESERVE DISTRICTS RESERVES AND LIABILITIES [In millions of dollars] Demand deposits Time deposits, Interbank except interbank except interbank deposits Reserves Bal- De- Indi- Indi- Domestic B s w F e a R e e r i n e r a t - d v k h l - e s v C a i a n u s l h t b m a w n a d e o i n c s - t e k h t s i s c j m p u o s d a a e t s d - e n i - d t d s i s p u p v n h a c a a o i e o n i d l r p r r r d s t a - - - s - , - , S p s d s a i t o i u c i a n o b v l a t - d n i e i l t - s - s c C h c f a o e e e i e t f n c e f r c r . d i d t s k - i ' - s m U G er o . e n S v n - . - t2 s p p u v n h a c o a a i e o n i d r r l p r r d s a t - - - s - , - , S p s d s a i t i o u i c a o n b v l a t - n d i i e l t - s - s P in s o a g s v s t - a 2 l m D a e n - b d ank T s ime b F e a i o n g r k n - s r B i o n o w g r s - - c C o i a a t u c p a - - n l ts d F i e s d tr e ic ra t l ( a 1 R n 9 d e 4 s 0 e ) d r a v t e e tions tions Boston (6 cities) 650 145 180 1,335 1,281 94 15 11 233 2 1 370 17 1 245 Aug. 28 670 144 179 1,344 1,305 88 18 12 232 2 1 380 16 246 Sept. 4 668 147 187 1,343 1,305 87 18 11 232 2 1 382 17 246 Sept 11 669 145 189 1,328 1,303 83 18 12 233 2 1 394 18 1 246 Sept. 18 665 146 184 1,331 1,291 84 20 12 233 2 1 386 18 1 246 Sept. 25 New York (8 cities)* 6,628 104 215 10,376 10,226 443 191 53 1,038 48 7 3,718 16 628 1,617 Aug. 28 6,567 103 221 10,331 10,224 427 230 53 1,052 49 7 3,734 16 618 1,618 Sept. 4 6,552 106 220 10, 363 10, 330 401 201 53 1,051 50 7 3,786 16 619 1,615 Sept. 11 6,576 102 224 10,332 10,260 419 230 53 1,048 45 7 3,838 16 631 1,615 Sept. 18 6,638 104 225 10, 366 10, 270 421 296 53 1,048 45 7 3,766 16 637 1,613 Sept. 25 Philadelphia (4 cities) 478 21 209 1,019 997 70 8 47 259 3 424 9 4 215 Aug. 28 476 20 208 1,004 995 65 7 47 259 3 433 9 5 215 Sept. 4 482 21 205 1,002 1,001 65 9 46 258 3 437 9 5 215 Sept. 11 485 21 216 1,002 1,001 63 9 47 258 3 450 9 4 214 Sept. 18 477 21 216 1,009 1,005 60 8 47 258 3 434 9 5 214 Sept. 25 Cleveland (10 cities) 707 47 338 1,438 1,397 113 21 42 718 27 435 37 1 381 Aug. 28 721 47 341 1,440 1,399 111 18 43 719 27 449 37 1 381 Sept 4 730 49 339 1,463 1,441 112 18 42 718 27 446 37 1 381 Sept. 11 714 49 341 1,447 1,412 123 19 43 717 26 447 37 1 380 Sept. 18 714 48 343 1,448 1,395 122 21 43 717 26 448 37 1 380 Sept. 25 Richmond (12 cities) 202 24 237 549 520 57 12 32 200 3 1 293 5 99 Aug. 28 208 21 228 533 520 52 12 32 200 3 1 303 5 100 Sept. 4 213 25 236 546 540 51 11 32 200 3 1 308 5 100 Sept. 11 216 23 240 546 535 53 14 32 200 3 1 316 5 98 Sept. 18 220 24 252 547 540 55 12 32 200 3 1 318 6 100 Sept. 25 Atlanta (8 cities) 148 15 204 439 411 67 3 41 184 6 2 267 3 2 95 Aug. 28 147 13 198 429 411 65 5 41 185 5 2 275 3 1 95 Sept. 4 149 14 209 443 424 63 4 41 185 5 2 277 3 2 94 Sept. 11 146 14 208 434 423 60 5 41 185 5 2 285 3 2 95 Sept. 18 141 14 209 435 416 64 4 41 185 4 2 281 3 1 95 Sept. 25 Chicago (12 cities)* 1,506 78 600 2,885 2,683 331 37 130 953 16 8 1,314 10 8 399 Aug. 28 1,497 75 587 2,848 2,650 335 38 130 954 16 8 1,328 10 8 400 Sept. 4 1,533 78 581 2,891 2,711 340 31 130 954 16 8 1,319 10 8 401 Sept. 11 1,559 76 604 2,875 2,700 328 37 130 956 16 8 1,326 10 s 401 Sept. 18 1,626 76 592 2,914 2,723 329 35 130 956 16 8 1,308 10 9 402 Sept. 25 St. Louis (5 cities) 239 13 173 503 500 39 8 13 187 3 2 341 1 94 Aug 28 237 11 177 496 502 37 9 14 187 3 2 349 1 94 Sept. 4 237 13 178 506 513 38 8 13 187 3 2 345 1 94 Sept. 11 236 12 176 499 509 36 8 13 187 3 2 348 1 95 Sept. 18 239. 13 169 507 512 36 9 13 187 3 2 341 1 95 Sept. 25 Minneapolis (8 cities) 106 7 144 309 271 60 7 1 117 1 166 2 1 60 Aug. 28 106 6 145 309 276 60 7 1 116 1 171 2 1 61 Sept. 4 105 7 146 310 281 58 6 1 117 1 173 2 1 61 Sept. 11 101 7 140 307 278 55 6 1 117 1 168 2 1 61 Sept. 18 102 7 130 306 280 57 6 1 117 1 164 2 1 60 Sept. 25 Kansas City (12 cities) 197 17 316 556 527 76 9 18 143 3 1 408 6 106 Aug. 28 198 16 317 544 532 75 10 18 143 3 1 419 6 105 Sept. 4 207 18 322 560 544 71 9 18 143 3 1 418 7 106 Sept. 11 198 17 345 560 548 72 9 19 143 3 1 431 6 106 Sept. 18 198 18 331 561 538 72 9 18 143 3 1 419 6 106 Sept. 25 Dallas (9 cities) 137 12 281 487 474 42 8 32 126 9 243 1 88 Aug. 28 141 11 279 488 475 43 12 32 126 8 1 244 1 88 Sept. 4 136 12 288 491 485 '41 8 32 126 8 1 248 1 88 Sept. 11 134 12 297 493 488 39 11 32 126 8 1 253 1 88 Sept. 18 137 12 286 492 483 40 10 32 126 8 1 248 1 89 Sept. 25 San Francisco (7 cities) 451 25 304 1,157 1,137 90 25 86 998 63 303 21 20 388 Aug. 28 450 24 291 1,135 1,126 82 27 86 1,001 63 310 21 19 387 Sept. 4 459 27 315 1,161 1,163 83 26 86 1,003 64 320 21 17 382 Sept. 11 456 24 316 1,161 1,160 82 22 85 1,005 64 320 22 17 382 Sept. 18 459 25 311 1,164 1,157 81 22 85 1,008 59 316 22 19 381 Sept. 25 City of Chicago* 1,200 43 258 1,970 1,873 181 21 89 493 14 5 1,003 7 255 Aug. 28 1,189 43 259 1,953 1,851 191 23 89 493 14 5 1,011 6 256 Sept. 4 1 219 43 257 1,981 1,881 201 17 89 492 14 5 1,008 7 257 Sept. 11 1,251 42 273 1,963 1,869 193 19 89 492 14 5 1,019 7 256 Sept. 18 1,297 42 261 1,977 1,877 190 20 89 492 14 5 1,002 8 258 Sept. 25 • See note on preceding page. 1 Demand deposits other than interbank and U. S. Government, less cash items reported as in process of collection. 2 U. S. Treasurer's time deposits, open account, are combined with postal savings (time) deposits. OCTOBER 1940 1117 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

COMMERCIAL PAPER AND BANKERS' ACCEPTANCES OUTSTANDING [In millions of dollars] Dollar acceptances outstanding Held by Based on Comm ci e a r l - Accepting banks Feder B al a n R ks eserve Goods stored in or End of month paper Total shipped between out- out- Im- points in stand- stand- For ac- ports Exports Dollar ing i ing For count of Others into from ex- Total O bi w ll n s bo B u il g ls ht o c w o n u n a t c- f s c o p e o r o n e r n i r t g s e d n - - U S n ta i t t e e s d U S n ta i t t e e s d change U St n a i t t e e s d F c o t o r r i u e e i n s g - n 1939—May 189 247 192 124 68 55 82 51 19 36 59 June 181 245 191 122 69 53 81 45 20 39 60 July 194 236 188 119 69 48 75 41 19 39 61 August 201 235 191 128 63 ii 44 79 40 18 40 59 September 209 216 177 115 62 39 78 40 18 43 36 October 205 221 179 111 67 42 85 40 18 46 32 November 214 223 172 103 69 51 96 37 16 50 24 December 210 233 175 105 70 57 103 39 16 54 22 1940—January 219 229 179 111 68 50 101 38 16 51 23 February 226 233 188 123 65 45 95 44 15 51 27 March 233 230 184 121 63 46 90 47 14 49 30 April 239 223 178 118 61 45 86 45 13 46 33 May 234 214 171 113 58 43 78 47 12 41 34 June 224 206 166 112 54 40 79 43 13 36 34 July 232 188 152 103 49 36 75 32 13 35 32 August 247 182 148 103 44 34 80 24 11 38 29 i As reported by dealers; includes some finance company paper sold in open market. » Less than $500,000. Back figures.—See Annual Report for 1937 (table 70). CUSTOMERS' DEBIT BALANCES, MONEY BORROWED, AND PRINCIPAL RELATED ITEMS OF STOCK EXCHANGE FIRMS CARRYING MARGIN ACCOUNTS [Member firms of New York Stock Exchange. Ledger balances in millions of dollars] Debit balances Credit balances Debit Debit cre C d u i s t t b o a m l e a r n s c ' es 1 Other credit balances End of month C b u ( a d s n l t e a e o b n t m ) c i t e i e s rs' a i b n n p a a v d l c a a e c r n s t t o r n t c u a m e e n d s r e t i s s n n i ' n g t a i b n n a a v d l c a e f c n i s t o r r c t u m a m e n d s e t i s n n in g t C a b h a n a s a d n h n k d i o s n n r M o b w o o n e r d e - y 2 Free O (n t e h t e ) r m p i a e n r n v t I t n n e a e st n r - s d ' m i e n f n v i I t r n e m a st n - d a c c a c p o In i u t n al ts trading trading (net) accounts accounts 1935—December. 1,258 135 179 930 286 79 10 410 1936—June 1,267 164 219 985 276 420 December. 1,395 164 249 1,048 342 103 424 1937—June 161 214 1,217 266 397 December. 985 108 232 278 355 1938—June 774 215 495 258 298 December. 991 106 190 754 247 305 1939—June 834 73 178 570 230 280 July 839 84 183 589 238 278 August 792 71 202 556 235 275 September. 856 64 217 520 305 283 October 894 72 200 577 289 284 November. 914 77 195 623 272 282 December. 906 78 207 637 266 277 1940—January ... 70 198 602 262 272 February.. 72 195 616 253 271 March 78 186 615 247 270 April 910 72 192 626 252 271 May. 702 67 239 459 251 274 June 653 58 223 376 267 269 July 642 64 213 376 261 2-64 August 631 56 215 368 256 260 i Excluding balances with reporting firms (1) of member firms of New York Stock Exchange and other national securities exchanges and (2) of firms' own partners. * Includes both money borrowed from banks and trust companies in New York City and elsewhere in the United States and also money borrowed from other lenders (not including member firms of national securities exchanges). NOTE.—For explanation of these figures see "Statistics on Margin Accounts" in BULLETIN for September 1936. The article describes the method by which the figures are derived and reported, distinguishes the table from a "statement of financial condition," and explains that the last column is not to be taken as representing the actual net capital of the reporting firms. Back See figures— BULLETIN for March 1938, p. 196, and (for data in detail) Annual Report for 1937 (table 69). 1118 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

OPEN-MARKET RATES IN NEW YORK CITY COMMERCIAL LOAN RATES [Per cent per annum] AVERAGES OF RATES CHARGED CUSTOMERS BY BANKS IN PRINCIPAL CITIES Prevailing rate 1 on— Average rate on— [Per cent per annum] Aver- 7 other CJ. S.Treas- age New North- 11 Southmo Y w n e e t e a h k r , , or m p P 4 c a r e o p i t r m o m c e i r - e 6 a , l a a b P c n e a c r r c n e i s e m k p s - t e , - c l S h t o i t e a a o m x n n c - e g s k , e c S h l c o t e r a o a e x a n l c - n - l g k e i N ss o e u u f w - e ry s bi d l d 9 l e s a 1 a y - l- y T i 3 U e y u r - l e t e . r d o a a y S - r s o 5 . - n 1934 average i 3 t t a . i 4 l e 5 s Y C o i 2 t r y . k 45 e E r c a n i s t t i 3 a e e . n s 7 rn d 1 W er c n e i s ti a t e e 4 n s r . d 3 n 2 months da 9 y 0 s da 90 ys n a e l w s - w fe i r t e h d in q e u r o s' - notes 1 1 9 9 3 3 6 5 a a v v e e r r a a g g e e 2 2 . . 9 6 3 8 1 1 . . 7 7 6 2 3 3 . . 3 0 9 4 3 3 . . 7 4 6 0 period2 tation 1 1 9 93 3 7 8 a a v v e e r r a a g g e e 2 2 . . 5 5 9 3 1 1. . 6 7 9 3 2 2 . . 8 7 8 5 3 3 . . 2 2 6 5 1939 averagel 2.78 2.07 2.87 3.51 1937 average. — .95 43 1.25 1.00 .447 .28 1.40 Monthly figures 1938 average... .81 .44 1.25 1.00 .053 .07 .83 1938—January 2.60 1.70 2.92 3.28 1939 average... .59 .44 1.25 LOO .022 .05 .59 February 2.49 1.70 2.65 3.21 1939— S A e u p g t . .6 5 9 6 . . 4 4 4 4 1 1 . . 2 2 5 5 1 1 .0 0 0 0 . . 0 1 4 0 6 2 . .1 0 4 5 1.0 4 7 8 A M M p a a r y r i c l h 2 2 2 . . . 4 4 4 8 8 8 1 1 1 . . . 7 6 7 0 5 0 2 2 2 . . . 6 6 6 4 0 4 3 3 3 . . . 2 2 2 8 5 0 1940— N M D F O Ja e o e c a n b c t v r . . . . . . . . 6 6 5 5 5 5 9 3 6 6 6 6 . . . . . . 4 4 4 4 4 4 4 4 4 4 4 4 1 1 1 1 1 1 . . . . . . 2 2 2 2 2 2 5 5 5 5 5 5 1 1 1 1 1 1 . . . . . 0 0 0 0 0 0 0 0 0 0 0 0 . . . . . 0 0 0 0 0 2 1 1 0 0 8 8 2 4 1 . . . . . . 0 0 0 0 0 0 1 5 2 2 4 5 . . . . , 6 4 4 5 4 7 4 6 2 1 7 7 J J A N S O u u e u o c n l p t y g v e o t u e e b m s m e t r b b e e r r 2 2 2 2 2 2 . . . . . . 5 5 5 5 4 5 7 6 2 7 9 3 1 1 1 1 1 1 . . . . . . 7 7 7 7 7 6 0 0 0 0 0 7 2 2 2 2 2 2 . . . . . . 7 7 7 9 6 7 8 8 4 0 8 1 3 3 3 3 3 3 . . . . . . 2 3 3 2 2 2 0 5 1 6 8 1 A M p a r y il .5 5 6 6 . . 4 4 4 4 1 1 . . 2 2 5 5 1 1 . . 0 0 0 0 . . 0 0 0 4 3 2 . . 0 0 2 6 . . 4 6 5 5 December 2.60 1.70 2.95 3.23 June .56 .44 1.25 1.00 .071 .10 .76 1939—January 2.64 1.73 2.97 3.32 J A u u l g y . . 5 5 6 6 . .4 4 4 4 1 1 . . 2 2 5 5 1 1 . . 0 0 0 0 . . 0 0 1 0 9 9 . . 0 0 4 5 . . 5 5 8 7 February 2.52 1.70 2.69 3.26 Quarterly figures Week ending: 1939—March 2.95 2.13 3.05 3.77 Aug. 31- Vie 1J4 1.00 .036 .05 .54 June 2.91 2.15 3.05 3.62 Sept. 7_. Vie 1.00 .038 .05 .50 September... 2.68 2.04 2.78 3.31 S S e e p p t t . . 2 1 1 4 - . %~% V V i i e e V il4 4 1 1 . . 0 0 0 0 . . 0 0 3 1 2 3 . . 0 0 4 5 . . 5 5 0 0 1940— D M e a c r e c m h ber 2 2 . . 6 5 5 9 2 1. . 9 0 6 3 2 2 . . 5 6 9 7 3 3 . . 3 3 2 5 Sept. 28. Vie 1% 1.00 .000 .04 .45 June 2.59 2.00 2.49 3.38 i Monthly figures are averages of weekly prevailing rates. i Averages for 1939 and quarterly figures are on revised basis and are »Series comprises 273-day bills to October 15, 1937, bills maturing therefore not strictly comparable with the earlier series of annual and about March 16,1938, from October 22, to December 10,1937, and 91-day monthly figures. bills thereafter. 1 Rate negative. Back figures—See November 1939 BULLETIN, pp. 963-969 for descrip- Back figures.—Bee Annual Report for 1937 (tables 43 and 44). Figures tion and for back figures. for Treasury bills and Treasury notes available on request. BOND YIELDS * [Per cent per annum] Corporate * U.S. Year, month, or week T u r r e y a 2 s- M ip u a n l i 3 c- By ratings By groups Total Indus- Rail- Public Aaa Baa trial road utility Number of issues. 2-6 30 30 30 40 1937 average 2.68 3.10 3.94 3.26 3.46 4.01 5.03 3.55 4.34 3.93 1938 average 2.56 2.91 4.19 3.19 3.56 4.22 5.80 3.50 5.21 3.87 1939 average _. 2.36 2.76 3.77 3.01 3.22 3.89 4.96 3.30 4.53 3.48 1939—August 2.21 2.75 3.67 2.93 3.11 3.80 4.85 3.21 4,41 3.40 September. 2.65 3.29 3.95 3.25 3.49 4.05 5.00 3.57 4.58 3.70 October 2.60 3.08 3.83 3.15 3.35 3.94 4.88 3.43 4.51 3.57 November.. 2.46 2.69 3.70 3.00 3.16 3.78 4.85 3.25 4.44 3.41 December... 2.35 2.56 3.69 2.94 3.14 3.74 4.92 3.21 4.47 3.38 1940—January 2.30 2.54 3.63 2.88 3.08 3.69 4.86 3.14 4.39 3.35 February- 2.32 2.60 3.60 2.86 3.05 3.68 4.83 3.12 4.37 3.33 March 2.25 2.58 3.58 2.84 3.04 3.65 4.80 3.09 4.37 3.29 April 2.25 2.56 3.54 2.82 2.99 3.59 4.74 3.05 4.33 3.24 May 2.38 2.81 3.65 2.93 3.08 3.65 4.94 3.20 4.46 3.30 June. 2.39 2.85 3.72 2.96 3.10 3.70 5.11 3.25 4.57 3.33 July 2.28 2.54 3.57 2.88 3.01 3.57 4.80 3.15 4.32 3.23 August 2.25 2.49 3.55 2.85 3.03 3.55 4.76 3.12 4.30 3.23 Week ending: Aug. 31 2.23 2.51 3.55 2.84 3.03 3.55 4.75 3.11 4.31 3.22 Sept. 7 2.20 2.48 3.52 2.84 3.02 3.53 4.70 3.10 4.27 3.20 Sept. 14.— 2.20 2.45 3.52 2.83 3.01 3.53 4.69 3.10 4.26 3.19 Sept. 21 2.17 2.44 3.51 2.82 3.01 3.53 4.68 3.10 4.24 3.19 Sept. 28 2.15 2.39 3.49 2.81 3.01 3.51 4.62 3.09 4.20 3.18 i Monthly and weekly data are averages of daily figures, except for municipal bonds, which are based on Wednesday figures. 1 Average of yields of all outstanding bonds due or callable after 12 years. » Standard Statistics Co. * Moody's Investors Service, week ending Friday. Because of limited number of suitable issues, the industrial Aaa and Aa groups have each been reduced from 10 to 4, and the railroad Aaa group from 10 to 5. Back figures.—See Annual Report for 1937 (table 80). Figures for U. S. Treasury bonds available on request. OCTOBER 1940 1119 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

BOND PRICES1 STOCK MARKET I Corporate 3 Stock prices * Vol- U. S. ume of Year, month, or date Treas- Munic- tradury 2 ipal Indus- Rail- Public Year, month, or Common (index, 1926=100) ing* Total trial road utility date Pre- (in ferred 2 thou- Indus- Rail- Public sands of Number of issues 2-6 20 20 20 Total trial road utility shares) 1937 average 101.7 110.3 93.4 90.1 100.4 1938 average 103.4 113.7 78.9 82.9 58.6 95.3 Number of issues.. 20 420 348 32 40 1939 average 106.0 116.3 81.6 86.0 58.0 100.9 1937 average 136.2 131 1,519 1939—August 108.2 116.5 81.0 85.8 55.5 101.7 1938 average _._ 135.6 99 1,100 September- 101.9 107.1 80.9 85.0 59.0 98.6 1939 average 141.2 105 973 October 102.6 110.7 82.9 86.4 61.6 100.5 November. 104.6 117.5 83.0 87.0 60.2 101.8 1939—August 142.3 101 706 December.. 106.1 119.9 82.1 86.8 58.0 101.6 September. __ 136.2 109 2,595 1940—January 106.8 120.2 82.4 87.3 58.2 101.8 October 137.7 113 1,050 February.. 106.6 119.1 82.2 87.3 57.8 101.6 November..- 140.7 111 907 March 107.5 119.7 82.1 87.3 57.2 101.8 December..- 141.4 108 808 April 107.6 119.8 82.5 87.5 58.2 101.7 1940—January 143.0 109 678 May 105.6 115.3 79.4 85.3 53.5 99.3 February 142.9 107 654 June 105.4 114.6 78.5 84.7 52.0 98.7 March 141.8 108 740 July 106.5 120.4 81.2 86.3 57.1 100.2 April 142.3 109 1,131 August 105.8 121.2 81.5 57.5 100.2 May 138.2 97 1,651 June 133.2 85 708 Aug. 28..- 105.9 120.8 81.7 87.1 57.6 100.4 July 136.9 87 310 Sept. 4 106.4 121.4 82.3 87.1 59.1 100.6 August 137.3 317 Sept. 11 106.6 122.0 82.3 87.4 58.9 100.7 Sept. 18.... 106.9 122.2 82.7 87.7 59.8 100.6 Aug. 28 137.4 363 Sept. 25 107.3 123.5 83.4 61.0 100.7 Sept. 4 138.2 798 Sept. 11 139.1 415 Sept. 18 139. 3 422 1 Monthly data are averages of daily figures except for municipal bonds, Sept. 25 139.6 649 which are averages of Wednesday figures. 2 Average prices of all outstanding bonds due or callable after 12 years, based on quotations from Treasury Department. Prices expressed in i Standard Statistics Co. Monthly data are averages of Wednesday decimals. 3 Prices derived from average yields, as computed by Standard Sta- 2 Average prices of industrial high-grade preferred stocks, adjusted to a tistics Co. $7 annual dividend basis. Back figures.—See Annual Report for 1937 (table 79). Figures for U. S. 1 Average daily volume of trading in stocks on the New York Stock Treasury bonds available on request. Exchange. Weekly figures are averages for the week ending Saturday. Back figures—For stock prices, see Annual Report for 1937 (table 79). CAPITAL ISSUES [In millions of dollars] ]For new capital For refunding Total Domestic Domestic (new Total Year or and (do- Total month re- mestic State Fed- Corporate (do- State Fed- Corporate fund- and and eral For- mestic and eral Foring) for- Total mu- agen- eign 2 and Total mu- agen- eign 2 eign) nici- cies J Bonds for- nici- cies 1 Bonds pal Total and Stocks eign) pal Total and Stocks notes notes 1930 7,619 6,912 6,004 1,434 87 4,483 2,980 1,503 908 706 527 53 0 474 451 23 179 1931 _ 4,038 3,095 2,860 1,235 75 1,551 1,239 311 235 944 893 21 51 821 789 32 51 1932 1,751 1,197 1,165 762 77 325 305 20 32 554 498 87 93 319 315 4 56 1933 1,063 720 708 483 64 161 40 120 12 343 283 37 26 219 187 32 60 1934 2,160 1,386 1,386 803 405 178 144 35 0 774 765 136 317 312 312 0 9 1935 4,699 1,457 1,409 855 150 404 334 69 48 3,242 3,216 365 987 1,864 1,782 81 26 1936 6,214 1,972 1,949 735 22 1,192 839 352 23 4,242 4,123 382 353 3,387 3,187 200 119 1937 3,937 2,138 2,094 712 157 1,225 817 408 44 1,799 1,680 191 281 1,209 856 352 119 1938 4,449 2,360 2,325 971 481 873 807 67 35 2,089 2,061 129 665 1,267 1,236 31 28 1939 5,839 2,287 2,237 931 924 382 285 97 50 3,552 3,464 195 1,537 1,732 1,595 137 88 1939—Aug 449 102 82 56 0 26 23 3 20 347 332 13 18 301 292 9 15 Sept.... 180 42 42 16 10 16 14 2 0 138 138 8 51 79 79 0 0 Oct 743 338 338 42 276 20 14 6 0 404 403 10 235 157 157 2 Nov.... 218 89 89 67 0 22 15 6 0 130 130 13 26 91 88 3 0 Dec 335 98 98 68 0 31 21 9 0 237 237 22 19 196 189 7 0 1940—Jan 287 94 94 59 0 35 19 16 0 193 193 26 29 137 102 36 0 Feb 451 104 104 58 1 45 43 3 0 347 347 114 22 211 196 14 0 Mar..._ 241 71 70 34 6 31 16 15 1 169 169 49 17 104 90 14 0 Apr 345 118 118 58 6 54 31 23 0 227 227 18 17 192 154 38 0 May.... 250 122 122 30 3 89 80 10 0 128 128 20 25 83 83 0 0 June 226 82 82 70 2 9 8 2 0 145 145 13 29 102 102 (3) 0 July.... 690 396 396 62 289 45 43 2 0 294 294 20 48 226 223 3 0 Aug 281 129 129 61 0 68 53 15 0 152 152 13 28 111 107 4 0 1 Includes publicly-offered issues of Federal credit agencies, but excludes direct obligations of U. S. Treasury. 2 Includes issues of noncontiguous U. S. Territories and Possessions. 3 Less than $500,000. Source.—For domestic issues, Commercial and Financial Chronicle; for foreign issues, TJ. S. Department of Commerce. Monthly figures subject to revision. Back figures.—See Annual Report for 1937 (table 78). 1120 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

UNITED STATES GOVERNMENT DEBT—VOLUME AND KIND OF DIRECT OBLIGATIONS [On basis of daily statements of United States Treasury. In millions of dollars] Interest-bearing Noninterestbearing Publicly-offered 1 Total End of month g d r e o b s t s Bonds ju A st d e - d So se c - ial All Main T t o e t r a e l st Total Notes Bills service i c s u su ri e t s y 4 others t d u e r b ed t Other bearing Pre- Treas- U. S. war savings 1932—June 19,487 19,161 «18,816 753 13, 460 1,261 616 105 240 266 1933—June 22, 539 22,158 •21,782 753 13,417 4,548 954 92 284 66 315 1934—June 27,053 26,480 626,006 753 15, 679 6,653 1,404 118 356 54 518 1935—June . 28,701 27, 645 26,910 753 14,019 62 10,023 2,053 156 580 231 825 1936— June-!—. 33,779 32,989 31,297 79 17,168 316 11,381 2,354 1,071 19 601 169 620 1937—June 36,425 35,800 33, 734 79 19,936 800 10, 617 2,303 926 579 560 119 506 1938—June _. 37,165 36, 576 33,463 79 21, 846 1,238 9,147 1,154 868 1,601 644 141 447 1939—June _. 40,440 39,886 35, 715 79 25,218 1,868 7,243 1,308 839 2,511 820 142 411 1939—July 40,661 40,114 35, 798 79 25, 218 1,949 7,243 1,309 833 2,542 941 140 408 August 40,891 40,351 35,862 79 25,218 2,015 7,243 1,307 829 2,722 938 133 406 September. 40,858 40, 342 35,886 79 25, 218 2,051 7,232 1,306 795 2,746 915 112 404 October.... 41,036 40,526 79 25, 218 2,092 7,232 1,405 791 2,796 912 109 401 November. 41, 305 40,807 36,123 79 25, 218 2,140 7,232 1,454 791 2,981 911 98 400 December. 41, 942 41,445 36,826 79 26,881 2,209 6,203 1,455 789 3,021 809 99 398 1940—January... 42,110 41, 601 36,957 79 26.896 2,473 6,203 1,307 787 3,049 807 114 395 February.. 42, 365 41,839 37,097 79 26.897 2,610 6,203 1,308 785 3,152 805 132 394 March 42,540 41,983 37,127 79 2,707 6,125 1,309 784 803 165 392 April 42,658 42,117 37,236 79 26,908 2,818 6,125 1,306 782 3,282 816 150 391 May __ 42,808 42,253 37,285 79 26,908 2,869 6,125 1,304 780 824 166 June 42, 968 42, 376 37, 223 79 26, 555 2,905 6,383 1,302 797 3,528 829 205 July 43, 771 43,186 37, 957 79 27, 226 2,966 6,384 1,302 773 3,536 198 August 43, 905 43, 317 38, 009 79 27, 236 3,008 6,384 1,303 771 3,622 205 1 Excludes postal savings bonds, formerly sold to depositors in the Postal Savings System. 2 Includes Liberty bonds. 3 Includes adjusted service bonds of 1945 and special issues of adjusted service bonds and of notes to Government Life Insurance Fund series and of certificates to the adjusted service fund. 4 Includes special issues to Federal old-age and survivors insurance trust fund, unemployment trust fund, and railroad retirement account. & Includes postal savings bonds and special issues to retirement funds, to Postal Savings System and to Federal Deposit Insurance Corporation. 6 Includes certificates of indebtedness not shown separately: 1932—$2,726,000,000, 1933—$2,108,000,000; 1934—$1,517,000,000. MATURITIES OF PUBLICLY-OFFERED DIRECT OBLIGATIONS, FULLY GUARANTEED OBLIGATIONS, BY AGENCIES * AUGUST 31,1940 [In millions of dollars] [In millions of dollars] Federal Home Recon- Com- U.S. Maturing End of Farm Owners' struction modity Hous- Total Mortgage Loan Finance Credit ing Bonds uionm Corpora- Corpora- Corpora- Corpora- Author- Date maturing Bonds call- tion tion 2 tion tion ity or callable able^ Total Bills Notes U. S. 1934—June.. 681 312 134 235 Sav- Other Dec. 3,063 980 1,834 249 ings 1935—June. _ 4,123 1,226 2,647 250 Dec. 4,494 1,387 2,855 252 1936—June. _ 4,718 1,422 3,044 252 1940—Before Oct 1 400 400 Dec... 4,662 1,422 2,988 252 Oct. 1-Dec. 31 1,639 902 737 1937—June 4,665 1,422 2,987 255 1941—Jan. l-Mar. 31— 677 677 545 Dec. 4,645 1,410 2,937 297 Apr. 1-June 30 504 504 1938—June- 4,853 1,410 2,937 299 206 July 1-Sept. 30 834 834 834 Dec. 4,992 1,388 2,888 509 206 Oct. 1-Dec. 31 204 204 1942 1,001 1,001 1939— May_. 5,409 1,379 2,888 820 206 114 1943 1,874 1,330 545 1,855 June__ 5,450 1,379 2,928 820 206 114 1944 _ 1,214 1,214 2,555 July.. 5,480 1,379 2,958 820 206 114 1945 2,833 718 174 1,941 1,755 Aug... 5,583 1,379 2,858 820 409 114 1946 . 1,852 317 1,534 2,359 Sept.. 5,455 1,279 2,830 820 409 114 1947 2,796 414 2,383 1,473 Oct.._ 5,448 1,279 2,823 820 409 114 1948 1,986 499 1,487 2,246 Nov. . 5,707 1,269 2,817 1,096 407 114 1949 1,645 826 819 2,278 Dec... 5,703 1,269 2,813 1,096 407 114 1950 1,350 2 779 571 1,186 1940—Jan... 5,699 1,269 2,809 1,096 407 114 1951. 1,223 1,223 3,500 Feb... 5,673 1,269 2,783 1,096 407 114 1952 2,436 2,436 Mar. _ 5,663 1,269 2,770 1,096 407 114 1953 2,904 2,904 Apr... 5,656 1,269 2,763 1,096 407 114 1954 2,663 2,663 681 May.. 5,535 1,269 2,641 1,096 407 114 1955 . 755 755 2,611 June.. 5,528 1,269 2,634 1,096 407 114 1956 1,170 1,170 982 July.. 5,526 1,269 2,631 1,096 407 114 1958 919 Aug... 5,811 1,269 2,626 1,096 696 114 1959 „ 982 982 1960 2,611 2,611 1,485 1961 50 50 50 1 Principal amount of obligations guaranteed as to interest and princi- 1963 919 919 pal. Excludes obligations held by U. S. Treasury and reflected in the 1965 1,485 1,485 public debt. The total includes guaranteed debentures of the Federal Housing Administrator, amounting to $8,800,000 on August 31, 1940. Total ___ 38,009 1,303 6,384 3,008 27, 314 27, 314 2 Excludes obligations guaranteed as to interest only. For August 1939 and subsequent months includes matured bonds not presented for retire- » Excludes U.S. savings bonds. Other bonds in the amount of $2,606,- ment amounting to $24,000,000 on August 31, 1940. 000,000 not callable prior to maturity are shown as of date of maturity. * Includes unclassified U. S. savings bonds. OCTOBER 1940 1121 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

SUMMARY OF TREASURY OPERATIONS [On basis of daily statements of United States Treasury. In millions of dollars] General and special accounts Trust Increase or deac- crease during Receipts Expenditures (excl. debt retirements) counts period etc.,2 excess Period Mis- A c g u r l- i- Un- Trans- E o x f c e e x s - s c o e f i p re ts c ta T o i x nn m e - s e n i c n e n e t o l a e l u a l r - - s s S t e a o i c x t c y u e ia r s - l o A th l e l r c 1 e r i o e p - t t a s l ce I r M i e p - t e s c 1 I d n e o e t s e n b t r t - t f i N e d o n e n a s - - a e l m t j A u u e r s d n a t - - t l m p e l r m e o e- n y - t - f c t e o r a r u u s c s n - t t o ts o A th l e l r Total* p t e u n r d es i- p ( t + e u e n ) r x e d - o s i- r f G b e u r a e n a l n d - l - d G e r b os ts s reve- Pro- lief etc.* <-) ance 2 nue gram Fiscal year ending: • June 1933. . 746 858 475 2,080 2,080 689 668 345 121 2,040 3,864 -1,784 -823 +445 +3,052 June 1934... 818 1,470 828 3,116 3,116 757 540 289 1,846 71 2,508 6,011 -2,896 +100 +1, 720 +4,514 June 1935. .. 1,099 1,657 1,044 3,800 3,800 821 710 712 2,351 71 2,345 7,010 -3, 209 +821 -741 +1,648 June 1936..- 1,427 2,010 680 4,116 4,116 749 912 533 2,309 1,814 2,.349 8,666 -4, 550 +312 +840 +5,078 June 1937— 2,163 2,181 '"253" 697 5,294 5,029 866 935 527 2,432 603 2,813 8,177 -3,149 +374 -128 +2, 646 June 1938.__ 2,640 2,279 755 567 6,242 5,855 926 1,028 362 1,914 220 2,789 7,239 -1,384 +306 —338 +740 June 1939.. . 2,189 2,232 740 507 5,668 5,165 941 1,163 787 2,595 182 3,040 8,707 -3, 542 +890 +622 +3, 275 June 1940... 2,125 2,345 838 617 5,925 5,386 1,041 1,559 1,020 1,919 208 3,251 8,998 -3, 612 +137 -947 +2, 528 1939—July. _ 42 187 36 43 308 265 15 109 55 186 124 274 764 -499 -113 -391 +222 Aug.. 38 217 119 46 420 372 18 114 45 172 18 406 774 -402 -44 -216 +230 Sept.. 329 311 27 52 719 676 151 108 68 139 7 268 741 -65 +46 -53 -34 Oct... 38 198 36 50 322 279 68 115 97 145 10 285 721 -442 -1 -264 +178 Nov.. 34 191 130 52 407 364 12 118 117 147 10 243 648 -284 +267 +252 +269 Dec... 319 171 29 50 569 521 190 125 102 162 10 243 832 -311 -16 +311 +637 1940—Jan... 45 167 45 57 315 315 38 132 119 157 *5 272 712 -398 +37 -194 +167 Feb.,. 63 154 178 49 444 444 19 129 128 145 10 238 668 -224 +36 +67 +256 Mar.. 665 192 30 46 934 799 146 143 105 173 255 822 -22 +11 +164 +175 Apr... 48 175 39 42 304 304 69 159 78 173 20 284 783 -479 +58 -303 +118 May. 40 179 137 43 400 400 10 154 62 169 4 248 647 -247 -83 -181 +150 June 464 201 32 88 784 648 305 153 43 151 235 887 —238 —61 -139 +160 July.. 50 237 39 41 367 331 20 177 54 151 114 303 818 -487 +51 +367 +803 Aug.. 38 346 139 43 566 447 20 200 76 142 25 243 706 -259 +320 +196 +135 Details of trust accounts, etc. Details of general fund balance (end of period) Old-age insurance Unemployment Net expenditures in checking trust fund and railroad trust fund accounts of Government agencies All other Period retirement account In- Workc N e r i e e p - t ts m v I e e n s n - t t - s m B p e e f a i n n y t e t - s - ce R i e p - ts m v I e e n s n - t t - s p O tu e e t x n r h e - d e s r i- s C F t R r o i t u e n r i c c p o a o t o n n i n r c o a - e n - C m C o C t o r r i o p e o d m d o n it r i - y t a- t U i S H n h g n t o o a i r u t t A i e e s t s y d u - - o A th l e l r ce R i e p - ts p tu E e r n x e d - s i- Total m g c o o r e e n l n d - t S io e r i a g g n e - a b i n n a c g l- e Fiscal year ending: June 1933 818 180 185 862 862 June 1934 __ 570 162 3 2,995 2,160 2,582 811 1,771 June 1935 *145 *60 *432 393 209 1,841 700 140 1,001 J J u u n n e e 1 19 9 3 3 6 7 — _ 267 267 (4) 29 1 4 9 29 1 3 9 (4) * *3 2 2 4 9 1 *1 3 1 3 2 1 1 0 2 0 7 4 3 5 4 6 2 2 2 8 5 2 2 s 2 2r, 6 5 8 5 2 3 1 1 4 4 0 1 3 3 1 5 6 6 5 2 2 . , 2 0 2 5 5 7 June 1938... 550 461 85 763 560 191 *9 *184 1 •12 414 327 2,216 142 446 1,628 June 1939. ._ 639 516 120 838 395 442 *658 136 *60 *186 440 324 2,838 142 536 2,160 June 1940... 704 573 129 959 443 514 *234 10 17 166 415 323 1,891 143 585 1,163 1939—July 65 45 10 58 *14 42 16 6 13 131 114 101 2,447 142 544 1,761 Aug 66 51 10 154 129 41 29 *86 9 87 20 15 2,231 142 549 1,539 Sept 50 43 10 13 *19 40 22 5 13 *87 25 15 2,178 142 554 1,481 Oct 53 43 10 54 7 24 15 19 16 *11 28 13 1,913 143 558 1,213 Nov 53 43 10 144 142 29 *297 27 *12 *7 20 14 2,166 143 561 1,462 Dec 58 43 10 29 *3 32 *5 11 16 *6 21 25 2,476 143 565 1,768 1940—Jan 10 10 79 28 58 *20 *6 14 *25 24 17 2,282 143 568 1,571 Feb 10 10 155 103 45 *5 *3 *11 7 20 2 2,350 143 573 t, 634 Mar 135 135 11 30 *18 47 2 *4 17 *29 29 22 2,514 143 577 1,794 Apr 20 *5 12 53 18 45 *3 *4 *34 9 32 10 2,210 143 581 1,486 May 4 12 145 81 58 *6 (4) *17 107 20 17 2,030 143 584 1,303 June 180 175 12 46 •11 54 17 45 *5 •11 62 72 1,891 143 585 1,163 July 56 *5 13 59 13 57 25 10 25 *57 120 103 2,258 143 588 ,527 Aug 145 1 13 143 85 53 (4) *144 *6 *32 17 15 2,454 143 590 L,720 1 Beginning with July 1,1940, net receipts represent total receipts less net social security employment taxes, which under the 1939 amendments to the Social Security Act are appropriated directly to the Federal old-age and survivors insurance trust fund. To make the figures for earlier periods comparable, transfers to this trust fund, formerly shown under expenditures, have been deducted from total receipts, from total expendi tures, and from transfers to trust accounts. 2 Details given in lower section table. 3 For details, see preceding page. 4 Less than $500,000. s Includes $1,087,000,000 of gold held in an inactive account by the Treasury during the period December 1936 to April 1938. * Excess of credits. NOTE.—For explanation of table see page 1052. 1122 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

GOVERNMENTAL CORPORATIONS AND CREDIT AGENCIES, JULY 31, 1940 [Based on compilation by U. S. Treasury Department from reports received from organizations concerned. In millions of dollars] Home mortgage and Farm credit agencies Total Recon- housing agencies Tenstruction nes- Finance see In- Corpo- United Other Val- surration Home Other States Farm Farm Com- ley ance Other and Owners' mort- Hous- mort- Credit modity Au- agen- July June July Public Loan gage ing gage Adm. Credit Other thor- cies 31, 30, 31, Works Corpo- agen- Au- agen- banks Corpo- ity 1940 1940 1939 Admin- ration cies thority cies and cor- ration istration porations Assets Loans and preferred stock: Loans to financial institutions 204 162 63 430 429 435 Preferred stock, etc 466 197 33 75 1 772 783 864 Loans to railroads 522 30 552 524 493 Home and housing mortgage loans 2,005 225 112 2,342 2,323 2,332 Farm mortgage loans 2,540 2,540 2,549 2,647 Other agricultural loans 1 310 182 196 5 693 675 1,084 All other loans M45 0) 3 375 4 365 1,185 1,187 1,007 Total loans and preferred stock 1,638 2,202 420 112 2,540 385 182 570 63 401 8,513 8,470 8,861 Cash 7 104 37 31 98 99 2 25 9 35 15 462 412 385 U. S. Govt. direct obligations 49 4 42 4 86 141 410 4 740 748 731 Obligations of Government credit agencies: Fully guaranteed by U. S 14 11 105 131 131 140 Other s 8 (5) 8 18 35 48 47 Accounts and other receivables 23 8 6 1 211 4 12 0) 6 62 60 394 404 378 Business property 0) 3 0) 128 6 (0 8 327 1 93 567 562 483 Property held for sale __ „ 42 413 97 (l) 479 33 1 1,067 1,067 709 Other assets 2 0) 0) 0) 7 2 5 25 141 184 179 90 Total assets other than interagency 6 1,770 2,734 521 277 3,053 661 684 601 342 736 715 12,09212,02111, 823 Liabilities Bonds, notes, and debentures: Guaranteed by United States... 1,096 2,631 114 1,270 407 9 5,526 5,529 5,291 Other 5 134 5 976 218 g 3 11 1,351 1,343 1,349 Other liabilities (including reserves). 221 74 35 5 96 8 3 193 6 253 71 964 1,105 867 Total liabilities other than interagency 8 1,317 2,705 169 119 2,342 227 410 193 14 265 82 7,842 7,977 7,507 Excess of assets over liabilities, excluding interagency transactions.. 453 30 352 158 711 434 274 408 328 471 633 4,250 4,044 4,316 Privately owned interests _. 53 210 4 139 406 405 390 U. S. Government interests 453 30 298 158 501 431 274 408 328 332 633 3,844 3,639 3,926 i Less than $500,000. 2 Includes $97,000,000 loans of Public Works Administration. 3 Includes $307,000,000 loans of Farm Security Administration. 4 Includes $225,000,000 loans of Rural Electrification Administration. 6 Excludes Federal land bank bonds held by Federal Farm Mortgage Corporation. 6 Includes, however, investments in securities of agencies (other than mentioned in footnote 5) and deposits of agencies with Reconstruction Finance Corporation. NOTE.—For explanation of table, see BULLETIN for October 1938, p. 882. RECONSTRUCTION FINANCE CORPORATION LOANS AND INVESTMENTS [Amounts outstanding. In thousands of dollars] Aug. 31, Feb. 29, Mar. 31, Apr. 30, May 31, June, 30 July 31, Aug. 31, 1939 1940 1940 1940 1940 1940 1940 1940 Loans to financial institutions 178,833 162,852 159, 353 155,651 154,163 150, 468 147,184 145,178 Loans on preferred stock of banks and insurance companies.. 33,181 29,994 29,840 29, 749 29, 685 56, 952 56, 924 56, 769 Preferred stock, capital notes, and debentures 517,125 476, 395 472,345 474,475 471,072 469, 674 465, 909 458,845 Loans to railroads (including receivers) 438, 837 458,841 467,887 471, 747 466,093 475,856 506,623 507, 627 Loans for self-liquidating projects 73,844 66, 501 66, 753 58, 578 61, 273 48,105 38,754 42, 262 Loans to industrial and commercial businesses K 123, 042 131,919 130, 704 130,466 130, 566 130, 732 129, 955 129,427 Loans to drainage, levee, and irrigation districts 83, 462 83, 874 83,966 83, 723 83,740 83, 596 83, 299 83, 223 Other loans 23,812 4,180 4,260 4, 235 4,631 4,677 4,788 4,801 Securities purchased from Public Works Administration 122, 986 117, 603 114,066 112, 743^ 111, 323 111,065 107,066 110,090 Total loans and investments, other than interagency- 1, 595,1211, 532,1601, 529,1741, 521,3651, 512, 5461, 531,124 1, 540, 502 1, 538, 222 Preferred stock of Export-Import bank. 45,000 74,000 74,000 74,000 74,000 74,000 74,000 74,000 Loans to Rural Electrification Administration 146, 498 146,498 146,498 146,498 146,498 146, 498 146,498 146,498 Capital stock of, and loans to R. F. C. Mortgage Co 54,903 58,124 59,198 59,355 59,484 59, 050 58, 628 60, 212 Capital stock of, and loans to Fed. Natl. Mtge. Assn 44, 438 65,806 68, 616 70,385 71,846 73,863 76, 470 78,976 Loans to Tennessee Valley Authority 8,300 8,300 8,300 8,300 8,300 8,300 8,300 8,300 Capital stock of Metals Reserve and Rubber Reserve Cos- 1,000 2,000 Loans to Farm Security Administration.. _ 10,000 10,000 Total loans and investments.. 1,894, 2601,884,888 1,885, 7861,879, 9031,872, 673 1,892,835 1, 915, 397 1, 918, 206 i Include national defense loans to private corporations under the Act of June 25, 1940, amounting to $55,000 on August 31, 1940. NOTE.—For explanation of table and back figures, see BULLETIN for April 1936, p. 220. OCTOBER 1940 1123 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FARM CREDIT ADMINISTRATION LOANS AND DISCOUNTS OUTSTANDING, BY INSTITUTIONS [In thousands of dollars] Federal intermediate Farm mortgage loans credit bank loans to Loans to cooperatives byby- and discounts for— Regional agri- Produc- Regional Emer- End of month lan F d e d b e a ra n l ks C s o B L i m o a a n n n m e d k r is- p a c s p c r o r n c o r o e c u d e r d d i a l d a i u t b t i t t u i c t i a o c r o t n a a n i o n o s k l s r s - n , s - , f c i i e n o n O t t x i a o i s o t v c n t p h n i e e c e t e s p s u r i r , n a t - - g ti a o s t n s i o o c n c r i s e a d - it tu i a r t r g a c a t r o l i i o c r c p u n r o l s e - - d- c d r g r l o o o e p a u n a n c g n s y h d t m F b c i e e n r a d d e t n e e d i k a r r i - a s t te l B in C c a a c B o t e n l i o u a n k v p n d t s e e r k i s f a r n , o - l g r i M A i n r n e t g g a g u v r r r o i f k A c a u l e u v l n c t l - t d - for cooperatives 1 1934—December. 1,915,792 616,825 99,675 55, 672 60,852 87,102 111,238 27,851 54,863 1935—December. 2,071,925 794,726 104,706 47,162 94,096 43,400 172,863 2,731 50,013 44,433 1936—December. 2,064,158 836,779 129,872 41,017 105,212 25,288 165,369 1,641 69,647 53,754 1937—December. 2,035,307 812, 749 165,194 40,464 138,169 15, 592 172,701 1,813 87,633 30,982 1938—December. 1,982,224 752,851 168,392 33,545 148,037 11,081 171,489 920 87,496 23,723 1939—August 1,928,166 708,426 187,968 41, 661 185, 215 178,271 127 61,404 22,422 September 1, 922, 577 703,840 179, 674 37, 645 174,032 9,127 175,667 778 65,160 21,663 October... 1.916,431 699,274 169,731 33,996 162,703 8,351 171,819 1,493 70,422 21,582 November. 1,910, 336 695,101 165,368 33,417 156, 526 8,042 169,460 1,696 73,120 20,589 December. 1,904,655 690,880 165, 236 33,354 154,496 8,005 168,330 1,835 76,252 20,547 1940—January... 1,900,408 687,191 161,753 33,620 153,949 7,904 167,957 1,756 73, 238 20,427 February.. 1,896, 507 683, 694 165,106 34,738 160,003 7,926 170,020 2,002 71,772 20,038 March 1.890,432 677,717 176,007 36, 326 173,840 7,888 176,045 1,754 69,311 19,763 April 1,886,272 673,696 185,373 37,921 186, 276 7,904 179,801 1,603 67,454 18, 537 May 1,882, 516 670,723 190,961 38,377 194,662 7,845 180,938 1,315 63, 564 18,137 June 1,880,408 668, 850 196,408 40,033 200,415 7,768 181,218 897 62,177 18,200 July _. 1,874, 608 665,073 199, 238 42,161 203, 693 7,614 180,824 1,217 65, 111 15,311 August 1,871,487 662, 592 202, 503 42,416 202,796 7,416 179, 984 763 67,473 14,787 i Some of the loans made by the regional agricultural credit corporations (prior to October 1935) and by the banks for cooperatives and most of the loans made by the production credit associations are discounted with the Federal intermediate credit banks. The amounts in this column are thus included in the three columns under those headings, Such loans are not always discounted in the same month in which the original credit is extended. FEDERAL HOME LOAN BANK BOARD POSTAL SAVINGS SYSTEM LOANS OUTSTANDING, BY INSTITUTIONS [In millions of dollars] [Loans in thousands of dollars] Assets Home mortgage loans by- Federal U. S. Government home Depos- securities End of month L p O o H o w a r o n a n m t e C io r e o s n r ' - F N c o e l i u o f a d a m t a e i n s r o b s a n o a e l s - s r s s a o v c i L i n a o g ti s a o n a n s n s i d m l i o t n b i e l a o s o a m n t n a n i s s t b n k u t e 2 o - r End of month a i b n t a o c l- e rs s1 Total i b C p n t a o o a n d r s s k y e i h - s - Total t o r i D g e o b i a c - n l - i t s - G t o t i a g e u o b n a e l a n - - d i r s - - f s C e u e r t a n e r c s v - d .2 h e s 1934—December. 2, 379,491 639 81,300 86,651 1935—June. _ 1,205 1,236 385 777 630 147 74 1935—December. 2,897,162 1,023 348,000 102, 791 1936—June.. 1,232 1,265 203 967 800 167 95 1936—December. 2, 765,098 1,212 586,700 145,394 1937—June.. 1,268 1,307 136 1,100 933 167 71 1937—December. 2, 397, 647 1,328 853, 500 200,092 1938—June.. 1,252 1,290 115 1,103 936 167 73 1938—December. 2,168,920 1,368 1,034,162 198,840 1939—June.. 1,262 1,304 1,157 1,011 146 78 1939—April 2,105,824 1,381 1,089,879 157,176 1939—August 1,271 1,314 1,174 1,028 146 84 May 2,091, 324 1,383 1,117, 228 157,911 September 1,267 1,307 1,182 1,036 146 70 June 2,080,512 1,386 1,136,289 168,962 October 1,270 1,312 1,182 1,036 146 75 July 2,067,844 1,385 1,157, 536 161,537 November 1,274 1,317 1,182 1,036 146 80 August 2,059, 792 1,392 1,186, 784 159,470 December 1,279 1,319 1,192 1,046 146 74 September. 2,054,865 1,394 1,206,887 163, 687 1940—January 1,290 1,331 1,197 1,051 146 84 October 2,049,421 1,394 1,231,685 168,654 February 1,297 1,340 1,194 1,048 146 97 November. 2,043,288 1,401 1,252, 559 168,822 March 1,301 1,343 1,200 1,054 146 97 December. 2,038,186 1,410 1, 271,161 181, 313 April 1,303 1,345 1,214 1,068 146 87 1940—January... 2,031,341 1,403 1,280,200 156,788 May 1,299 1,342 1,224 1,078 146 74 February- 2,026, 614 1,407 1, 296,464 144,515 June. l 293 March 2,021,951 1,413 1,317, 975 137,642 July 1. 297 April 2,020, 572 1,420 1,348,072 133,811 August l, 297 May 2,017, 395 1,421 1,376, 700 137,509 June 2,012, 760 1,430 1,405,100 157,397 July. 2,004,737 1,431 1,432,100 162,222 p Preliminary. August 1, 996,443 1,431 1,461,867 168,402 1 Outstanding principal, represented by certificates of deposit. Does not include accrued interest nor outstanding savings stamps. 2 Includes working cash with postmasters, 5-per cent reserve fund and i Federal Home Loan Bank Board estimates for all Federal savings miscellaneous working funds with the Treasurer of the United States, and loan associations. accrued interest on bond investments, and accounts due from late post- * Excludes loans to other than member institutions which are negli- masters. gible in amount. Back figures.—See BULLETIN for August 1935, p. 502. 1124 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

BUSINESS INDEXES [The terms "adjusted" and "unadjusted" refer to adjustment of monthly figures for seasonal variation! Construction Y m ea o r n a th nd 1 ( I 9 m v n 2 p a c 9 e a l o = n u y m 1 e - t 0 s ) e C To I ( t n p a d h l u y s s 1 t i 9 c r 3 i a a 5 l l D - v 3 f u p a 9 o M r r c = l o - u t 1 a u d m 0 n r u N 0 d e e u c ) r u o - t s r i n 2 o - - n * M era in ls - T aw ot a 1 a r 9 c l d 2 o e 3 n d d t - t i e 2 r a n 5 a ( l v = - c a 1 ts l 0 u o 0 A e th ) l e l 3 i 1 t N 9 a c u 3 g u o 5 r E r l a - n i - 3 m l - - S pl 1 o 9 y F 2 m 3 a - c e 2 t n 5 o = t r 4 1 y 00 1 r = 9 p t F o o 2 1 a l a 3 l r 0 y c s y - - 0 - 2 4 5 F 1 i = l 9 r n o c e 2 1 g a a i 3 0 s g d r - 0 2 * - h 5 t' D ( 1 v m = s 9 s e a a t 2 1 p e o l l 3 0 e u a n r - 0 s e r 2 e t t 5 ) - : p m W = c r 1 s o i o 1 h 9 a c d m 0 2 o l e e i 0 6 s l - t e y - 1 = 9 i C l n 3 1 i o o g v 5 0 f - s - 0 4 3 t 9 able able =100 Ad- Ad- Unad- Ad- Ad- Ad- Ad- Ad- Ad- Unad- Ad- Unad- Unad Ad- Ad- Unad- Unadjusted ustedjusted justed justedjustedjusted justed justedjusted justed justed justed justed justed justed justed 1919.. 72 63 44 106.7 98.0 84 138.6 1920.. 75 60 63 30 107.1 117.2 91 154.4 1921.. 58 57 56 44 82.0 75.6 78 97.6 1922.. 73 67 71 79 68 90.7 81.2 85 96.7 1923.. 88 72 84 81 103.8 102.9 100 100.6 1924.. 82 69 94 95 94 96.4 96.0 98 99 98.1 1925.. 91 76 122 124 120 99.8 101.1 103 103 103.5 96 79 129 121 135 101.7 104.2 107 106 100.0 1927.. 95 83 129 117 139 99.5 102.4 104 107 95.4 1928.. 99 85 135 126 142 99.7 103.5 104 108 96.7 1929.. 100.0 110 93 117 87 142 107.8 106.0 110.4 107 111 95.3 122.5 1930.. 90. 91 84 92 50 125 101.1 92.4 89.4 92 102 86.4 119.4 1931- 77.3 75 79 63 37 84 92.4 78.1 67.8 74 92 73.0 108.7 1932.. 60.1 58 70 28 13 40 83.0 66.3 46.7 55 69 64.8 97.6 1933.. 57.1 69 79 25 11 37 83.6 73.4 50.1 58 67 65.9 92.4 1934.. 65.8 75 81 32 12 48 90.7 85.7 64.5 62 75 74.9 95.7 1935.. 71.7 87 90 37 21 50 94.2 91.3 74.1 64 79 80.0 98.1 1936.. 82.7 103 100 55 37 70 100.3 99.0 85.8 75 88 80.8 99.1 1937- 87.4 113 106 59 41 74 105.3 108.6 102.5 78 92 86.3 102.7 1938.. 80.7 88 95 64 45 98.6 89.7 77.9 62 85 78.6 100.8 1939.. 85.4 108 108 72 60 101.6 96.8 90.8 70 90 77.1 99.4 1937 July 89.2 118 106.9 112.3 110.9 105.2 87.9 August 89.0 120 107.3 111. 112.3 108.7 87.5 September 87.3 115 107.8 110.3 112.3 104.9 87.4 104.3 October 86.6 110 107.1 107.8 110.3 104.9 85.4 November 84.9 97 104.6 103.7 104.1 93.3 83.3 December 83.7 102.8 97.9 97.4 84.6 81.7 10376 1938 January 82.3 82 98.3 93.0 90.6 75.3 90 80.9 M Fe a b r r c u h ary 8 8 1 1 . . 2 5 8 8 2 4 9 9 8 8 . . 0 0 9 90 1 . . 4 9 9 9 0 1 . . 6 1 7 77 7 . . 6 5 7 7 9 9 . . 8 7 i66.~9 April 80.1 82 98.3 88. 88.5 74.9 78.7 J M un ay e 7 7 8 9 . . 7 1 8 8 1 1 90 9 9 7 7 . . 4 2 8 8 6 5 . . 4 2 8 84 6 . . 3 1 7 7 3 1 . . 2 1 7 7 8 8 . . 3 1 16679 July 78.7 85 95 97.2 86.0 84.7 71.1 83 78.8 A Se u p g t u em st ber : 8 7 0 9 . . 4 8 9 9 0 5 1 9 0 9 0 9 9 8 9. . 9 3 8 8 7 9 . . 9 4 8 9 8 2 . . 8 0 7 81 7 . . 6 3 7 7 8 8 . . 1 3 166." 7 October 81.7 99 100 100.1 90.2 92.4 84.2 84 77.6 N D o ec v e e m m b b e e r r 8 8 3 2 . . 1 1 1 10 0 0 2 97 1 1 0 0 4 3 1 9 0 9 0 . . 9 8 9 94 2 . . 4 8 9 9 3 4. . 0 3 8 8 4 7 . . 4 1 7 7 7 7. . 0 5 16672 1939 January 83.4 104 103 98.0 94.6 92.2 83.7 76.9 February _ 83.7 97 104 102 98.4 94.3 93.6 86.0 87 76.9 March 84.6 100 104 103 99.2 94.0 94.3 87.6 76.7 April 83.1 103 92 99.3 93.8 94.1 85.5 76.2 May 83.8 104 96 100.1 93.3 93.0 85.0 85 76.2 June 84.1 102 106 105 101.4 94.3 93.4 86.5 75.6 "~98~6 July 83.6 102 106 107 101.4 95.3 93.5 84.4 75.4 August 85.2 103 108 91 102.3 95.9 96.3 89.7 75.0 September 86.1 116 111 114 104.0 97.5 100.2 93.8 79.1 "I66.~6 October 88.0 126 115 119 105.1 101.2 103.6 101.6 79.4 November 88.5 126 117 120 104.6 103.4 103.8 101.6 79.2 December 90.0 124 118 114 105.2 104.5 104.1 103.7 79.2 1940 January- 90.3 117 135 93 101.9 103.9 101.4 98.3 92 79.4 February. 89.7 113 124 68 101.7 102.1 101.4 97.8 78.7 March 88.4 112 118 66 102.4 100.4 100.8 98.2 78.4 99.9 April 88.2 111 113 66 102.4 1.2 99.6 96.3 78.6 May 88.6 116 119 65 103.4 >.2 99.0 96.3 78.4 June 88.7 121 131 77 104.2 100.2 99.4 97.9 77.5 "16675 July 89.3 118 132 91 104.4 101.4 99.5 96.5 77.7 August *>90. 3 P121 P134 P101 105. 6 103. 5 103.5 103. 7 77.4 p Preliminary. * Average per working day. 1 Department of Commerce series on value of payments to individuals. 2 For indexes of groups and industries, see pp. 1126-1129; for description, see pp. 753-771 of BULLETIN for August 1940. 3 Based on F. W. Dodge Corporation data; for description, see p. 358 of BULLETIN for July 1931; by groups, see page 1134. 4 The unadjusted indexes of employment and payrolls, wholesale commodity prices, and cost of living are compiled by or based on data of the Bureau of Labor Statistics. For description of seasonally adjusted index of factory employment compiled by the Federal Reserve Board of Governors, see BULLETIN for October 1938, pp. 835-837, and for October 1939, p. 878. For indexes by groups or industries see pp. 1130-1133 for employment and payrolls and p. 1136 for prices. Back figures in BULLETIN.—For industrial production, August 1940, pp. 825-882; for factory employment and payrolls, October 1938, pp. 838-866, and for October 1939, pp. 879-887; for freight-car loadings, June 1937, pp. 524-529; for department store sales, October 1938, p. 918. OCTOBER 1940 1125 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDUSTRIAL PRODUCTION, BY INDUSTRIES (Adjusted for Seasonal Variation) [Index numbers of the Board of Governors. 1935-39 average= 100] 1939 1940 Industry July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June July Aug. Industrial Production—Total 104 104 113 121 124 126 122 116 112 Ill 115 121 121 Manufactures—Total 104 107 113 121 124 128 122 116 112 110 114 121 121 * P123 Durable 101 105 114 129 133 140 135 124 118 113 119 131 132 P134 Nondurable 106 108 111 115 117 118 113 110 106 107 110 114 112 P113 Iron and Steel. . . 103 111 128 161 161 167 147 118 106 99 118 154 156 158 Pig iron... 102 114 129 154 163 169 161 136 118 117 127 148 157 162 Steel ingots. 104 111 128 161 161 167 146 117 105 97 118 154 156 157 Machinery... 101 104 108 115 123 125 127 123 123 123 124 128 133 Transportation Equipment 86 92 99 105 102 128 137 137 131 115 116 120 109 P104 Aircraft.. 170 177 181 194 216 239 256 251 263 267 281 315 339 P382 Automobiles 1 77 84 92 96 91 121 129 129 120 103 101 106 C87 76 Railroad cars 69 74 83 105 122 136 156 158 149 125 121 111 119 P123 Locomotives . 98 102 100 97 98 95 102 101 101 103 102 102 113 P121 Shipbuilding 130 133 136 138 142 144 149 150 156 156 164 170 189 P211 Nonferrous Metals and Products 102 112 128 144 153 159 154 142 132 124 126 129 136 144 Nonferrous metal smelting 2 98 105 117 124 130 135 135 129 130 127 127 125 133 128 Copper smelting 97 144 131 137 131 130 131 ^140 135 Copper deliveries 97 162 145 125 111 113 115 119 134 Lead shipments. 103 105 117 130 144 136 119 102 100 104 no 119 127 128 T Zi i n n c d s e h li i v p e m ri e e n s ts 9 9 9 6 1 9 0 8 7 1 9 2 8 8 1 1 4 0 6 1 1 1 5 1 4 8 1 1 5 4 9 4 1 1 3 8 1 0 1 1 2 6 6 8 1 14 2 8 2 1 1 1 3 5 2 111357 1 1 2 4 2 1 146 138 Lumber and Products 104 105 108 113 121 121 115 114 111 110 112 111 107 P114 Lumber 103 104 107 112 121 122 115 114 110 109 110 110 103 113 Furniture 106 107 109 114 121 • 118 117 113 112 111 115 113 115 P115 Stone, Clay and Glass Products 114 113 116 123 120 128 123 113 120 115 113 111 114 Cement 113 112 114 120 121 131 125 106 117 115 115 113 110 115 Common and face brick 130 129 126 119 125 142 119 96 106 108 109 Common brick 132 131 125 117 121 141 111 103 106 107 111 Face brick 124 126 132 126 138 143 136 81 105 107 105 Glass containers . 117 108 110 121 112 115 116 118 124 116 112 111 117 114 Polished plate glass 76 95 110 124 112 124 122 112 105 96 91 80 100 114 Textiles and Products 113 lit 114 119 128 126 118 109 99 100 103 106 111 114 Textile fabrics 108 109 113 118 124 121 113 105 97 97 100 102 103 111 Cotton consumption 111 114 117 119 124 128 120 115 108 107 109 112 116 124 Rayon deliveries . 134 129 127 130 146 152 151 144 139 138 142 144 138 130 Silk deliveries 79 82 86 91 89 78 69 64 64 61 58 56 61 Wool textiles 107 106 113 125 132 115 106 93 77 79 87 89 100 106 Carpet wool consumption. 90 121 121 124 132 115 111 108 87 97 95 79 69 95 Apparel wool consumption 110 108 120 131 125 104 107 92 80 68 82 88 113 108 Woolen yarn 102 98 105 113 115 105 99 89 78 78 86 92 102 104 Worsted yarn 108 105 124 150 151 112 98 93 75 76 90 93 112 118 Woolen and worsted cloth. 117 103 107 118 135 127 111 89 71 76 83 89 105 104 Leather and Products. 107 103 103 105 108 105 101 98 93 85 87 96 93 Leather tanning 100 99 103 104 103 101 102 96 92 86 88 90 85 Cattle hide leathers 102 105 108 104 105 107 104 100 94 86 87 90 88 Calf and kip leathers 93 92 105 108 101 90 97 86 84 80 91 88 75 Goat and kid leathers 99 88 90 103 98 92 99 92 92 91 89 91 84 Shoes 111 107 104 105 112 108 101 99 94 85 85 100 99 Manufactured Food Products 105 111 111 109 110 112 111 113 112 111 112 115 110 Wheat flour 103 106 118 101 97 102 100 100 100 100 105 98 100 9S Cane sugar meltings 104 98 104 107 92 96 95 95 86 89 97 112 101 Manufactured dairy products 105 105 110 108 110 115 109 114 112 112 110 111 112 Ice cream 107 104 120 114 114 120 102 115 110 113 Butter 103 105 98 97 103 105 110 109 107 108 102 105 105 104 Cheese 102 105 102 103 102 103 102 104 115 116 117 110 114 114 Canned and dried milk 103 107 110 111 118 123 128 126 123 118 112 117 121 132 Meat packing 114 113 118 113 116 126 124 129 128 117 117 126 116 119 Pork and lard 126 130 135 127 131 149 144 154 156 131 135 152 132 141 Beef 102 97 103 98 101 104 104 106 102 106 101 101 101 99 Veal.. . 96 88 93 96 98 87 88 86 87 86 89 91 97 91 Lamb and mutton 100 92 101 99 107 109 108 99 97 98 93 99 98 96 Other manufactured foods 104 112 110 110 111 111 111 112 112 112 112 115 110 P116 Alcoholic Beverages 97 96 96 106 98 95 98 96 98 103 100 113 108 91 Malt liquor 103 98 98 112 102 104 103 96 99 102 99 99 103 91 Whiskey 55 51 57 57 57 58 59 65 78 84 84 72 44 Other distilled spirits HI 117 120 120 87 88 112 114 132 132 113 131 148 208 Rectified spirits 107 116 116 118 123 92 108 126 108 123 114 201 154 87 Tobacco Products _ 100 110 107 111 110 109 103 106 103 111 110 115 103 106 Cigars 100 105 103 103 100 104 107 103 100 102 104 98 101 105 Cigarettes 102 113 110 117 118 115 106 109 107 119 117 127 106 110 Manufactured tobacco and snuff.. 94 109 103 102 103 100 93 97 95 99 100 99 99 96 r Revised. v Preliminary. c Corrected. 1 Revised seasonal adjustment factors, 1940: July, 80; August, 30. Factors for subsequent months will be revised later. 2 Includes also lead and zinc production shown under "Minerals." 1126 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Industrial Production, by Industries (Adjusted for Seasonal Variation)—Continued [Index numbers of the Board of Governors. 1935-39 average = 100] 1939 1940 Industry July Aug. Sept Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June July Aug. Paper and Products 108 112 121 131 134 135 123 114 llo 116 127 ••132 129 Paper and pulp 107 110 119 128 132 134 123 114 110 117 128 132 130 Pulp 105 109 12J 136 137 147 138 133 135 140 149 159 153 Ground wood pulp 103 104 110 118 108 116 114 110 110 118 118 118 116 Soda pulp 91 97 112 129 131 145 129 117 116 118 135 148 142 Sulphate pulp 130 133 141 156 157 176 160 153 151 164 175 186 178 Sulphite pulp 94 99 113 131 133 138 134 130 136 136 145 157 151 Paper 107 110 119 127 131 132 121 111 106 113 125 128 126 Paperboard.- 112 114 120 129 134 140 127 112 109 114 131 128 130 121 Fine paper 94 102 120 123 129 122 111 100 95 99 110 118 121 Newsprint production 104 104 106 103 101 105 106 112 112 113 113 115 111 Printing paper 102 111 118 133 132 132 119 116 109 115 125 135 125 Tissue and absorbent paper 121 116 123 131 138 140 119 119 105 119 123 '137 130 Wrapping paper 104 107 117 123 127 128 121 108 105 114 127 126 125 Paperboard containers 115 118 129 142 144 138 120 112 111 115 125 128 128 Printing and Publishing l 100 105 111 118 117 119 109 108 106 108 115 120 113 Newsprint consumption.. 97 104 103 101 107 100 103 101 106 106 102 104 Petroleum and Coal Products.. 106 110 112 120 120 119 117 116 118 115 114 115 112 Petroleum refining 107 111 112 118 117 116 114 115 117 114 113 112 108 Gasoline 108 110 112 117 118 116 112 112 115 112 111 110 106 Fuel oil 107 108 110 116 112 111 119 119 121 117 113 113 111 Lubricating oil 102 114 109 132 125 129 126 124 124 120 118 122 113 Kerosene. 108 114 116 117 107 109 97 120 123 120 126 116 116 Coke.. 98 104 116 133 140 139 137 123 118 119 123 132 139 139 Byproduct coke 100 106 117 131 137 137 137 124 119 120 123 131 137 136 Beehive coke. ._ 44 40 69 192 244 217 145 84 101 142 206 248 Chemicals.. 104 106 111 111 109 111 116 Rubber Products... _ 107 112 122 128 126 123 119 119 116 115 117 115 106 110 Rubber consumption.. 107 112 121 129 127 125 120 120 116 115 116 114 106 110 Tires and tubes _ 112 118 125 121 114 109 110 114 117 115 121 126 '105 104 Pneumatic tires... 114 119 126 122 115 111 112 116 118 115 122 128 106 104 Inner tubes 102 108 116 118 112 101 104 108 109 112 113 95 102 Minerals—Total.. 107 114 114 118 114 117 119 118 118 120 Fuels 108 113 117 118 113 117 112 114 116 115 116 117 2*112 Bituminous coal.. 103 108 114 123 119 106 119 103 109 120 122 116 121 P122 Anthracite— 90 115 120 112 97 111 78 84 83 82 113 129 P113 Crude petroleum.. 112 79 112 116 120 118 116 118 120 118 116 116 114 P109 Metals _. 102 105 121 128 131 124 127 130 134 135 135 134 139 P139 Iron ore shipments.. 102 108 119 133 155 122 132 143 153 151 153 155 160 164 Copp 103 147 140 141 144 143 143 150 144 102 108 107 111 109 112 114 116 117 118 124 117 120 117 Zinc... 98 100 104 116 127 130 130 133 127 127 123 120 128 123 Gold... 111 106 125 130 113 119 121 119 124 124 124 122 125 Silver.. 71 84 111 109 116 101 120 113 127 125 114 122 p Preliminary. »• Revised. i Includes also printing paper production shown under "Paper." NOTE.—For description and back figures see BULLETIN for August 1940, pages 753 to 771 and 825 to 882. OCTOBER 1940 1127 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INDUSTRIAL PRODUCTION, BY INDUSTRIES (Without Seasonal Adjustment) [Index numbers of the Board of Governors. 1935-39 average = 100] 1939 1940 Industry July Aug. Sept. Oct. Nov. Dec Jan. Feb. Mar. Apr. May June July Aug. Industrial Production—Total 102 103 116 126 126 124 117 112 111 116 118 P121 Manufactures—Total.. 102 105 116 125 126 126 117 114 112 112 116 122 117 P121 Durable 98 99 111 131 136 139 128 121 121 119 125 134 127 P127 Nondurable 104 110 119 120 118 115 109 108 105 105 109 112 110 P115 Iron and Steel... 108 125 159 161 159 144 121 113 106 123 151 147 153 Pig iron 100 113 126 154 163 160 153 134 124 123 133 149 154 161 Steel ingots.. 97 107 125 159 161 159 143 120 112 104 122 151 147 152 Machinery 102 106 117 123 127 123 123 126 126 126 129 129 P136 Transportation Equipment.. 79 47 74 103 118 152 136 138 142 139 130 129 94 P60 Aircraft... 170 177 175 194 218 239 251 251 263 267 286 321 339 P382 Automobiles. 29 62 94 111 150 130 130 134 130 118 114 <70 23 Railroad cars 75 75 99 112 132 133 151 158 141 137 124 117 P125 Locomotives- 101 103 98 92 95 102 102 103 99 98 102 106 116 P122 Shipbuilding 127 126 132 140 138 146 144 145 162 162 172 176 185 P200 Nonferrous Metals and Products.. 97 108 129 147 157 156 151 140 135 129 128 129 129 139 Nonferrous metal smelting i. 90 119 127 135 136 135 129 132 133 127 124 122 122 Copper smelting 87 143 130 137 139 132 131 rl26 127 Copper deliveries 96 153 139 129 116 116 116 118 133 Lead shipments 96 100 119 136 154 142 121 101 100 106 109 113 118 122 Zinc shipments 92 99 126 148 162 149 137 128 125 116 115 117 '123 127 Tin deliveries 94 96 97 102 112 148 169 163 151 141 146 148 143 Lumber and Products.. 107 114 117 121 120 111 101 107 109 114 116 111 P123 Lumber 111 116 119 119 116 105 96 104 109 117 119 112 125 Furniture 110 115 125 125 123 109 113 113 108 108 110 107 P118 Stone, Clay and Glass Products.. 128 127 130 137 126 115 90 83 101 114 129 128 126 P131 Cement 140 137 136 139 126 105 69 60 115 140 143 136 141 Common and face brick 161 150 157 145 137 119 70 50 103 131 Common brick 167 153 162 148 133 115 60 49 102 133 Face brick.. 147 144 145 138 148 129 96 53 84 107 126 Glass containers 121 117 112 124 114 107 104 109 117 116 119 117 124 Polished plate glass 50 78 110 142 127 149 129 106 111 96 91 79 Textiles and Products 106 109 116 123 131 .126 120 115 101 97 99 101 104 112 Textile fabrics. 101 106 115 121 128 121 115 112 100 95 97 97 99 108 Cotton consumption _. 100 105 117 121 128 125 124 123 114 110 109 107 104 114 Rayon deliveries.. _ 132 138 146 145 152 150 148 141 132 127 127 131 134 140 Silk deliveries 70 75 88 99 101 84 72 65 66 60 55 51 '51 57 Wool textiles 104 109 110 122 130 118 107 102 77 73 85 98 109 Carpet wool consumption. 89 128 124 122 129 107 105 118 91 91 67 101 Apparel wool consumption 104 112 120 126 126 107 105 99 63 82 108 113 Woolen yarn 102 102 104 111 113 105 100 97 76 73 86 102 108 Worsted yarn 103 107 119 150 151 123 101 97 72 72 90 107 120 Woolen and worsted cloth. 114 105 101 114 134 134 118 102 71 102 107 Leather and Products 103 111 106 99 95 106 99 85 91 Leather tanning 97 102 104 104 102 102 104 91 86 82 Cattle hide leathers.... 95 100 107 105 109 109 105 111 95 85 Calf and kip leathers .. 102 96 103 103 96 91 95 91 79 86 Goat and kid leathers.. 98 87 91 102 95 94 99 96 91 87 83 Shoes 108 121 116 107 97 91 97 107 104 85 P112 Manufafctured Food Products 114 127 135 117 109 107 100 100 101 108 116 120 P132 Whheat flour 102 107 136 110 100 98 101 97 94 95 92 99 100 Cane sugar meltings 120 103 124 104 76 77 79 93 95 98 95 116 116 P94 Manufactured dairy products 151 140 113 85 75 73 71 95 112 148 168 161 P151 Ice cream 179 168 129 82 68 62 51 85 108 Butter 126 116 97 85 81 83 88 94 95 107 132 147 128 114 Cheese 131 119 105 97 78 72 73 82 94 113 154 169 147 128 Canned and dried milk 126 111 101 89 82 85 97 107 120 133 161 173 148 136 107 97 110 113 131 148 146 124 116 111 117 123 109 102 Pork and lard 114 108 120 157 193 187 154 140 124 135 148 119 106 Beef. 103 115 107 106 104 104 95 93 99 101 99 102 100 Veal 95 88 102 106 100 82 85 76 82 85 93 92 96 92 Lamb and mutton 95 92 113 105 104 103 113 99 94 95 95 94 93 95 Other manufactured foods 111 132 142 123 112 107 97 102 110 118 P137 Alcoholic Beverages 104 109 103 80 84 94 105 107 120 112 Malt liquor 127 114 92 83 81 82 82 95 111 117 126 127 106 Whiskey 30 32 41 54 71 66 77 77 81 86 84 67 40 24 Other distilled spirits.. 52 56 164 318 182 110 73 69 86 79 68 77 70 100 Rectified spirits 90 91 123 153 194 123 79 109 103 110 100 161 130 Tobacco Products _. 108 115 117 115 112 94 97 105 112 124 112 110 Cigars.. _. 104 109 118 125 119 80 90 92 97 102 104 105 108 Cigarettes 114 119 118 115 113 102 107 103 99 111 119 140 119 116 Manufactured tobacco and snuff. 110 111 104 102 90 97 101 101 101 97 ' Revised. p Preliminary. c Corrected. Includes also lead and zinc production shown under "Minerals." 1128 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Industrial Production, by Industries (Without Seasonal Adjustment)—Continued [Index numbers of the Board of Governors. 1935-39 average = 100] 1939 1940 Industry July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June July Aug. Paper and Paper Products 104 111 125 136 133 128 120 116 114 119 127 130 123 Paper and pulp 101 109 121 132 131 128 122 118 114 120 128 131 123 Pulp ._ 101 107 119 137 137 143 139 137 138 144 150 157 146 Groundwood pulp 92 88 96 110 110 121 118 114 118 132 131 120 104 Soda pulp 85 97 113 129 131 140 129 121 119 122 135 147 133 Sulphate pulp.. 127 133 141 159 157 167 161 158 154 164 175 184 174 Sulphite pulp 89 99 113 134 135 134 134 134 139 138 145 154 144 Paper _ 101 109 121 131 130 126 119 115 110 116 124 127 120 Paperboard 106 115 128 137 134 125 122 115 113 116 128 128 123 123 Fine paper 86 96 114 123 125 120 112 106 102 108 114 116 110 "116 Newsprint production 102 101 106 103 104 106 106 111 112 113 114 116 108 Printing paper 96 107 117 135 131 131 119 119 114 119 127 132 117 Tissue and absorbentpaper 115 116 128 137 136 135 116 124 106 121 122 rl35 124 Wrapping paper.. _ 101 106 118 126 127 125 121 112 108 115 124 123 122 Paperboard containers 113 119 142 154 141 126 114 110 113 115 123 127 125 Printing and Publishing i 90 111 122 119 120 106 109 111 119 119 103 P103 Newsprint consumption _ 85 88 105 110 106 109 99 107 108 110 107 91 Petroleum and Coal Products 107 111 114 122 121 118 116 115 114 115 115 116 113 Petroleum refining 108 112 114 121 118 115 112 113 113 114 113 113 109 Gasoline 111 114 116 120 119 114 108 109 109 111 111 112 109 Fuel oil. .. 105 106 111 117 113 113 122 120 119 115 113 112 109 Lubricating oil 101 113 109 132 125 128 122 122 123 125 123 122 111 Kerosene 102 110 114 117 111 111 102 121 125 123 126 113 110 Coke 104 116 133 141 140 138 125 120 118 122 131 135 138 Byproduct coke 106 117 131 137 137 137 125 120 120 123 131 134 136 Beehive coke 36 32 57 198 269 253 170 120 100 76 76 116 171 198 Chemicals 97 97 108 116 113 114 111 111 113 114 113 110 110 P112 Rubber Products 107 112 124 128 129 118 122 117 116 114 117 115 106 P110 Rubber consumption 107 112 124 129 131 119 123 117 116 114 116 114 106 110 Tires and tubes 112 118 125 121 114 109 110 114 117 115 121 126 »-105 104 Pneumatic tires 114 119 126 122 115 111 112 116 118 115 122 128 ••106 104 Inner tubes 102 108 116 118 112 101 104 108 109 112 113 95 102 Minerals—Total 106 93 121 129 123 111 115 112 110 111 118 118 121 P120 Fuels 103 87 114 121 120 114 120 116 114 113 113 111 111 P110 Bituminous coal 90 100 118 137 135 117 132 121 104 101 103 100 107 P112 Anthracite 70 85 115 118 99 93 128 86 86 89 90 104 101 P83 Crude petroleum. 112 81 112 115 116 116 114 117 121 121 119 116 114 P112 Metals 125 132 160 177 141 93 87 95 149 161 179 P179 Iron ore shipments 191 204 239 270 165 14 213 288 315 308 91 144 142 144 150 141 140 133 135 &";;::::::::::::::::::::; 95 106 111 109 116 118 114 116 115 119 122 116 112 114 Zinc... 92 95 101 116 128 134 133 135 134 131 123 118 120 117 Gold 119 114 141 163 130 119 114 109 103 109 118 134 Silver 87 109 100 108 117 100 123 118 130 120 113 r Revised. p Preliminary. i Includes also printing paper production shown under "Paper." NOTE.—For description and back figures see BULLETIN for August 1940, pages 753 to 771 and 825 to 882 OCTOBER 1940 1129 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FACTORY EMPLOYMENT, BY INDUSTRIES (Adjusted for Seasonal Variation) [Index numbers of the Board of Governors; adjusted to Census of Manufactures through 1937. 1923-25 average=100] 1939 1940 Industry and group July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June July Aug. Total 95.3 95.9 97.5 101.2 103.4 104.5 103.9 102.1 100.4 99.2 99.2 100.2 101.4 103.5 Durable goods 84.7 85.3 88.9 94.6 97.3 100.0 99.7 97.4 95.9 95.0 95.2 96.2 97.6 101.4 Nondurable goods ... 105.3 105.9 105.7 107.6 109.2 108.9 107.9 106.6 104.8 103.3 103.1 104.1 105.2 105.6 Iron Steel Products 90.6 92.5 96.4 105.9 110.8 112.1 110.4 107.0 102.7 100.8 101.2 103.7 107.3 110.9 Blast furnaces, steel works 96 97 101 115 122 124 122 117 110 107 109 115 120 123 Bolts, nuts, washers, rivets _ _ 94 98 102 113 118 120 117 113 112 108 105 104 110 117 Cast-iron pipe 72 73 74 77 79 79 75 78 76 75 76 75 76 78 Cutlery, edge tools 91 94 97 102 107 109 107 103 101 102 101 102 104 104 Forgings . 56 56 59 66 70 72 72 71 67 67 66 66 70 73 Hardware 70 78 95 99 106 106 104 101 98 97 95 82 84 98 Plumbers' supplies 77 78 80 81 83 85 83 81 81 82 82 83 84 86 Stamped, enameled ware 147 157 159 162 166 166 160 161 158 155 153 153 156 169 Steam, hot-water heating 78 79 80 84 86 87 86 85 85 85 84 85 87 91 Stoves 89 88 86 90 91 93 93 91 91 89 88 91 95 95 Structural, ornamental . _ 67 69 71 75 76 76 75 75 72 71 71 73 75 77 Tin cans, tinware 95 98 97 103 103 100 101 100 99 98 97 100 100 98 Tools. _. . 81 85 87 91 94 96 96 96 93 93 92 92 95 97 Wirework 128 121 149 164 171 176 172 162 161 158 156 151 139 150 Machinery . .. 96.1 97.3 99.8 105.7 110.6 112.9 113.4 113.6 113.3 113.4 113.4 114.9 116.6 120.1 Agricultural implements 115 121 123 125 128 131 133 137 136 133 136 136 133 139 Cash registers, etc. 127 125 127 126 127 129 127 128 128 128 128 130 130 129 Electrical machinery 87 88 92 97 100 103 103 102 102 102 101 103 104 108 Engines, turbines, etc. 95 97 99 108 116 124 133 134 132 134 142 152 165 175 Foundry, machine-shop products- 83 85 86 91 95 97 98 98 97 97 96 97 98 101 Machine tools 149 146 155 170 183 191 197 204 209 215 220 228 238 248 Radios, phonographs . 131 126 129 145 160 153 144 144 145 153 155 144 145 146 Textile machinery... 77 78 78 81 85 86 86 85 85 84 82 79 77 76 Typewriters . _ - 122 119 122 123 125 125 123 119 115 114 113 112 116 119 Transportation Eauivment 90 0 88.3 99.5 105.6 101.3 112.6 113.1 110.8 111.1 109.7 109.9 r109. 9 108.7 119.8 Aircraft . ""1,385 1,414 1,512 1,605 1,767 1,905 2,050 2,062 2,075 2,124 2,260 2,445 2,677 2,872 Automobiles . 90 88 102 108 100 112 111 107 107 106 105 102 97 110 Cars, electric-, steam-railroad 32 31 34 42 48 53 57 61 60 54 52 49 51 49 LShoicpobmuoiltdivinegs 1 2 2 8 8 1 2 2 9 5 1 2 2 8 8 1 2 3 5 2 1 2 3 6 3 1 2 3 8 9 1 3 4 0 0 1 3 4 0 6 1 2 4 8 8 1 2 4 7 8 1 2 5 8 4 1 2 6 9 4 1 3 7 1 5 1 3 85 3 Nonferrous Metals, Products 94.6 96.2 99.2 107.0 110.1 111.3 111.7 107.5 106.6 105.9 106.0 '108. 2 110.7 115.6 Aluminum 153 157 152 166 172 170 173 170 168 170 173 177 185 191 Brass, bronze, copper -_ 106 109 115 130 137 138 137 128 127 125 124 128 132 140 Clocks, watches 84 85 85 87 88 89 92 91 91 90 92 r94 95 98 Jewelry.. _ _ ._ 94 95 91 92 95 96 95 93 95 96 96 99 100 100 Lighting equipment 75 77 88 95 89 95 95 88 84 85 84 86 81 93 Silverware, plated ware . 70 70 71 70 72 74 74 71 70 70 70 68 71 71 Smelting, refining . __ 76 75 77 83 85 86 87 87 87 86 86 87 89 91 Lumber, Products . . 66.0 66.4 67.4 69 4 72.2 72.4 72.0 70.0 68.1 67.2 67.9 67.4 67.5 68.4 Furniture .. „ 86 86 87 89 93 93 94 91 90 90 90 90 89 90 Lumber, mill work 59 60 61 63 64 64 65 63 62 61 60 61 62 63 60 60 61 63 66 66 65 63 61 60 61 60 60 61 Stone, Clay, Glass Products 78.4 78.1 79.0 81.9 85.0 85.4 85.8 80.8 80.0 79.8 78.9 79.8 81.5 81.7 Brick, tile, terra cotta 58 57 59 61 64 65 66 61 59 59 58 58 60 60 Cement— ._ 67 67 66 68 70 71 68 66 65 68 66 67 66 67 Glass . _ 98 99 100 106 109 109 111 103 105 104 103 103 106 108 Marble, granite, slate _» . „ 51 50 48 49 49 50 46 48 45 45 47 47 45 45 Pottery 88 87 86 90 93 94 95 93 90 89 88 91 94 92 Textiles, Products 103.9 104.6 103.4 106.0 107.5 105.8 104.4 102.7 99.1 96.6 96.3 96.8 100.2 101. 3 Fabrics ... 94.3 95.2 93.9 97.7 99.7 96.9 95.0 93.1 88.6 87.8 87.7 88.0 91.3 92.7 Carpets, rugs . 74 76 78 83 85 84 85 83 78 79 76 70 71 73 Cotton goods 80 91 91 94 96 95 94 93 89 89 88 89 91 93 Cotton small wares 83 84 86 91 92 91 88 83 77 76 76 76 77 80 Dyeing, finishing textiles 128 129 129 133 132 131 127 124 123 121 123 119 125 128 Hats, fur-felt 93 90 87 86 90 92 91 90 84 65 68 74 85 83 Hosiery 154 155 149 151 151 146 145 145 139 139 134 133 136 139 Knitted outerwear 75 80 75 76 75 68 62 68 65 60 61 65 69 72 Knitted underwear 77 79 78 79 80 79 80 77 77 74 72 72 76 75 Knitted cloth 138 140 140 148 155 146 142 134 133 130 127 131 138 147 Silk, rayon goods 72 72 70 75 77 74 71 66 65 65 67 64 63 62 Woolen, worsted goods 89 85 83 90 95 89 85 81 71 70 73 77 85 86 Wearing apparel 121.1 121 4 120 4 120 4 120 4 121 6 121 3 120.0 118.8 112.4 111.6 112.4 116.1 116.3 Clothing, men's 107 107 106 107 108 112 110 107 107 100 98 102 105 105 Clothing, women's. 174 174 172 171 171 171 167 169 167 156 158 158 166 164 Corsets, allied garments. 115 117 116 117 117 117 117 114 113 111 113 113 106 114 Men's furnishings... 135 140 136 138 127 122 120 120 120 115 114 111 120 124 Millinery. 73 77 80 80 74 75 79 83 83 78 72 71 71 72 Shirts, collars 123 121 121 121 123 123 132 125 122 122 121 116 116 120 <• Revised. 1130 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Factory Employment (Adjusted)—Continued [Index numbers of the Board of Governors; adjusted to Census of Manufactures through 1937. 1923-25 average=100] 1939 1940 Industry and group July Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May June July Aug. Leather, Manufactures 98.7 97.4 96.8 97.4 99.1 96.9 97.3 95.4 93.8 91.9 87.9 89.6 90.9 89.1 Boots, shoes 98 96 95 96 98 96 96 94 93 90 86 88 89 87 Leather . 87 87 87 88 88 86 87 85 83 82 81 81 81 81 Food, Products . ... 127.9 129.7 128.1 126.9 129.6 131.4 130.7 130.8 130.3 128.8 129.1 131.9 129.0 128.9 Baking .. 147 146 146 146 145 145 144 144 145 144 145 146 146 146 Beverages . ... 269 269 269 271 279 285 280 278 275 274 273 278 268 272 Butter 95 96 95 95 97 97 95 96 96 97 98 97 96 96 Canning, preserving _ ..... 150 160 147 137 150 154 149 155 152 150 147 161 137 140 Confectionery .. 82 86 82 82 86 86 85 86 83 82 84 83 86 88 Flour 81 79 82 80 77 79 80 80 80 79 81 80 79 78 Ice cream .. 75 75 76 78 79 79 79 79 80 79 76 77 75 76 Slaughtering, meat packing . . 101 101 102 103 106 108 108 109 110 107 107 109 111 108 Sugar, beet..... -. .. 99 105 131 107 105 118 162 102 102 98 99 102 99 97 Sugar refining, cane .... 94 06 90 100 95 98 94 93 97 94 95 96 97 96 Tobacco Manufactures 65.7 65.2 64.4 63.5 63.1 64.7 64.2 62.7 64.3 65.0 63.2 65.2 62.8 63.2 Tobacco, snuff ..... .. 61 62 62 62 60 60 62 60 60 59 59 59 58 56 Cigars, cigarettes ... . .. .. 66 66 65 64 63 65 65 63 65 66 64 66 64 64 Paper, Printing . .. . . .. 111.8 112.0 112.8 115.0 115.7 116.4 115 5 114.7 114.8 114.3 115.3 115.7 116.4 116.1 Boxes, paper . ... 113 115 116 121 122 121 121 118 116 115 116 118 119 119 Paper, pulp ....... .. 106 107 109 114 115 115 114 113 113 112 115 116 117 117 Book, job printing 101 99 98 99 100 101 102 100 100 101 100 100 101 100 Newspaper, periodical printing... 114 116 116 116 115 116 114 116 117 116 117 116 116 116 Chemicals, Petroleum, and Coal Products . 113 7 111.9 116.4 119.9 121.3 121.9 121 4 120.6 120.0 121 1 122.2 122.6 121.9 122.2 Petroleum refining . . . 121 122 122 122 123 122 122 122 123 122 122 123 122 122 Other than petroleum . ... 111.9 109.4 115.2 119.4 120.8 121.8 121.3 120.3 119. 4 120.9 122.2 '122.6 121.8 122.4 Chemicals . 115 119 122 132 137 138 138 138 137 136 137 138 138 140 Cottonseed oil, cake, meal 85 81 92 98 91 91 92 87 84 97 100 88 84 81 Druggists' preparations . . 114 112 112 113 114 116 119 118 117 119 122 120 120 117 Explosives . . . 92 93 98 102 104 106 104 108 109 116 120 127 133 139 Fertilizers 105 103 111 109 106 111 105 99 102 109 rug 120 114 113 Paints, varnishes 122 125 123 125 126 126 127 124 124 123 121 122 124 126 Rayon, allied products .... 298 254 297 309 310 311 310 309 304 312 311 315 308 306 Soap 84 87 87 87 86 87 86 84 81 81 82 82 83 84 Rubber Products 79.7 83.6 86.1 91.2 93.0 92.4 90.2 87.9 86.7 83.9 '83.5 '"84.2 84.7 86.7 Rubber boots, shoes . ... 47 58 58 60 61 61 59 57 57 57 56 57 56 54 Rubber tires, inner tubes.... .. 67 68 70 74 75 75 74 73 72 70 69 '69 69 71 Rubber goods, other... . 134 138 144 154 159 157 152 145 142 136 138 140 141 148 ' Revised. NOTE.—Figures for August 1940 are preliminary. For description and back data see the BULLETIN for October 1938, pages 835-866, and for October 1939, pages 878-887. Underlying figures are for payroll period ending nearest middle of month. TOTAL NONAGRICULTURAL EMPLOYMENT [Thousands of persons] Employees in nonagricultural establishments Total non- Trans- Finan- Year and month agricul- Manu- Con- porta- cial, serv- Govtural Total factur- Mining struc- tion and Trade ice, and ernem m p e l n oy t1 - ing tion u p t u il b it l i i e c s l m an is e c o e u l s - ment 1929—average 36,710 30,851 10,203 1,064 1,806 3,878 6,404 4,147 3,349 1930—average 34,439 28,609 9,087 982 1,422 3,647 6,065 4,028 3,379 1931—average 31 515 25,791 7,751 847 1,236 3,221 5,530 3,782 3,425 1932—average 28, 289 22,706 6,571 706 821 2,789 4,914 3,471 3,434 1933—average __ . 28,474 22,924 7,036 714 755 2,647 4,941 3,422 3,408 1934—average __ _. 30,890 25,135 8,112 844 840 2,727 5,476 3,627 3,509 1935—average. 32,073 26, 234 8,640 855 908 2,762 5,669 3,771 3,628 1936—average 34 170 28,125 9,350 896 1,211 2,944 5,941 3,978 3,805 1937—average _ 35,882 29,763 10,273 949 1,148 3,102 6,233 4,144 3,915 1938—average . 33 602 27,468 8,731 834 1,001 2,835 6,012 4,059 3,997 1939—average . _ 34,614 28,471 9,301 790 1,213 2,904 6,078 4,108 4,077 1938—Aug. 33,481 27,345 8,633 774 1,119 2,817 5,855 4,096 4,051 Sept 34,035 27,891 8,887 805 1,140 2,876 6,011 4,126 4,046 Oct. 34 109 27, 968 8,922 831 1,156 2,905 6,052 4,061 4,041 Nov . 34,035 27,898 8,988 837 1,089 2,856 6,088 4,021 4,019 Dec. 34,349 28,218 9,048 830 991 2,836 6,450 4,015 4,048 1939_jan. 33,401' 27, 273 8,901 821 954 2,776 5,872 3,976 3,973 Feb 33, 518 27,388 9,025 819 946 2,787 5,843 3,984 3,984 Mar. 33 809 27,667 9,085 819 1,012 2,816 5,923 4,016 3,996 Apr. 33,820 27, 672 9,072 546 1,146 2,838 5,979 4,079 4,012 May 34 109 27, 961 8,983 653 1,270 2,867 6,008 4,133 4,047 June _ - 34, 544 28,400 9,023 793 1,334 2,924 6,063 4,167 4,096 July ______ ___ _ 34, 579 28,436 9,033 787 1,388 2,936 5,992 4,174 4,126 Aug. . 34,856 28,710 9,260 807 1,415 2,946 5,988 4,169 4,125 Sept. 35,447 29, 295 9,583 823 1,399 2,993 6,161 4,209 4,127 Oct. 35 800 29,651 9,862 871 1,366 3,033 6,228 4,158 4,133 Nov. . 35, 647 29,504 9,881 881 1,249 2,988 6,263 4,115 4,127 Dec 35,833 29,697 9,902 866 1,076 2,943 6,614 4,116 4,180 1940—Jan. 34,711 28,579 9,691 853 952 2,887 6,001 4,066 4,129 Feb._ 34,651 28, 518 9,691 854 903 2,893 5,961 4,071 4,145 Mar.. 34,869 28, 725 9,644 849 953 2,895 6,136 4,089 4,159 Apr. 34,908 28, 774 9,548 835 1,089 2,916 6,061 4,148 4,177 May . _ _ 35, 230 29,082 9,502 845 1,248 2,956 6,122 4,194 4,215 June 35,485 29,341 9,534 838 1,317 2,991 6,174 4,214 4,273 July 35 553 29, 413 9,544 837 1,379 3,018 6,078 4,213 4,344 Aug _ 35, 986 29,843 9,854 845 1,420 3,035 6,074 4,220 4,395 NOTE.—Figures compiled by the Bureau of Labor Statistics; monthly figures prior to August 1938 may be obtained from that Bureau. Figures for August 1940 are preliminary. i Includes self-employed persons, casual workers, and domestic servants not included in total of employees in nonagricultural establishments. OCTOBER 1940 1131 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FACTORY EMPLOYMENT AND PAYROLLS, BY INDUSTRIES (Without Seasonal Adjustment) [Index numbers of the Bureau of Labor Statistics; adjusted to Census of Manufactures through 1937. 1923-25 average=100] Factory employment Factory payrolls Industry and group 1939 1940 1939 1940 July Aug. Apr. May June July Aug. July Aug. Apr. May June July Aug. Total _ _. 93.5 96.3 99.6 99.0 99.4 99.5 103.5 84.4 89.7 96.3 96.3 97.9 96.6 103.7 Durable goods 83.0 83.9 96.0 96.5 97.0 95.6 99.4 76.0 81.5 97.2 97.5 r100.0 96.0 104.9 Nondurable goods 103.5 108.1 103.0 101.5 101.7 103.3 107.4 93.7 99.0 95.4 94.9 95.5 97.1 102.4 Iron, Steel, Products . ._ 89.7 92.3 101.7 101.9 103.7 106.2 110.6 78.6 88.0 94.9 97.1 102.8 104.3 113.6 Blast furnaces, steel works 95 97 108 109 114 119 122 82 93 99 103 114 116 125 Bolts, nuts, washers, rivets 93 97 109 106 104 109 116 83 104 114 rllO 111 113 139 Cast-iron pipe 75 75 75 76 77 78 80 66 68 62 67 70 75 76 Cutlery, edge tools 87 92 104 103 101 99 102 76 80 94 92 92 91 94 Forgings 54 56 67 67 66 68 73 55 59 75 73 74 78 86 Hardware 69 76 98 96 82 83 95 65 80 104 102 86 86 107 Plumbers' supplies 77 78 82 82 83 84 86 65 71 72 73 73 74 80 Stamped, enameled ware 144 153 160 156 153 152 164 137 156 164 162 163 166 182 Steam, hot-water heating 76 78 85 85 85 84 90 60 68 76 75 77 78 85 Stoves 86 90 91 91 93 92 97 73 78 82 84 83 81 89 Structural, ornamental 69 72 70 71 74 76 80 59 64 61 62 65 68 73 Tin cans, tinware 100 107 95 96 103 106 108 103 115 101 101 114 113 121 Tools _ _ _ 80 84 94 92 92 94 96 72 79 91 90 89 92 96 Wirework 126 116 162 161 152 136 144 124 116 175 170 161 141 164 Machinery 95.7 96.8 113.6 113.9 115.1 116.1 119.3 94.0 96.9 121.6 122.3 125.1 125.7 131.6 Agricultural implements 113 114 141 140 137 131 131 123 124 166 164 158 149 152 Cash registers, etc. 127 125 129 129 130 130 129 123 119 134 134 138 136 136 Electrical machinery 87 88 102 102 103 104 107 91 93 113 114 118 118 126 Engines, turbines, etc. 96 97 140 149 158 168 175 110 114 183 194 211 224 239 Foundry, machine-shop products- 83 84 97 97 97 98 101 75 78 95 95 96 96 101 Machine tools 147 140 216 221 229 235 238 166 161 287 290 303 308 303 Radios, phonographs 130 136 128 137 141 143 157 114 123 116 127 134 139 150 Textile machinery 77 78 85 82 79 77 76 75 75 80 77 74 73 74 Typewriters 121 118 114 113 111 114 118 113 117 112 114 112 117 125 Transportation Equipment 79.9 75.2 115.4 115.0 '112. 3 97.6 103.4 76.6 78.3 122.6 116.6 96.2 112.3 Aircraft 1, 399 1,414 2,166 2,328 2,519 2,703 2,872 1,338 1,381 2,063 2,213 2, 514 2,635 2,973 Automobiles 76 70 112 110 105 83 88 73 75 121 111 80 97 Cars, eleotric-, steam-railroad 32 32 57 56 51 51 50 25 27 52 50 45 43 46 Locomotives 29 29 28 28 29 31 33 27 27 26 27 29 31 33 Shipbuilding. 124 122 153 158 163 170 180 132 128 169 180 186 193 210 Nonferrous Metals, Products __ 91.3 94.7 105.6 105.3 106.9 113.8 82.4 88.7 103.1 103.6 »105. 5 105.8 116.9 Aluminum 150 154 172 173 177 181 187 148 163 199 202 204 194 224 Brass, bronze, copper 104 108 126 126 127 130 139 104 111 133 134 141 146 162 Clocks, watches 80 83 89 90 '91 90 95 76 85 92 94 '92 91 97 Jewelry.. 87 94 90 89 91 93 99 69 77 72 73 76 76 83 Lighting equipment 71 73 86 84 84 77 88 54 58 74 72 70 64 78 Silverware, plated ware __ 63 69 71 70 68 63 70 51 59 63 61 56 51 62 Smelting, refining 76 75 86 86 87 89 90 71 71 84 84 86 87 88 Lumber, Products 66.7 68.7 66.9 68.0 68.3 68.2 70.6 56.4 62.9 61.4 63.3 63.6 60.7 67.8 Furniture . _ 84 88 86 87 88 88 91 68 76 74 75 76 74 82 TiVimhflr, millwnrk 60 62 61 61 62 63 64 45 50 48 48 49 49 53 Lumber, sawmills __ 61 63 60 62 62 62 64 51 57 55 58 58 54 61 Stone, Clay, Glass Products 79.7 80.8 80.5 82.0 82.9 82.6 84.4 65.9 71.6 72.2 74.6 73.4 71.4 76.5 Brick, tile, terra cotta 62 62 58 61 63 64 64 46 50 45 49 51 52 54 Cement _ _ __ . _ _ 73 73 68 71 72 72 73 68 70 64 69 70 68 71 Glass 96 99 105 104 105 104 108 92 103 114 112 111 106 117 Marble, granite, slate 54 53 46 49 49 48 49 40 41 34 39 36 34 37 Pottery 82 85 93 91 90 87 90 65 74 85 84 76 71 78 Textiles, Products _ 97.9 103.2 98.8 96.0 93.7 94.5 99.9 79.2 88.1 81.4 77.9 75.4 77.7 87.2 Fabrics 90.9 93.0 88.3 87.0 85.7 88.0 90.5 76.6 80.2 75.2 73.9 72 5 76.4 80.9 Carpets, rugs __ 74 76 80 76 70 71 73 57 64 68 60 55 54 61 Cotton goods ' 86 87 91 89 87 88 89 73 75 81 78 75 78 79 Cotton small wares _ ... 80 81 79 76 74 74 "77 73 76 73 68 67 69 73 Dyeing, finishing textiles 119 122 125 123 116 116 121 98 103 105 99 93 95 102 Hats, fur-felt 90 94 65 66 71 83 87 82 84 39 46 58 78 83 Hosiery. ______ _ ._ 149 152 140 134 130 131 137 145 162 144 134 128 130 146 Knitted outerwear 72 78 60 62 63 66 70 57 64 47 50 51 54 60 Knitted underwear 73 77 77 74 73 72 73 65 68 69 65 64 63 66 Knitted cloth 136 140 131 127 128 136 148 114 117 101 104 107 117 129 Silk, rayon goods 69 72 64 62 60 61 63 51 55 50 49 46 47 51 Woolen, worsted goods 86 86 67 72 76 83 87 73 72 53 60 65 74 78 Wearing apparel. 109.5 122.1 118.6 112.1 107.8 104.9 117.0 79.7 98.3 88.7 81.0 76.6 75.6 94.3 Clothing, men's 105 110 104 95 99 103 108 79 86 72 65 71 77 81 Clothing, women's _ 144 174 168 163 148 137 164 97 133 119 112 95 89 128 Corsets, allied garments 112 114 115 114 112 103 111 113 112 120 117 109 100 110 Men's furnishings 124 131 118 115 110 110 116 106 120 101 96 95 98 114 Millinery 56 78 87 75 66 55 72 37 67 74 54 47 37 (63 Shirts, collars 118 120 125 121 115 111 119 91 103 111 101 92 88 105 ' Revised. 1132 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Factory Employment and Payrolls—Continued [Index numbers of the Bureau of Labor Statistics: adjusted to Census of Manufactures through 1937. 1923-25 average=100] Factory employment Industry and group 1939 1940 July Aug. Apr. May June July Leather Manufactures 99.7 100.7 94.2 86.8 86.8 91 6 Boots, shoes. . _ , 99 100 93 85 85 91 Leather 86 86 83 81 80 80 Foody Products 135.0 147.0 119.7 '121. 7 129.7 135 5 Baking _ _ 148 147 143 145 147 147 Beverages 301 295 268 279 '302 300 Butter 104 103 94 100 105 105 Canning, preserving 197 289 103 100 141 180 Confectionery «_ 70 79 77 76 75 74 Flour _ 83 80 78 • 79 78 80 Ice cream 93 89 75 84 92 92 Slaughtering, meat packing 101 100 104 106 108 111 Sugar, beet .. ... 57 88 44 47 53 58 Sugar refining, cane 98 99 94 95 98 101 Tobacco Manufactures 65.4 66.6 63.8 62.2 64.9 62.4 Tobacco, snuff. _ _ 59 61 59 59 58 56 Cigars, cigarettes 66 67 64 63 66 63 Paper, Printing 110.1 110.9 113.8 115.0 114.5 114 7 Boxes, paper 110 114 113 114 115 116 Paper, pulp - . 106 107 112 115 116 117 Book, job printing 99 98 100 99 97 99 Newspaper, periodical printing ... 112 112 117 117 116 114 Chemicals, Petroleum, and Coal Products 110.5 109.2 123 4 120 8 119 1 118 6 Petroleum refining _ «._ 122 123 121 122 123 123 Other than petroleum 107.8 105.9 123.9 120.6 118.1 117.6 Chemicals 117 119 135 136 138 140 Cottonseed oil, cake, meal 49 57 79 68 55 49 Druggists' preparations 109 110 119 118 116 114 Explosives _ _ 91 93 114 118 126 133 Fertilizers 73 74 175 129 89 80 Paints, varnishes 122 122 124 126 126 125 Rayon, allied products . 297 255 306 304 306 307 Soap- . . - - . 82 86 81 81 82 81 Rubber Products . _ 78.7 82.6 84.7 '83.8 '83.4 83.5 Rubber boots, shoes 45 59 56 54 55 54 Rubber tires, inner tubes. 67 68 70 69 '69 Rubber goods, other 131 133 140 140 '138. SO OG OCOO Factory payrolls 1939 Aug. July 92 1 83.6 91 82 80 82 144 3 128.6 147 139 299 359 103 89 253 154 80 64 79 80 91 77 107 109 81 54 98 64.6 55 66 115 0 118 117 99 113 119 4 122 118.7 141 57 115 140 81 124 308 83 85.7 55 71 143 OO COCOCO G i—i i—I r>. i—i o oo c 1940 Aug. Apr. May June July Aug. 84.6 70.7 63.6 67.0 76.4 77.2 83 67 58 63 75 75 83 78 77 76 76 77 135.1 117.7 121.5 129.0 131.4 138.1 135 134 138 141 142 140 350 312 '331 '376 353 356 87 81 85 91 90 89 251 83 90 117 147 240 77 74 75 72 69 78 77 72 73 72 76 76 74 63 70 '78 78 78 106 110 110 115 118 112 86 48 49 54 56 78 81 77 80 89 91 85 62.7 58.7 60.7 66.9 62.3 63.0 67 64 67 67 67 66 62 58 60 67 62 63 103.7 109.7 113.1 112.0 111.2 110.7 117 125 121 125 127 127 131 101 108 115 124 126 126 125 86 83 87 88 85 87 86 102 102 111 112 110 106 106 117.8 119 0 133.4 133.6 '•133. 2 133.5 135.0 132 136 137 137 137 137 138 113.6 113.8 132.3 132.6 132.1 132.5 134.2 131 136 160 162 165 169 171 42 48 69 60 49 47 53 119 121 131 129 126 125 128 103 109 133 141 154 167 172 63 63 136 '118 '78 70 71 124 126 132 136 136 132 132 283 247 311 311 314 315 318 99 102 98 98 100 100 102 81.5 86.3 86.5 87.2 86.4 85.2 90.2 43 58 55 54 56 51 57 77 79 78 80 78 77 80 121 127 133 132 133 132 142 ' Revised. NOTE.—Figures for August 1940 are preliminary. Back data may be obtained from the Bureau of Labor Statistics. Underlying figures are for payroll period ending nearest middle of month. HOURS AND EARNINGS OF WAGE EARNERS IN MANUFACTURING INDUSTRIES [Compiled by the Bureau of Labor Statistics] Average hours worked per week Average hourly earnings (cents per hour) Industry group 1939 1940 1939 1940 June July Mar. Apr. May June July June July Mar. Apr. May June July Total _ 37.3 36.7 37.5 37.2 37.2 37.5 37.3 64.2 63.7 66.5 66.5 66.9 67.2 66.7 Durable goods 37.4 36.2 83.2 38.2 38.7 37.9 70.8 70.2 72.8 72.9 73.0 73.2 72.7 Iron, Steel, Products. 35.6 34.2 36.1 36.0 36.6 37.6 37.2 75.6 75.9 76.3 76.4 76.7 77.4 77.7 Machinery 38.6 38.0 40.7 40.5 40.5 40.8 40.5 72.5 72.4 73.9 73.9 74.1 74.3 74.4 Transportation E quipment 35.6 35.1 38.4 38.3 36.7 38.1 36.2 89.5 88.6 90.0 90.2 90.2 90.5 89.1 Nonferrous Metals, Products 38.2 37.4 38.9 38.6 38.8 39.0 38.6 67.1 67.2 69.7 70.0 70.1 70.2 70.1 Lumber, Products 39.4 36.9 38.4 38.4 38.7 38.5 37.0 50.4 49.8 51.5 51.8 52.1 52.3 51.9 Stone. Clay, Glass Products 37.2 35.1 35.7 36.5 37.1 36.3 35.5 64.7 64.6 66.4 66.4 66.4 66.4 66.5 Nondurable goods 37.2 37.1 36.9 36.2 36.3 36.4 36.7 59.0 58.7 61.0 61.5 61.7 61.5 Textiles, Products 35.4 35.2 35.1 34.2 33.7 33.5 33.8 47.3 47.2 50.5 49.5 49.6 49.6 50.2 Fabrics 35.9 35.9 35.1 34.5 34.3 34.1 34.8 45.9 46.0 48.2 48.2 48.4 48.4 48.6 Wearing apparel 34.6 33.6 35.2 33.6 32.7 32.5 31.9 49.9 49.6 54.3 51.9 51.8 51.8 53.4 Leather, Manufactures 35.3 37.8 35.6 32.5 30.9 33.2 35.9 52.9 52.2 54.1 54.3 55.5 55.3 55.3 Food, Products.-. 40.3 39.9 39.8 39.4 40.1 40.1 39.9 62.2 61.3 64.1 64.3 64.7 64.1 62.4 Tobacco Manufactures 36.6 37.0 34.5 34.7 36.4 38.1 36.8 47.4 47.6 49.0 49.3 49.7 50.5 49.9 Paper, Printing 38.0 37.5 38.0 38.1 38.8 38.5 38.4 77.6 77.2 78.9 79.3 79.4 79.7 79.1 Chemicals, Petroleum, and Coal Products. --. 38.4 37.8 38.4 38.5 38.8 38.5 38.5 75.7 76.6 74.6 74.2 76.0 77.7 78.3 Petroleum refining 36.1 34.7 36.2 36.5 36.2 35.7 35.3 97.2 98.5 97.1 97.4 97.5 98.3 98.6 Other than petroleum refining. 39.3 39.1 39.2 39.2 39.7 39.6 39.7 67.2 67.8 67.0 66.5 70.2 70.8 Rubber Products __. 36.5 36.5 35.8 36.0 36.4 36.4 35.7 76.5 77.2 77.9 77.9 78.0 78.5 OCTOBER 1940 1133 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

CONSTRUCTION CONTRACTS AWARDED, BY TYPES OF CONSTRUCTION [Figures for 37 States east of the Rocky Mountains, as reported by the F. W. Dodge Corporation. Value of contracts in millions of dollars.] Nonresidential building Public works Total R b e u si i d ld e i n n t g ial an u d ti li p ti u e b s l > ic Month Factories Commercial Educational i Other * 1939 1940 1939 1940 1939 1940 1939 1940 1939 1940 1939 1940 1939 1940 January _ 251.7 196.2 80.2 77.4 7.1 12.9 17.3 15.9 31.7 6.1 28.9 17.7 86.5 66.3 February 220.2 200.6 79.0 74.9 9.5 15.4 13.5 20.2 21.8 8.1 24.7 26.9 71.6 55.2 March. _ 300.7 272.2 125.2 121.7 13.0 21.8 17.4 23.1 27.6 9.3 39.8 19.6 77.7 76.7 April _ 330.0 300.5 114.4 135.4 17.5 23.5 21.3 24.0 21.1 17.4 34.8 24.0 121.0 76.3 May 308.5 328.9 133.8 145 9 13.0 23.2 19.5 26.1 16.4 15.3 27.8 25.6 97.9 92.8 June 288 3 324 7 111 9 135 3 15 8 15 2 26 8 33 1 12.5 14.3 37.8 29.4 83.6 97.5 July 299.9 398.7 109.3 140 4 17.4 49.5 22.9 38.9 19.4 16.5 28.7 34.1 102.1 119.3 August 312. 3 414.9 127.2 153.0 10.4 39.6 21.1 28.6 13.8 14.4 24.6 36.6 115.3 142.8 September 323.2 129.7 20.7 26.6 10.1 24.9 111.1 NOoctvoebmerber 2 2 6 9 1 9 .8 8 1 1 1 1 8 6 .6 3 1 1 6 8 . . 8 5 2 2 2 0 . . 6 4 9 9 . .7 5 2 2 3 9 . . 8 2 1 7 0 0 5 . . 8 5 December 354.1 88.7 15.3 17.4 7.7 17.4 207.7 Year 3, 550. 5 1,334.3 174.8 246.9 201.4 342.5 1, 250. 6 i Not strictly comparable with data for earlier years due to changes in classification. CONSTRUCTION CONTRACTS AWARDED, BY TYPES OF FINANCING [Figures for 37 States east of the Rocky Mountains, as reported by the F. W. Dodge Corporation. Value of contracts in millions of dollars.] Total Publicly-financed * Privately-financed i Month 1935 1936 1937 1938 1939 1940 1935 1936 1937 1938 1939 1940 1935 1936 1937 1938 1939 1940 January 100 215 243 192 252 196 55 149 112 118 148 93 45 66 130 75 104 104 February « 75 140 188 119 220 201 38 79 69 51 111 82 37 62 119 68 109 119 March 123 199 231 227 301 272 68 96 66 95 128 95 55 103 165 132 173 177 April 124 235 270 222 330 301 53 105 74 99 160 103 71 130 195 123 170 197 May 127 216 244 283 308 329 47 94 93 144 135 112 80 122 151 139 174 217 June. __ 148 233 318 251 288 325 64 116 137 108 128 147 84 116 180 143 161 177 July ' 159 295 322 240 300 399 67 153 131 98 137 205 93 141 191 142 163 194 August __ 169 275 281 313 312 92 153 104 171 158 76 122 178 142 154 September 167 234 207 301 323 97 116 80 160 144 70 119 127 141 179 October 201 226 202 358 262 114 101 78 203 92 87 125 124 154 170 November 188 208 198 302 300 118 89 93 179 144 70 119 106 123 156 December 264 200 209 389 354 196 82 115 279 225 68 117 94 110 129 Year 1,845 2,675 2,913 3,197 3,551 1,007 1,334 1,152 1,705 1,708 837 1,341 1,761 1,492 1,842 i Back figures.—SeeB ULLETIN for February 1938, p. 159. Data for years prior to 1932 not available. CONSTRUCTION CONTRACTS AWARDED, BY DISTRICTS COMMERCIALFAILURES, BY DISTRICTS [Figures for 37 States east of the Rocky Mountains, as reported by the[Figures reported by Dun & Bradstreet. Amounts in thousands of F. W. Dodge Corporation. Value of contracts in thousands of dollars.] dollars.] 1940 1939 Number Liabilities Federal Reserve district Aug. July Aug. Federal Reserve 1940 1939 1940 1939 district Boston _ 23,711 53,489 22,639 Aug. July Aug. Aug. July Aug. New York 55,220 58,206 72,993 P C h le il v a e d la e n lp d h ia __ _ _ _ 3 1 5 7 , , 9 6 5 8 1 5 2 36 9 , , 1 7 3 5 6 2 2 3 5 1 , , 5 5 0 1 3 3 Boston 77 88 70 1,082 1,513 513 Richmond 47,363 57,234 32,213 New York.. 408 419 437 4,258 4,215 4,710 Atlanta 97,509 40,459 19,759 Philadelphia 62 91 59 680 749 463 Chicago _ _._ 62,485 58, 534 52,434 Cleveland 46 69 53 684 1,825 731 St. Louis. 25,170 21,016 20,226 Richmond 42 51 39 713 756 249 Minneapolis., 12,195 10,075 8,747 Atlanta . . 53 64 65 424 466 752 Kansas City 11,410 14, 761 8,464 Chicago 177 155 177 2,379 2,081 2,289 Dallas.. 26, 242 19,011 17,837 St. Louis 42 33 29 638 419 307 Minneapolis 18 11 22 219 58 282 Total (11 districts) 414,941 398, 673 312,328 K D a a n ll s a a s s City 3 5 4 2 3 3 0 8 5 2 3 3 3 2 8 3 4 9 2,3 4 2 3 0 0 4 3 1 4 3 0 San Francisco 117 126 99 1,297 1,381 1,588 Total 1,128 1,175 1,126 12,997 16,213 12, 637 New series. Includes cases of discontinuances where loss to creditors was involved even though actual legal formalities were not invoked. Back figures, available for 1939 only, may be obtained from Dun and Bradstreet, Inc. 1134 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MERCHANDISE EXPORTS AND IMPORTS [In millions of dollars] Merchandise exports 1 Merchandise imports a Excess of exports Month 1936 1937 1938 1939 1940 1936 1937 1938 1939 1940 1936 1937 1938 1939 1940 January, „ 199 223 289 213 370 187 240 171 178 242 11 -18 118 35 128 February 182 233 262 219 347 193 278 163 158 200 -11 —45 99 61 147 March _ 195 257 275 268 351 199 307 173 190 217 -4 -51 102 77 135 April 193 269 274 231 324 203 287 160 186 212 —10 -18 115 45 112 May .. 201 290 257 249 325 192 285 148 202 211 9 5 109 47 114 June 186 265 233 236 350 191 286 146 179 211 -5 -21 87 57 139 July 180 268 228 230 317 195 265 141 169 232 -15 3 87 61 85 August . 179 277 231 250 P350 193 246 166 176 P220 — 14 31 65 74 P130 September 221 297 246 289 216 233 168 182 5 63 79 107 October 265 333 278 332 213 224 178 215 52 108 100 117 November _. 226 315 252 292 196 223 176 235 30 92 76 57 December __ 230 323 269 368 245 209 171 247 -15 115 98 121 Year 2,456 3,349 3,094 3,177 2,423 3,084 1,960 2,318 33 265 1,134 859 9 Preliminary. - Including both domestic and foreign merchandise. General imports, including merchandise entered for immediate consumption and that entered for storage in bonded warehouses. Source.—Bureau of Foreign and Domestic Commerce. Back figures.—See BULLETIN for February 1937, p. 152; July 1933, p. 431; and January 1931, p. 18. FREIGHT-CAR LOADINGS, BY CLASSES DEPARTMENT STORE SALES AND STOCKS [Index numbers; 1923-25 average=100] [Index numbers based on value figures; 1923-25 average=100] 1939 1940 Sales i Stocks (end of month) Aug. Apr. May June July Aug. Adjusted Without Adjusted Without Month for seasonal seasonal for seasonal seasonal variation adjustment variation adjustment Adjusted for seasonal variation 1939 1940 1939 1940 1939 1940 1939 1940 Total 70 70 72 7fi' 75 76 Coal . 78 75 78 81 83 85 Coke 69 73 73 91 105 108 January 88 92 69 71 67 68 60 61 Grain and grain products. _ 75 79 74 74 80 74 February 87 89 69 71 68 71 65 68 Livestock 37 37 38 38 35 38 March 88 89 82 86 68 70 69 71 Forest products 42 43 45 45 46 49 Ore 67 102 96 100 96 96 April 88 89 88 86 67 69 69 71 Miscellaneous 74 74 77 82 80 82 May > 85 87 87 89 66 68 68 70 Merchandise 1 - 62 59 60 60 61 61 June _ _ 86 91 83 87 67 67 64 64 July 86 91 60 64 67 68 60 61 Without seasonal adjustment August 89 99 69 77 67 69 65 66 September 91 97 68 71 Total 71 67 71 75 77 78 October 90 99 69 77 Coal 69 63 67 69 70 75 November 95 106 71 82 Coke 57 62 70 85 89 88 December 96 168 68 64 Grain and grain products 90 70 66 73 110 89 Livestock 37 34 34 31 31 38 Year 90 68 Forest products 44 44 47 48 46 51 Ore 125 42 134 170 182 178 Miscellaneous 75 76 80 85 82 83 * Based on daily average sales—with allowance for changes from Merchandise * 62 60 60 60 60 61 month to month in number of Saturdays and in number of Sundays and holidays. Adjustment for seasonal variation makes allowance in March and April for the effects upon sales of changes in the date of Easter. i In less-than-carload lots. NOTE.—For description and back data see pp. 522-529 of BULLETIN Back figures.—Department store sales, see BULLETIN for August for June 1937. Based on daily average loadings. Basic data compiled 1936, p. 631, and for October 1938, p. 918; department store stocks, see by Association of American Railroads. Total index compiled by com- BULLETIN for March 1938, p. 232. bining indexes for classes with weights derived from revenue data of the Interstate Commerce Commission. OCTOBER 1940 1135 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

WHOLESALE PRICES, BY GROUPS OF COMMODITIES [Index numbers of the Bureau of Labor Statistics. 1926=100] Other commodities Year, month, or week m c t A o i o e m l d s l i - - F p u r a c o r t d m s - Foods Total H p l i r e d o a e d t s h u e a c r n ts d p T ro e d x u ti c le ts F m li u g a e h t l e t r i a n i n a g d ls a p n M r d o e d m t u a e c l t s t a s l B m u a i t l e d r i i n a g ls p c C r a a o l h l s d l e i u e m a c d n t i s d - *i f n H u g r o n g u i o s s o h e- d - s l M an is e c o e u l s - 1929 95.3 104.9 99.9 91.6 ]09.1 90.4 83.0 100.5 95.4 94.0 94.3 82.6 1930 86.4 88 3 90 5 85.2 ]00.0 80.3 78.5 92.1 89.9 i58.7 92.7 77.7 1931 73.0 64.8 74.6 75.0 86.1 66.3 67.5 84.5 79.2 rg. 3 84.9 69.8 1932 .. 64.8 48 2 61 0 70.2 72.9 54.9 70.3 80.2 71.4 75.1 64.4 1933 65.9 51.4 60.5 71.2 80.9 64.8 66.3 79.8 77.0 »?2.1 75.8 62.5 1934 74.9 65.3 70.5 78.4 86.6 72.9 73.3 86.9 86.2 r5 3 81.5 69.7 1935 80.0 78 8 83.7 77.9 89.6 70.9 73.5 86.4 85.3 *r9.o 80.6 68.3 1936 80 8 80 9 82 1 79.6 95.4 71.5 76.2 87.0 86.7 >rs.7 81.7 70.5 1937 86.3 86.4 85.5 85.3 ]L04.6 76.3 77.6 95.7 95.2 82.6 89.7 77.8 1938 78 6 68 5 73 6 81.7 92.8 66.7 76.5 95.7 90,3 77. o 86.8 73.3 1939 77.1 65.3 70.4 81.3 95.6 69.7 73.1 94.4 90.5 r6.o 86.3 74.8 1939—July 75.4 62.6 67.5 80.2 92.5 67.6 72.8 93.2 89.7 74 5 85.6 73.4 August 75 0 61 0 67 2 80.1 92.7 67.8 72.6 93.2 89.6 74.2 85.6 73.3 September . 79.1 68.7 75.1 82.1 98.5 71.7 72.8 94.8 90.9 76. 6 86.6 76.6 October 79.4 67 1 73 3 83.8 L04.6 75.5 73.9 95.8 92.8 77.6 87.8 77.6 November . 79.2 67.3 72.3 84.0 L04.0 76.4 74.1 96.0 93.0 77.4 88.4 77.0 December 79.2 67.6 71.9 83.9 L03.7 78.0 72.8 96.0 93.0 77.7 88.5 77.4 1940—January _ 79.4 69.1 71.7 83.9 L03.6 77.9 72.7 95.8 93.4 77.7 87.9 77.7 February 78.7 68.7 71.1 83.2 L02.4 75.4 72.4 95.3 93.2 77.5 88.0 77.3 March 78.4 67.9 70.2 82.9 L01.8 74.0 72.2 95.5 93.3 77 0 88.0 76.9 April 78.6 69 4 71 6 82.5 101.8 72.9 71.8 94.5 92.5 76.8 88.4 77.7 May 78 4 67 9 71 4 82 5 101. 3 72.9 71.7 94.5 92.5 76.7 88.5 77.7 June _. 77.5 66.2 70.3 82.2 99.2 72.6 71.4 94.7 92.4 76.1 88.5 77.3 July.. 77.7 66.5 70.3 82.3 99.0 72.4 71.1 95.1 92.7 77.0 88.5 77.7 August 77.4 65.6 70.1 82.0 96.9 72.3 71.1 94.9 93.5 76.7 88.5 76.7 Week ending— 1940—June 22. . . . 77.1 65.6 70.1 82.4 99.6 71.9 71.9 94.8 92.3 76 3 89.9 77.2 June 29 77.1 65.7 69.7 82.3 99.9 72.0 71.9 94.8 92.4 76.0 89.9 76.9 July 6 77.5 66.7 70.4 82.4 100.3 71.9 72.0 94.9 92.6 77.1 90.0 77.0 July 13 77.9 68 0 71.0 82.4 99.9 72.0 71.9 94.9 92.7 77.0 90.0 77.2 July 20._. 77.6 67.3 70.4 82.4 99.9 71.9 71.8 94.9 92.8 76.9 90.0 77.3 July 27 77.3 66 0 69 6 82.4 99.0 71.8 71.8 94.9 92.7 76.8 90.0 77.7 August 3 _ 77.0 65.2 69.1 82.3 98.1 71.8 71.7 94.9 92.8 76.8 90.0 77.4 August 10 76 9 65 2 69.3 82.2 97.9 71.8 71.6 94.9 92.8 76.7 90.0 76.7 August 17 77.2 65.3 70.1 82.1 97.7 71.7 71.7 94.9 93.1 76.5 90.0 76.4 August 24 77.2 65.6 70.0 82.1 97.0 C71.7 71.7 94.9 93.4 76.4 90.0 76.4 August 31 77.7 66.7 71.4 82.2 97.1 71.7 71.7 95.0 93.5 76 5 90.0 76.2 September 7 78.0 67.6 71.6 82.3 97.8 71.8 71.8 95.0 94.2 76.8 90.0 76.4 September 14 77.9 66.8 71.3 82.5 98.6 71.9 71.8 95.3 94.4 76.8 90.0 76.3 September 21 77 7 65 7 71 1 82 5 99.0 72.0 71.9 95.3 94.2 76.8 90.0 76.3 September 28 77.7 65.7 70.8 82.6 99.3 72.1 71.8 95.7 94.7 76.7 90.0 76.1 1939 1940 1939 1940 Subgroups Subgroups Aug. May June July Aug. Aug. May June July Aug. Farm Products: Metals and Metal Products: Grains 51 5 71 2 64 4 60 8 59.3 Agricultural implements 93.5 92.5 92.5 92.4 92.3 Livestock and poultry 66 0 69 6 64 7 69 8 71 5 Farm machinery 94.7 93.7 93.6 93 5 93.5 Other farm products 60 1 65 5 67.0 65 6 63.3 Iron and steel 95.1 94.2 94.3 94.6 94.8 Foods: Motor vehicl3S 92.5 94.8 94.8 95.6 95.6 Dairy products 67 9 72.8 72.2 73.7 74.3 Nonferrous nietals 74.6 80.3 81.2 80.8 79.1 Cereal products 71.9 81.0 77.4 76.2 75.1 Plumbing and heating.. 79.3 80.6 80.5 80.5 80.5 Fruits and vegetables5 . 58.5 69.2 73.9 69.0 63.2 Building Materials: Meats 73 7 73.8 70.7 72.9 76.1 Brick and tile 90.5 90.2 90.2 90.1 90.1 Other foods 60 3 62 2 61 3 61 3 60.4 Cement _. 91.3 90.5 90.6 90.6 90.6 Hides and Leather Products' Lumber 91.8 96.6 96.0 96.7 100.3 Shoes 100 8 107.9 107. 9 107.0 107.0 Paint and paint materials 82.1 86.0 85.2 84.6 84.2 Hides and skins 77.2 92.2 81.9 84.6 77.1 Plumbing and heating.. 79.3 80.6 80.5 80.5 80.5 Leather 84 0 93 6 92.4 91.4 88.3 Structural steel 107.3 107.3 107.3 107.3 107.3 Other leather products 97.1 100.0 100.0 99.7 99.7 Other building materials 89.5 92.2 93.0 93.6 93.4 Textile Products: Chemicals and Allied Products:^ Clothing 81 5 85.0 85.3 85.3 85.6 Chemicals *__ 83.8 85.1 85.1 84.9 84.8 Cotton goods 65.5 69.4 68.4 68.8 68.6 Drugs and Pharmaceuticals i 77.1 82.0 82.2 95.9 96.2 Hosiery and underwear 61 5 61.3 61.6 61.5 61.5 Fertilizer materials * 65.5 70.8 67.4 67.3 68.0 Silks 44.3 47.0 46.1 43.3 43.0 Mixed fertilizers J 73.1 73.0 72.8 72.8 74.2 Rayon * 28 5 29 5 29.5 29.5 29.5 Oils and fats 1 40.6 46.1 45.1 43.0 39.1 Woolen and worsted goods... 75.5 83.4 83.7 83 9 83.7 Housefurnishing Goods: Other textile products 63 7 75 7 74 0 73 0 71.9 Furnishings 90.0 94.8 94.9 94 8 94 8 Fuel and Lighting Material: Fiirniture 81.1 81.9 81.7 81.8 81.8 Anthracite . . __ 72.1 76.5 77.1 78.1 79.0 Miscellaneous: Bituminous coal 96 0 95 8 95.7 95.8 96.2 Auto tires and tubes. 60.5 58.0 58.2 58.8 58.8 Coke.. 104 2 109.6 109.6 109.6 109. 6 Cattle feed 68.4 93.3 80.0 DO O 74.5 Electricity 75 8 73 9 Paper and puln 80.0 90.7 91.7 93 5 93 5 Gas .... 86.7 84.4 87.4 88.2 Rubber, cru<Le 34.9 44.1 46.3 44.2 41.0 Petroleum products. 51.7 50.7 50.0 49.5 ~49.~2~ Other miscelaneous 81.3 84.3 83.7 83.5 82.8 i Revised series. 15 Corrected. »New series. Back figures.—For monthly and annual indexes of groups, see Annual Report for 1937 (table 86); for indexes of subgroups, see Annual Report foi 1937 (table 87). 1136 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

STATISTICS FOR FEDERAL RESERVE CHART BOOK—CURRENT SERIES Chart 1940 Chart 1940 book book page Aug. Sept. Sept. Sept. Sept. page June July Aug. 28 4 11 18 25 WEEKLY FIGURES Wednesday figures; in billions of MONTHLY FIGURES Index numbers RESERVES, GOLD, AND dollars BUSINESS CONDITIONS 1928-25=100 CURRENCY Wholesale commodity prices:4 United States: Reserve Bank credit—total. 3, 5 2.48 2.49 2.49 2.50 2.47 All commodities.. 31, 32 77.5 77.7 77.4 Bills discounted.. 5 0) .01 .01 0) 0) Farm products 31 66.2 66.5 65.6 U. S. Gov't. securities__ 5 2.44 2.43 2.43 2.43 2.43 Foods.. _ __ 31 70.3 70.3 70.1 Gold stock ___ 3 20.87 20.94 20.98 21.09 21.17 Other commodities 31 82.2 82.3 82.0 M Tr o e n a e su y ry in c c a i s r h c ulation. _ 3, 9 3 8 2 . . 0 2 1 9 8 2 . . 0 2 9 9 8 2 . . 0 2 8 9 8 2 . . 0 3 8 1 8 2 . . 0 3 9 0 E Fr n a g n l c a e n d 3 3 2 2 108.6 P112. 7 P113.0 Treasury deposits 3 .81 .79 .76 .79 .79 Germany _ _ 32 P82. 1 P82.4 P82.4 E M R x e e c q m e u s b i s r e e r r d e s b r e a e r n s v e k e r s v b — e a s l t a o e n ta c l e s * e 3 6 6 7 1 6 7 3 . . . 4 0 5 9 3 2 P 1 6 7 3 . . . 0 5 5 3 2 2 P 1 7 6 3 . . . 0 6 5 6 0 5 P 1 6 7 3 . . . 0 6 6 0 9 2 1 7 3 . . 0 7 6 0 Indu N D st o u r n r i a a d l b u l p r e a r o m b d l a e u n c m u t f i a o a n n c u t 8 f u a * r c e t s u 8 res6 3 3 3 5 7 7 4 5 9 3 1 . . 2 6 3 1 5 5 2 0 1 . . 2 4 0 1 P P P 5 5 1 1 2 2 . . 2 7 2 N Ch ew ic a Y g o o r 2 k City 2 __ 7 7 3. . 3 5 7 2 3. . 3 5 4 2 3. . 2 5 8 4 3. . 3 5 1 8 Fact M or i y n e e r m al p s l • o yment 4 3 3 7 9 1 9 8 . . 4 0 9 1 9 8 . . 5 2 P » 10 1 3 7 . . 6 5 R C e o s u e n r t v r e y c b it a y n k b s a n 2 k e s 2 7 7 1 . .7 8 8 2 P 1 . . 8 8 0 5 P 1 . . 8 8 4 8 P 1 . . 8 8 2 8 F Fr a e c i t g o h r t y - c p a a r y l r o o a l d ls i ngs 5 4 4 5 3 97 7 .9 5 96 7 .5 5 P103. 7 6 7 Department store sales 5 47 91 91 99 WEEKLY REPORTING Department store stocks 6 47 67 68 MEMBER BANKS Total, 101 cities: In millions of dollars Loans and investments. 14 24.16 24.19 24.29 24.28 24.17 Investments 14 15.65 15.62 15.63 15. 59 15.48 onstruction contracts awarded:7 Loans 14 8.51 8.57 8.67 8.69 8.69 Total 41 303 347 P377 Ad d j e u p s o te s d it s demand 15 21.05 20.90 21.08 20.98 21.08 R O e th si e d r ential _ __ _ _ 4 4 1 1 1 17 2 5 8 2 1 0 4 6 1 P P 2 1 2 4 9 8 Time deposits 15 5.34 5.36 5.36 5.36 5.35 Exports and imports: TJ. S. Gov't. deposits ... 15 .53 .53 .53 .53 .53 Exports (incl. re-exports)... 49 350 317 J>350 Domestic bank balances 15 8.39 8.51 8.57 8.69 8.54 General imports 49 211 232 P220 New F o Y r o e r i k g n C b i a ty n : k balances. _ 15 .68 .67 .67 .68 Inco E m x e c e p s a s y o m f e e n x t p s o : rts 49 139 85 P130 TJ. S. Gov't. obligations. 16 5.40 5.40 5.42 5.39 5.31 TotaH 50 6,066 6,107 *6,176 Other securities 16 1.43 1.44 1.43 1.46 1.45 Total unadjusted 50 6,252 6,075 P5, 761 Commercial loans 16 1.69 1.69 1.74 1.75 1.75 Salaries and wages B _ 50 3,822 3,861 P3,918 Brokers' loans... _ 16 .26 .28 .29 .30 .30 Others _ 50 2,244 2,246 P2, 258 100 cities outside New York: iash farm income: TJ. S. Gov't. obligations. 17 6.57 6.56 6.55 6.49 6.47 Totals.. 51 587 708 P738 Other securities 17 2.25 2.23 2.23 2.24 2.24 Crops s 51 183 266 P300 Commercial loans. _ 17 2.77 2.79 2.83 2.83 2.82 Livestock and products 8__ 51 379 407 P396 MONEY RATES AND SECURITY Averages of daily figures3; per cent Government payments 51 25 35 MARKETS per annum F. R. Bank discount OTHER In billions of dollars rate, N. Y 19 1.00 1.00 1.00 1.00 1.00 Central gold reserves: C ommercial paper 19 .56 .56 .56 .56 .56 United States 8 19.96 20.46 20.91 T T C U B C J J . a o o . . n r r S S S p p k . . . o o e T T T r r r a a r s r r e t ' t e e e e a a a a s c s s B A u u u c a a r e r r y a a y y p t b b b a b n o o i n o o l n n c l t n s e d e d d s s s s s 21, 2 2 1 2 2 2 1 5 9 5 1 5 2 4 2 . . . . . . 2 7 8 0 4 5 3 5 4 5 4 4 4 2 2 . . . . . . 7 2 4 0 8 5 0 0 4 4 5 0 4 2 2 . . . . . . 6 8 2 0 4 5 9 3 0 5 4 0 2 2 4 . . . . . . 4 0 6 1 5 8 8 7 2 4 4 0 4 2 2 . . . . . . 1 6 0 8 4 4 5 2 4 1 5 4 U. de N E F B S b . r t n o e — a t n g n G h d l t c e o a s o e r v n t l a a ' d l t n . . . d i s n teres _ t- _ b e _ a rin _ g . 2 2 8 8 8 0 0 £ 4 2 P 2 9 0 . . . 0 3 5 6 8 4 5 P 4 3 0 3 P 0 2 . . ) . . 1 0 2 6 9 0 7 5 P 4 3 C P 3 0 2 . 1 . . . ) 3 0 3 6 2 0 2 5 Notes _ __ 20 6.38 6.38 6.38 Wednesday figures; in unit indicated Bills 20 1.30 1.30 1.30 Special issues 20 5.15 5.23 5.31 Stock prices, total * 27, 29 78 81 80 81 82 Industrial 27 90 94 92 93 Railroad 27 25 28 26 27 Oct.- Jan.- Apr.- Public utility 27 80 82 81 81 QUARTERLY FIGURES' Dec. Mar. June Volume of trading 2 (mill, 1939 1940 1940 shares) 29 .36 .80 .42 .42 .65 Brokers' loans (mill, dollars) 29 363 390 392 404 415 In millions of dollars BUSINESS CONDITIONS Figures for week*; in unit indicated Domestic corporation security Who A F le a ll s r a m c l o e m p c r o m o m d o m u di c o t t i d s e . i s t y prices:4 3 3 3 3 7 6 7 6 . . 7 7 7 67 8 . . 6 0 7 6 7 6 . . 9 8 7 6 7 5 . . 7 7 7 6 7 5 . . 7 7 iss N R u e e e w f s, u n to d t i a n l g 2 2 2 8 8 8 5 44 1 7 4 7 2 4 5 1 5 6 1 2 3 1 3 5 1 7 5 3 3 7 0 ; Foods 33 71.4 71.6 71.3 71.1 70.8 Stee O l p th la e n r t c o o m pe m ra o t d io it n i s es- 33 82.2 82.3 82.5 82.5 82.6 Per cent per annum (per cent of capacity) 38 91.3 82.5 91.9 92.9 92.5 Customers' rates: Au (t t h o o m u o s b . i c le a rs p ) r oduction 38 27.6 39.7 63.2 78.8 96.0 N 7 ew o th Y e o r rk N C o it r y t hern and 23 1.96 2.03 2.00 El ( e m ct i r l i l c . k p w ow . h er r s p .) r oduction 39 2,601 2,463 2,639 2,629 2,670 11 E S as o t u e t r h n e r c n i ti a e n s d Western 23 2.59 2.67 2.49 Total freight-car loadings cities 23 3.32 3.35 (thous. cars) 39 768.8 695.3 804.3 813.3 822.4 p Preliminary. • Estimated. r Revised. 2 Averages of daily figures, see footnote 3. * Revised series. These figures relate to new Federal Reserve index of indus- 3 Figures are shown under the Wednesday date included in trial production on a base with the average for 1935-1939 equal to 100, presented the Weekly period. in BULLETIN for August. A revised chart will be sent upon request. Back figures < Index numbers, 1926=100. are shown in the tables on pages 980 and 982 of the September BULLETIN. Figures • Adjusted for seasonal variation. comparable with those formerly published in this table are as follows, July then 8 Points in total index of industrial production. August: industrial production 116, p. 116; manufacturing production, total 115, 1 Three-months moving average adjusted for seasonal variation. p. 116, durable 55, p. 55, nondurable 59, p. 61. 8 Series revised for the period from January 1936 to November 1 Less than $5,000,000. 1939, inclusive. Back figures may be obtained from the Division of Research and Statistics. • Banking statistics for call report dates are shown in table on following page. NOTE.—Copies of this chart book can be obtained from the Board at a price of 50 cents each. OCTOBER 1940 1137 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

STATISTICS FOR FEDERAL RESERVE CHART BOOK—BANK CALL REPORT SERIES [In billions of dollars] Chart 1937 1938 1939 1940 book Dec. Mar. June pt. Dec. Mar. June Oct. Dec. Mar. June page 31 31 29 30 2 30 26 29 7 30 BANK DEPOSITS AND CURRENCY Total deposits and currency 56.83 56.78 56.74 57.65 59.12 59.15 61.00 P63.03 P64.40 P65.05 P67.09 Deposits at all banks in U. S: Demand deposits adjusted _ 10 24.05 24.13 24.39 25.10 26.01 26.01 27.32 P29. 10 P30. 05 P30. 60 *32.01 Time deposits 10 26.26 26.34 26. 27 26.27 26.38 26.58 26.83 P26.91 P27. 00 P27. 30 P27.45 Currency outside banks 10 5.69 5.50 5.47 5.50 5.83 5.68 6.05 P6.23 P6.50 P6.30 P6.79 MEMBER BANKS Demand deposits adjusted _ __. 11 20.39 20.51 20.89 21.60 22.29 22.36 23.59 25.12 25.68 26.46 27.88 Time deposits _ 11 11.52 11.59 11.56 11.46 11.51 11.62 11.72 11.73 11.85 11.98 12.07 Interbank balances 11 5.44 5.62 6.10 6.09 6.51 6.82 7.10 *8.24 8.51 *8.72 8.85 Loans and investments 11 31.75 31.52 30.72 31.63 32.07 32.10 32.60 33.08 33.94 34.16 34.45 Investments, total ___ 11 17.79 17.98 17.78 18.69 18.86 19.05 19.46- 19.61 19.98 20.22 20.48 U. S. Government obligations, total 12 12.37 12.45 12.34 13.01 13.22 13.35 13.78 13.81 14.33 14.42 14.72 Direct obligations. 13 10.57 10.63 10.22 10.71 10.88 10.69 10.95 10.89 11.18 11.31 11.60 Guaranteed obligations... _ 13 1.80 1.83 2.13 2.30 2.34 2.66 2.83 2.92 3.14 3.11 3.12 Other securities, total _ .__ 12 5.42 5.52 5.44 5.68 5.64 5.70 5.69 5.79 5.65 5.80 5.76 State and local government securities 13 2.03 2.19 2.i3 2.30 2.45 2.55 2.55 2.76 2.69 2.90 2.89 F O o th re e i r g n d o s m ec e u s r t i i t c ies ___ 1 1 3 3 3 . . 1 2 8 1 3 . . 1 1 8 5 3 . . 1 1 8 3 3 . . 1 1 8 9 3 . . 1 0 8 1 2 . . 1 9 8 6 2 . .9 1 4 9 2 . . 1 7 9 7 8 2 . .7 1 0 7 Loan S s e , c t u B o r t i r a t o y l k l e o r a s n ' l s o , a to n t s a . l . . i2 _ _ 1 1 1 1 2 3 1 3 3 . . . 9 9 7 5 6 0 1 3 3 . .5 5 5 4 1 3 2 . . . 7 9 3 0 4 2 1 3 2 . . . 7 9 3 1 4 0 2 1 3 1 . . 9 2 .7 7 1 5 1 1 3 . . . 5 8 0 7 4 5 1 1 3 . . . 4 7 1 7 3 4 13 8 .47 1 1 3 . . . 4 7 9 9 9 6 13.94 1 1 3 . . . 1 4 9 2 5 7 Loans on securities (excluding brokers' loans) 2 13 2.75 2.67 2.61 2.59 2.78 .73 .74 .70 .67 Real estate loans... __ 12, 13 2.55 2.56 2.61 2.66 2.72 2.75 2.83 2.96 3.07 Other loans, total i2 12 7.71 7.45 7.01 6.97 2 8.74 8.73 8.85 9.51 9.79 Commercial loans 2 .._ 13 7.00 6.75 6.40 6.36 2 5.45 5.53 5.57 () 6.12 6.27 Open-market paper 13 .64 .61 .49 .48 .44 .42 .42 (*) .45 .45 Loans to banks _ 13 .07 .10 .12 .13 .12 .10 .06 (6) .06 .04 All other loans * __. 8 2.73 2.67 2.80 2.89 3.02 p Preliminary. ifln chart 12 loans to banks on securities are included in the total of "security loans" prior to June 30, 1937 and in the total of "other loans" since that date. » Figures are reported on somewhat different basis beginning December 31, 1938. For detailed explanation of the changes and for estimates on old basis as of December 31, 1938, see BULLETIN for April 1939, page 332. 8 Not originally plotted in chart book. « Partly estimated. *Detailed.breakdown of loans and investments now available on June and December dates only. SEPTEMBER CROP REPORT, BY FEDERAL RESERVE DISTRICTS [Based on estimates of the Department of Agriculture, by States, as of September 1,1940] [In thousands of units] Cotton Corn Winter wheat Spring wheat Federal Reserve district Produc- Estimate Produc- Estimate Produc- Estimate Produc- Estimate tion Sept. 1, tion Sept. 1, tion Sept. 1, tion Sept. 1, 1940 1939 1940 1939 1940 1939 1940 Bales Bales Bushels Bushels Bushels Bushels Bushels Bushels Boston 7,827 7,530 84 New York 28,310 25, 939 7,058 7,956 108 95 Philadelphia- 51,372 49,464 17,263 16,652 150 173 Cleveland 212,109 148,300 42,034 47,857 115 141 Richmond 1,341 1,554 141,280 133,038 24, 270 26, 235 Atlanta. 2,354 2,497 141, 510 174,363 5,506 6,438 Chicago... 1,132, 703 887, 578 56,639 61,135 2,044 2,236 St. Louis » 3,429 2 3,326 342,860 302, 378 57,927 62,392 97 83 Minneapolis- 285,022 242,250 25,846 25,149 157,053 187,228 Kansas City... 437 616 182,105 211,516 226, 488 203,878 4,514 6,428 Dallas. 3,631 4,127 87,166 108,034 28, 703 26,999 75 97 San Francisco.. 625 652 6,873 6,796 71, 697 71,148 27,300 31,152 Total.. 11,817 12, 772 2,619,137 2,297,186 563,431 555,839 191, 540 227, 721 Oats Tame hay Tobacco White potatoes Federal Reserve district Produc- Estimate Produc- Estimate Produc- Estimate Produc- Estimate tion Sept. 1, tion Sept. 1, tion Sept. 1, tion Sept. 1, 1939 1940 1939 1940 1939 1940 1939 1940 Bushels Bushels Tons Tons Pounds Pounds Bushels Bushels Boston 7,189 6,984 3,364 3,495 34, 764 32,476 47,632 54,722 New York 26,957 26,833 4,428 5,874 2,276 2,267 30,853 32, 376 Philadelphia- 16,503 19,108 1,944 2,373 35,967 36,183 21,638 24,273 Cleveland 43, 759 54,881 5,094 5,737 126,363 100,135 20,229 19,301 Richmond 21,103 20, 796 3,708 4,036 1,121,254 621,933 23,205 28,054 Atlanta 14, 594 15, 256 3,172 3,201 205,900 178,006 14,664 15,097 Chicago 359, 529 516,038 17,426 20,540 32, 608 34, 549 46, 211 47,396 St. Louis 46,847 61,011 7,643 7,758 282,074 228, 959 12,048 13, 329 Minneapolis.. 257,914 295,163 10,182 10, 522 2,724 3,018 44,752 49,495 Kansas City.. 76,924 123, 537 5,902 6,715 4,724 4,154 31, 219 26,872 Dallas — 31, 319 37, 658 1,430 1,637 3,349 3,813 San Francisco. 34, 577 29, 636 11, 433 12,237 68, 216 68,444 Total.... 937, 215 1, 206, 901 75, 726 84,125 1, 848, 654 1, 241, 6 364,016 383,172 1 Includes 20,000 bales grown in miscellaneous territory. 2 Includes 17,000 bales grown in miscellaneous territory. 1138 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INTERNATIONAL FINANCIAL STATISTICS PAGE Gold reserves of central banks and governments 1140 Gold production 1141 Gold movements 1141 International capital transactions of the United States 1142-1146 Central banks 1147-1150 Money rates in foreign countries 1151 Commercial banks 1151-1152 Foreign exchange rates 1153 Price movements: Wholesale prices 1154 Retail food prices and cost of living. 1155 Security prices 1155 Tables on the following pages include the principal available statistics of current significance relating to gold, international capital transactions of the United States, and financial developments abroad. The data are compiled for the most part from regularly published sources such as central and commercial bank statements and official statistical bulletins; some data are reported to the Board directly. Figures on international capital transactions of the United States are collected by the Federal Reserve Banks from banks, bankers, brokers, and dealers in the United States in accordance with the Treasury Regulation of November 12, 1934. Back figures may in most cases be obtained from earlier BULLETINS and from Annual Reports of the Board of Governors for 1937 and earlier years. Daily and monthly press releases giving daily and monthly average foreign exchange rates will be sent without charge to those wishing them. Other data on the following pages are not regularly released prior to publication. OCTOBER 1940 1139 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

GOLD RESERVES OF CENTRAL BANKS AND GOVERNMENTS [In millions of dollars] End of month Total i U S n ta i t t e e s d ? A ;i e n r n a - - g B i e u l m - Brazil I B n is r d h i i t a - g B a u r l i - a C a a d n a - Chile lo C m o b - ia C v z s a e l k o c - i h a o- m D a e r n k - Egypt France m G a e n r- y Greece 1934—Dec .. 21,123 8,238 403 590 8 275 19 134 29 19 112 60 55 5,445 32 40 1935—Dec. .. 21,704 10,125 444 611 17 275 19 189 29 16 112 54 55 4,395 33 34 1936—Dec .. 22,716 11,258 501 632 25 275 20 188 29 19 91 54 55 2,995 27 26 1937—Dec 24,045 12, 760 469 597 32 274 24 184 30 16 92 53 55 2,564 28 24 1938—Dec- 25, 544 14,512 431 581 32 274 24 192 30 24 83 53 55 2,430 29 27 1939—Aug 26,172 16,646 431 614 35 274 24 218 30 20 60 53 55 2,709 /29 28 Sept.... 25,308 16, 932 449 615 36 274 24 218 30 21 58 53 55 2,709 /29 28 Oct 25, 461 17,091 449 611 37 274 24 212 30 21 57 53 55 2,709 /29 28 Nov.... 25,672 17, 358 453 608 38 274 24 213 30 21 56 53 55 2,709 /29 28 Dec 25, 776 17, 644 466 609 40 274 24 214 30 21 56 53 55 2,709 /29 28 1940—Jan 25,983 17, 931 466 /609 41 274 24 211 30 23 56 53 55 2,709 /29 28 Feb..- 26, 274 18,177 472 /609 42 274 24 213 30 24 56 53 55 2,709 /29 28 Mar..- 25, 777 18, 433 482 /609 42 274 24 211 30 23 56 53 55 2,000 /29 28 Apr '26,020 18, 770 » 403 /609 44 274 24 212 30 23 56 53 55 2,000 /29 28 May... '26, 273 19, 209 403 /609 45 274 /24 35 30 23 56 53 2,000 /29 28 June '27,038 19, 963 403 /609 46 /274 /24 8 30 22 /56 53 /55 /2,000 /29 28 July— 27, 509 20, 463 403 /609 /46 /274 /24 • 8 30 18 /56 /53 /2,000 /29 28 Aug 27,954 20,913 403 /6D9 /46 /274 /24 8 /30 15 /53 /55 /2,000 /29 /28 End of month H ga u r n y - (P I e r r a s n ia) Italy Japan Java Mexico e N rl e a t n h d - sZe N a e la w nd N w o a r y - Peru Poland Po g r a t l u- Ru n m ia a- A So fr u ic th a Spain 1934—Dec- 23 20 518 394 77 23 575 25 61 19 96 68 104 184 740 1935— Dec 23 24 270 425 54 44 439 23 84 20 84 68 109 212 735 1936—Dec. 25 25 208 463 60 46 491 23 98 20 75 68 114 203 '718 1937—Dec .. 25 25 210 261 79 24 933 23 82 20 83 69 120 189 1938—Dec. 37 26 193 164 80 29 998 23 94 20 85 69 133 220 /52£ 1939—Aug. 24 26 /193 164 88 29 771 23 107 20 69 148 222 '525 Sept 24 26 /193 164 88 30 754 23 107 20 /84 69 149 234 /525 Oct. 24 26 /193 164 88 32 757 23 103 19 69 150 243 /525 Nov 24 26 •193 164 88 34 703 23 103 19 /84 69 151 254 /525 Dec. 24 26 144 164 90 32 692 23 94 20 69 152 249 '525 1940—jan. 24 /26 /144 164 90 27 692 23 84 20 69 152 253 Feb 24 /26 /144 164 90 23 692 23 84 20 69 153 268 /52S Mar. 24 /26 137 164 90 25 692 23 84 19 69 153 272 Apr. 24 /26 •137 164 100 27 650 23 20 69 154 279 /525 May.... 24 /26 •137 164 100 28 /650 23 /84 20 69 155 298 '525 June 24 /26 /137 164 98 31 /650 23 '84 /20 69 155 302 '525 July 24 /26 •137 164 33 /650 23 '84 /20 69 156 305 /525 Aug— /24 /26 /137 '164 102 30 /650 /23 '84 /20 /69 '156 /305 /525 Government gold reserves 1 not included in previous figures Other End of month S d w en e1 e S r w la i n tz d - T k u ey r- U K d n o i i n t m g ed - g U u r a u y - V zu e e n l e a - Y sla u v g i o a - B.I.S. t c r o ie u s n < - End of United U K n i i n t g ed - France Belmonth States dom gium 1934—Dec. 31 1934—Dec 159 627 22 1,584 82 39 53 4 161 1935—Dec 53 1 1 1 9 9 9 3 3 3 6 7 5 — — — D D D e e e c c c — - 2 2 1 4 4 8 0 4 5 4 6 6 5 5 5 6 0 7 2 2 2 4 9 6 2 2 1 , , , 6 6 5 4 8 8 8 9 4 7 7 7 7 7 4 5 5 5 9 8 2 4 4 5 3 8 1 1 8 5 1 1 1 1 8 8 6 2 4 6 1 19 9 3 3 7 6 — — D D e e c c. 31, 2 3 9 9 3 5 4 8 9 1 3 1938—Dec 321 701 29 2,690 69 52 57 14 141 1938—Mar. 1,489 June.. *44 62 1939—Aug 355 587 30 1,162 68 /52 57 9 133 Sept. 759 N D S O e e o c p c t v t 3 3 3 3 5 3 3 0 7 2 3 8 5 5 5 5 6 4 8 8 0 9 7 1 2 2 2 2 9 9 9 9 1 1 1 1 6 6 6 6 8 8 8 8 / / / / 5 5 5 5 2 2 2 2 5 5 5 5 9 9 9 9 6 7 7 5 1 1 1 1 2 5 4 5 9 3 8 3 N D O e c o c t v. 80 * 3 1 1 3 3 0 1 0 3 44 1940— J J A A F M M J u u e a u p a b n a l n r g r y y e . _ — . . - . /1 2 1 2 1 1 1 1 7 7 1 8 9 5 7 7 3 9 8 9 9 8 3 3 /4 4 4 5 5 5 5 5 8 9 8 1 3 0 2 2 8 3 8 5 6 1 7 0 /8 8 8 9 8 8 2 8 6 8 8 2 8 8 9 6 1 1 1 1 1 1 1 1 / / / 6 6 6 6 6 6 6 6 8 8 8 8 8 8 8 8 / / / / / / / / 5 5 5 5 5 5 5 5 2 2 2 2 2 2 2 2 /6 6 6 6 6 6 6 6 8 0 1 1 2 4 7 8 n 1 1 1 1 1 o 9 9 0 0 0 0 0 1 1 1 1 1 1 1 1 5 5 5 3 4 4 5 5 4 4 5 7 7 9 4 4 1 1 9 9 3 4 9 0 — — J A S F M M D j u e M e a e p n b a a n c p r . y . a r . e t r . . - . . . . . . . . . 1 1 1 1 8 6 5 5 4 5 4 4 6 5 1,732 3 4 5 4 4 5 7 6 5 8 9 7 5 5 1 1 1 7 7 p Preliminary. r Revised. i Reported at infrequent intervals or on de- / Figure carried forward from last previous official report, as indicated by last previous layed basis: U. S.—Exchange Stabilization Fund figure without footnote ', except in the case of Spain, Germany, Venezuela, and Poland; Spanish (Special A/c No. 1); U. K.—Exchange Equalizafigures officially reported on Aug. 1,1936 and April 30,1938, last official German report dated June tion Account; France—Exchange Stabilization 15,1939, last Venezuelan report is for end of March 1939, and last Polish report dated July 31,1939. Fund and Rentes Fund; Belgium—Treasury. i Totals do not include Government gold reserves shown in separate section at end of table, 2 Figure for Mar. 1937, first date reported. or other central reserves which are unreported or which are too minor to be included. Among 3 Figure for Sept. 1937. unreported reserves are those of the U. S. S. R., those in the Canadian, Swiss, and Netherlands * First date reported. stabilization funds, and certain German holdings. Totals may include some figures which are NOTE.—For details regarding special gold preliminary or carried forward from previous report dates (see footnote f). transfers in 1939-40 between the British E. E. A. M ' ' * » O Be n g M inn a i y n g 1 , A 19 p 4 r 0 il , 1 g 9 o 4 ld 0 , b r e e l p o o n r g ts i n o g n t o ce B rt a a n in k A of rg C e a n n ti a n d e a g t o r l a d n s r f e e s r e r r e v d e s t o n o F l o o r n e g ig e n r a E v x a c i h la a b n l g e e . Con- a F n re d n c th h e E B . a S n . k F . o f a n E d n g th la e n B d, a n a k n d o f b e F t r w an ee ce n , t s h e e e trol Board. BULLETIN for September 1940, p. 926. * These countries are: Albania, Algeria, Australia, Austria through Mar. 7, 1938, Belgian Congo, Bolivia, China, Danzig through Aug. 31, 1939, Ecuador, El Salvador, Estonia, Guatemala, Finland, Latvia, Lithuania, Morocco, and Thailand (Siam). Figures for certain of these countries have been carried forward from latest report date (see footnote f). NOTE.—For description of table and back figures see BULLETIN for September 1940, pp. 925- 934 and pp. 1000-1007; details regarding special internal gold transfers affecting the reported figures through April 1940 appear on p. 926 in that issue. 1140 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

GOLD PRODUCTION Outside U. S. S. R. [In thousands of dollars] Estimated Production reported monthly world produc- Africa North and South America Other Year or month tion outside Total South Rho- West Belgian Canada Mexico Cbtm" Cnile Austra- British U.S.S.R. Africa desia Africa Congo lia India $1=25-8110 grains of gold 9/10 fine; i. e., an ounce of fine gold=$20.67 1929.. 382, 532 352,237 215, 242 11,607 4,297 2,390 45,651 39,862 13,463 2,823 683 8,712 7,508 1930.. 401,088 365, 258 221, 526 11,476 4,995 2,699 47,248 43,454 13,813 3,281 428 9,553 6,785 1931.. 426,424 386,293 224,863 11,193 5,524 3,224 49, 527 55,687 12,866 4,016 442 12,134 6,815 1932.. 458,102 413,459 238,931 12,000 5,992 3,642 50,626 62,933 12,070 5,132 788 14, 563 6.782 1933__ 469, 257 411, 208 227,673 13,335 6,623 3,631 52,842 60,968 13,169 6,165 3,009 16,873 6,919 $1=15-5/21 grains of gold 9/10 fine; i. e., an ounce of fine gold=$S5 1933__ 794,498 696, 218 385,474 22, 578 11,214 6,148 89,467 103, 224 22,297 10,438 11,715 1934._ 823,003 707, 288 366, 795 24,264 12,153 6,549 108,191 104,023 23,135 12,045 11,223 1935._ 882, 533 751,979 377,090 25,477 13, 625 7,159 126,325 114,971 23,858 11, 515 11,468 1936.. 971, 514 396,768 28,053 16,295 7,386 152, 509 131,181 26,465 13,632 11,663 1937- 1,041,576 892, 535 410, 710 28,296 20,784 8,018 168,159 143, 367 29,591 15,478 11,607 1938.. 1,132,856 957,212 425,649 28, 532 24,670 8,470 178,143 165,379 32,306 18, 225 11,284 1939.- 1, 206,1261,019,569 448,753 28,009 '28, 538 8,759 196, 391 178,303 32,300 19,951 11,008 1939—May. „ 98, 581 '83, 557 37, 970 2, 355 '2,333 779 15, 319 15,108 1,794 1,614 June 99, 563 '83,700 37,065 2,369 '2, 288 756 14,611 15,279 3,216 1,551 910 July 102,878 '87, 241 37,952 2,395 2,395 739 16,250 15,397 3,638 1,551 936 August 107,357 '91, 520 38,494 2,431 2,379 731 16,947 15, 732 6,519 1,735 923 September.. 106,990 '90,057 37,817 2,442 2,432 705 19, 728 14, 784 2,302 1,803 888 October 107,244 '90,999 38,459 2,452 2,479 715 21, 785 15,158 1,832 1,677 934 November.. 103,675 '87, 525 38, 600 2,425 2,497 686 17, 512 14,875 2,333 1,873 903 December.. 101,438 '85,102 38,534 2,330 2,589 709 15,936 15,209 1,209 1,367 925 194&—January... c104,636 88, 793 39,777 2,384 2,662 739 16,972 14,853 3,078 1,958 993 891 February.. 97,605 81,362 38,575 2,345 2,663 728 13,317 14,188 1,901 1,633 735 March 104,067 88,075 40,162 2,372 2,740 732 16,217 15,045 1,651 1,717 1,759 April P106, 974 P90, 325 40,879 2,454 2,678 P732 16,408 14, 652 4,233 1,941 766 May P106,597 *>89,842 41, 742 P2,450 2,747 P767 16, 500 15,488 Pl, 365 1,825 1,271 P860 June. P104, 233 P87, 515 40,437 P% 415 2,643 P732 14,862 15,795 92, 555 1,715 780 P860 July *109, 959 P93,240 41,936 P2,450 P2,643 18,866 15,982 P2, 555 Pl, 715 P780 P860 Qold production in U. S. S. R.: No regular Government statistics on gold production in U. S. S. R. are available, but data of percentage changes irregularly giveenn oouutt bbyy ooffffiicciiaallss ooff tthhee ggoolldd mmiinniinngg iinndduussttrryy,, ttooggeetthheerr wwiitthh cceerrttaaiinn ddiirreecctt ffiigguurreess ffoorr ppaa st' years, af«for-d a, b.as..i s for es.ti.m..ating annual production as follows—at $20.67 per fine ounce: 1929, $15,000,000; 1930, $31,000,000; 1931, $34,000,000; 1932, $40,000,000; 1933, $56,000,000; at $85 per fine •unce: 1933, $95,000,000; 1934, $135,000,000; 1935, $158,000,000; 1936, $185,000,000; 1937, $180,000,000; 1938 (preliminary), $184,000,000. 9 Preliminary. ' Revised. c Corrected. 1 Includes Philippine Islands production received in United States. NOTE.—For monthly figures back to January 1929 and for explanation of table see BULLETIN for March 1939, p. 227; February 1939, p. 151; June 1938, pp. 539-540; and April 1933, pp. 233-35. For annual figures of world production back to 1873 (including Russia-U. S. S. R.), see Annual Report of Director of Mint for 1939, p. 106; and 1936, pp. 108-109. Figures for Canada beginning January 1940 are subject to official revision. GOLD MOVEMENTS UNITED STATES [In thousands of dollars at approximately $35 a fine ounce] Total Net imports from or net exports (—) to: net Y m e o a n r th or i e m o x r p p o n o r e r t t t s s U K d n i o i n m t g e - d France g B iu el m - N la e e n r t d - h s - S d w en e- S l w a e n r i - t d z- C a a d n a - M ic e o x- Co b l i o a m- I P s p h la i i n l n i e d p s - t A ra u l s i - a A So fr u ic th a Japan B In ri d ti i s a h c o t o A r th i u e l e n l s r - 1934i 1,131,994 499,870 260,223 8,902 94,348 12,402 30,270 16,944 12,038 1, 12 76,820 32,304 1935 1,739,019 315, 727934,243 3 227,185 968 95,171 13,667 10,899 15,335 3,498 65 75,268 46,989 1936 1,116,584 174,093 573,671 3,351 71,006 2 7,511 72,648 39,966 11,911 21, 513 23,280 8 77,892 39,735 1937 1,585,503 891, 531-13,710 90,859 6,461 6 64,452 111, 48038,482 18,397 25,427 34,713 181 246,464 50,762 29,998 1938 1,973, 5691,208,728 81,135 15,488 163; 049 60,146 1,363 76,315 36,472 10, 557 27,880 39,162 401 168, 740 16,159 > 67,975 1939 3,574,1511,826,403 3, 798 165; 122 341,618 28,715 86,987 612,949 33,610 23,239 35,636 74,250 22,862 165,605 50,956 s 102,404 1939 June 240,430 128,196 55,081 5,644 17,191 3,280 2,107 3,843 5,677 50 14,093 2,244 3,023 July 278,636 177,805 45,554 5,628 15,196 4,150 2,123 3,022 5,034 50 10,938 2,760 6,365 Aug 259,921 163,738 22,640 34,299 3,956 2,120 2,775 52 10,931 9,259 4,460 Sept 326,074 162,450 1,482 120,837 653 2,102 3,947 5,474 11 16,425 4,065 •8,541 Oct 69, 726 10,182 2,990 9,940 1,794 3,188 8,420 2,142 12,497 2,703 » 15,870 Nov 167,980 18, 556 28 8,781 5.,113 2,990 65,067 3,445 2,117 2, 643 12, 505 10,449 9,487 10,138 16, 662 Dec 451,172 10,417 31, 526 19, 743 5,119 308,773 3,972 2,116 2,646 6,472 9,885 20,101 7,592• 22,812 1940 Jan _. 236,391 23,906 30,415 16,601 52, 716 2,550 3,360 6,155 20,297 37,680 9,743» 31,698 Feb. 201,422 21,321 974 16,18132,448 » 46,866 2,006 1,896 4,241 18,872 4,919 6,7228 31,001 Mar 459,827 35,268 282 65,991 13,931 249,858 2,215 2,116 4,137 7,409 24, 503 5,797 11,813 » 21,493 Apr 249,851 43, 567 3,273 39,654 28,907 54,967 2,396 2,111 3,376 3,374 28, 798 4,710 3,139io 27,866 May 435,132 62,042 40 9,431 32,617 281,182 2,331 2,113 2,405 5,177 31,477 4,743 4,317" 18,423 June 1,162,975 128,003 241,603 3,671 11,452 716,685 4,182 2,130 6,603 23,091 3,399 2,377 25,197 July 519, 974 301,734 3,158 2,138 172, 268 1,891 5,856 2,830 5,262 3,482 August. __ 351, 553 10,819 3,637 264,328 10,335 4,516 3,738 6, 746 11,687 954 H 34,789 ' Revised. i Differs from official customhouse figures in which imports and exports for January 1934 are valued at approximately $20.67 a fine ounce. > Includes $31,830,000 from Argentina. »Includes $28,097,000 from China and Hong Kong; $15,719,000 from Italy; $10,953,000 from Norway; $10,077,000 from Chile. • Includes $5,157,000 from Hong Kong. «Includes $6,363,000 from Italy; $4,087,000 from Hong Kong. • Includes $6,414,000 from Norway; $5,586,000 from Italy. i Includes $19,527,000 from Norway; $5,452,000 from Hong Kong. • Includes $13,878,000 from Norway; $5,570,000 from U. S. S. R.; $5,566,000 from Italy. »Includes $11,760,000 from Italy. » Includes $16,108,000 from Italy; $5,984,000 from Hungary. " Includes $8,248,000 from Italy. » Includes $13,673,000 from Yugoslavia, is Includes $6,608,000 from Portugal; $6,307,000 from Brazil. 14 Includes $17,386,000 from Portugal; $6,377,000 from Netherlands Indies. NOTE.—For gross import and export figures and for additional countries see table on p. 1110. OCTOBER 1940 1141 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INTERNATIONAL CAPITAL TRANSACTIONS OF THE UNITED STATES NET CAPITAL MOVEMENT TO UNITED STATES SINCE JANUARY 2, 1935 [In millions of dollars. Minus sign indicates net movement from United States] TABLE 1.—TOTAL CAPITAL MOVEMENT Increase in foreign banking funds in U. S. Decrease Foreign Domestic in U. S. securities: securities: Inflow in From Jan. 2,1935, through- Total Central b f a u n n k d in s g o R f e U tu . r S n . In fo fl r o e w ig n of b b r a o l k a e n r c a e g s e Total f b u a n n d k s Other abroad funds funds in N. Y.i 1935—Dec. 31 1.412.5 9.8 593.5 361.4 125.2 316.7 6.0 1936—Dec. 30 2,608.4 930.5 81.1 849.4 431.5 316.2 917.4 12.9 1937—Dec. 29 3.410.3 1.168.5 243.9 924.6 449.1 583.2 1.162.0 47.5 1938—Mar. 30 3, 207. 2 949.8 149.9 799.9 434.4 618.5 1,150. 4 54.2 June 29. 3.045.8 786.2 125.9 c660.4 403.3 643.1 1,155. 3 57.8 Sept. 28 3,452. 9 1,161. 2 168.0 993. 2 477.2 625.0 1,125. 4 64.1 Dec. 28 3, 779. 2 1,432. 7 216.3 1,216. 5 478.1 610.0 1,210. 9 47.6 1939—Mar. 29 4.134.7 1.693.0 256.8 1,436. 2 550.5 646.7 1,180. 6 June 7 4,550.0 2,008. 2 327.8 1,680. 4 601.3 658.4 1,210.6 71.6 June 14 4.555.9 2,019.8 364.4 1,655. 5 593.7 661.5 1.208.3 72.6 June 21 4, 584. 2 2,031.7 364.5 1,667. 3 608.7 664.3 1.205.6 73.8 June 28 4.593.6 2,048.3 361.8 1, 686. 5 607.5 664.5 1,199. 3 74.0 July 5 4,611. 6 2,049.7 306.9 1,742.9 608.0 678.5 1,199.3 76.1 July 12 4,588.9 2,031.2 293.6 1,737. 5 607.9 677.1 1.194.4 78.4 July 19 4.591.0 2,042. 5 288.6 1,753.9 604.5 677.0 1.185.0 81.9 July 26 4,613.4 2,066.2 301.2 1,765.0 606.9 678.0 1,180.0 82.3 Aug. 2 4.635.1 2,093.9 327 1 1,766.8 596.8 680.2 1.182.2 82.1 Aug. 9 4.662.7 2.139.1 323.2 1,815.8 609.9 652.8 1,176. 5 84.5 Aug. 16 4.709.8 2,182. 2 305.5 1,876.7 622.8 654.5 1,164.9 85.4 Aug. 23 4.827.9 2,287.3 352.5 1,934.9 633.0 656.9 1.165.1 85.5 Aug. 30 4,863.3 2.334.2 371.6 1,962.6 620.6 657.8 85.0 1.165.7 Sept. 6 4,882.3 2,341. 5 409.0 1,932. 5 623.5 661.7 1.171.3 84.2 Sept. 13 4,940.3 2.389.3 464.7 1,924.6 621.7 668.9 1.181.3 79.2 Sept. 20 4,976.0 2.434.6 610.7 1,923.9 612.5 674.4 1.173.4 81.1 Sept. 27 4.955.4 2.412.4 485.1 1,927.3 618.4 676.9 1,164.4 83.1 Oct. 4_ 4.896.8 2,386.5 483.6 1,902.9 594.6 684.6 1.150.2 80.9 Oct. 11 4,872.8 2,370. 6 462.8 1,907. 7 598.1 685.2 1,144. 4 74.6 Oct. 18 4,871. 2 2,360. 6 441.6 1,919.0 601.7 686.7 1,141. 7 80.5 Oct. 25 4,882.0 2,384.7 442.9 1,941. 9 601.0 687.3 1,130. 6 78.5 Nov. 1 4,858. 6 2,366.9 494.8 1,872.0 599.6 688.7 1,123. 7 79.8 Nov. 8 4.825.0 2,341.6 490.3 1,851. 3 597.3 690.4 1,115. 9 79.9 Nov. 15 4,862. 7 2,362.4 481.6 1,880.8 618.8 693.2 1,109. 2 79.2 Nov. 22 4,822. 9 2,329. 3 433.9 1,895 3 615.3 694.3 1,107.1 76.9 Nov. 29 4,875.6 2, 377.4 435.9 1,941. 5 622.0 695.4 1,103. 7 77.1 Dec. 6 4.867.6 2,366.9 430.9 1,936.1 626.8 699.0 1,098. 9 75.9 Dec. 13 4,860.0 2,366. 6 413.3 1,953.3 619.7 700.7 1.096. 5 76.5 Dec. 20 4.904.8 2,398. 5 441.0 1,957. 5 619.6 711.8 1,096.8 78.1 Dec. 27 4,893.0 2, 383. 5 430.0 1,953. 5 612.8 720.1 1,098. 5 78.1 1940—Jan. 3 4, 881.1 2,321.8 433.5 1,888. 3 650.4 725.7 1,102. 6 80.6 Jan.10 4,920.4 2,360.2 445.2 1,915.0 644.5 731.7 1,102. 3 81.7 Jan.17 4,922. 6 2, 368. 4 435.2 1,933.2 636.1 733.7 1,100.6 83.8 Jan. 24 4, 943.1 2,384.2 456.1 1, 928. 2 640.1 736.1 1.099.0 83.6 Jan. 31 4.918.9 2,368. 5 449.6 1,918.9 626.1 738.0 1.098.1 88.2 Feb. 7 4, 912.3 2,363.4 427.8 1,935. 6 623.3 741.0 1.097. 4 87.3 Feb. 14 4.930.1 2, 380. 8 452.0 1,928. 7 621.5 743.3 1.097.8 86.7 Feb. 21 4, 902.8 2,343.1 409.9 1,933. 3 627.0 745.5 1.099.1 88.1 Feb. 28 4.930.7 2, 365. 4 432.9 1,932. 5 627.7 748.7 1,102. 0 87.0 Mar. 6 4, 906. 5 2,323. 7 395.3 1,928.4 638.5 752.4 1,103.4 88.4 Mar. 13 4,928. 8 2, 348.0 404.3 1,943. 8 633.5 755.2 1.102.2 89.9 Mar. 20 4,973. 4 2,386. 6 423.8 1,962.8 638.7 757.2 1,100.6 90.2 Mar. 27.—. 4,989.6 2,409. 6 431.2 1,978.4 636.9 758.1 1,097.8 87.3 Apr. 3 5.002.8 2,426.0 426.1 1,999.9 631.6 761.6 1.094. 8 88.7 Apr. 10 4.988.2 2, 407. 7 414.4 1,993.3 634.1 762.4 1.095. 5 88.6 Apr. 17 5,022. 6 2, 425. 2 419.4 2,005. 8 644.9 764.7 1,098.4 89.4 Apr. 24 5.064.9 2,453. 5 409.0 2,044. 5 659.0 767.2 1.096. 9 88.2 May 1 5,049. 3 2,449.4 2,050. 9 643.4 771.1 1.097.0 May 8 5,058.2 2,453. 7 404.1 2,049. 7 647.0 773.2 1.095. 7 88.5 May 15 5,065. 3 2,448.4 444.5 2,003.9 657.3 774.8 1.096. 8 88.0 May 22 5,123.9 2, 500. 3 499.7 2,000. 6 664.1 774.9 1,090. 3 94.2 May 29 5,076. 4 2,440. 2 487.5 1,952. 7 684.0 775.6 1,081. 5 95.1 June 5 5,110. 5 2, 461. 2 511.3 1, 949.8 679.1 778.9 1.094.1 97.2 June 12 5,076.9 2, 427. 9 511.2 1, 916. 7 674.5 780.4 1.097. 2 96.9 June 19 5, 284. 4 2,628.0 722.9 1, 905.1 681.2 782.1 1,094. 6 98.5 June 26 5, 280. 4 2, 617. 7 726.7 1,891.0 690.0 782.6 1,092.4 97.6 July 3 5, 377. 3 2, 716. 6 1,907. 8 684.1 785.7 1,092.0 e Corrected. i Including funds in accounts transferred from central bank to government names; for original explanation of funds included under this heading see BULLETIN for April 1939, p. 285. NOTE.—Statistics reported by banks, bankers, brokers, and dealer • For back figures and description of the statistics, see BULLETIN for April 1939, pp. 284-296; April 1938, pp. 267-277; and May 1937, pp. 391-131. 1142 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INTERNATIONAL CAPITAL TRANSACTIONS OF THE UNITED STATES NET CAPITAL MOVEMENT TO THE UNITED STATES SINCE JANUARY 2,1935—Continued [In millions of dollars. Minus sign indicates net movement from United States] TABLE 2.—TOTAL CAPITAL MOVEMENT, BY COUNTRIES From th r J o a u n g . h 2 — , 1935, Total U K d n i o i n m t g ed - France N la e e n r t d - h s - Sw la i n tz d er- m G a e n r y - Italy E O u t r h o e p r e E T u o ro ta p l e Canada A L m a e t r i i n ca Asiai ot A he ll r * 1935—Dec. 31 1,412. 5 554.9 210.2 114.5 130.4 36.6 24.0 130.0 1,200.6 (a) 70.9 128.3 12.7 1936—Dec. 30 2,608.4 829.3 299.5 229.7 335.5 83.1 45.6 228.5 2,051.3 150.5 201.2 184.0 21.4 1937—Dec. 29 . 3,410.3 993.7 281.7 311.9 607.5 123.9 22.1 312.2 2,653.0 106.3 410.6 224.6 15.9 1938—Dec. 28 3,779.2 1,186.1 339.5 324.6 554.0 140.7 33.0 463.8 3,041.7 157.2 389.5 156.8 34.1 1939—Sept. 27 4,955.4 1,368.1 459.6 448.4 671.1 151.1 32.9 686.0 3,817.2 260.9 528.0 276.4 72.9 Oct. 25 _. 4,882.0 1,301.4 430.9 446.8 686.5 159.1 48.0 710.3 3,783.1 239.0 522.2 260.2 77.5 Nov. 29 4,875.6 1,157.2 453.1 457.8 719.1 162.9 55.8 725.3 3,731.2 263.2 504.0 287.3 89.9 Dec. 27 4,893.0 1,117.3 442.3 469.9 759.1 163.3 55.9 753.8 3,761.5 229.2 505.9 299.4 96.9 1940—Jan. 31 4,918 9 1,029.1 471.2 466.1 798.3 166.3 61.7 811.2 3,803.9 227.8 503.9 297.3 86.1 Feb. 28 4,930. 7 1,006. 2 468.1 469.0 826.3 166.0 60.7 838.0 3,834.4 225.4 507.7 285.7 77.5 Mar. 27 4,989. 6 961.6 462.9 466.0 855.4 167.3 68.5 863.6 3,845. 2 232.2 527.1 315.2 69.9 Apr. 24 5,064.9 964.5 468.9 486.4 879.8 166.9 87.7 859.5 3, 913. 7 219.4 535.2 325.7 70.8 May 29 5,076.4 975.7 494.8 471.9 851.3 171.5 78.3 874.1 3, 917. 7 215.9 558.4 311.9 72.6 June 5 5,110. 5 978.9 495.3 471.4 870.4 171.2 71.1 867.0 3,925. 5 212.6 567.8 325.8 78.9 June 12 5,076.9 990.4 468.6 463.8 864.8 171.4 62.8 867.4 3,889. 2 214.9 561.4 333.0 78.3 June 19 5, 284.4 986.0 680.2 464.8 864.6 171.4 64.9 861.2 4,093.1 210.4 572.0 331.3 77.6 June 26 .. 5, 280.4 981.6 663.9 463.8 868.5 170.7 63.3 866.2 4,078.1 217.6 565.5 342.8 76.3 July 3 __ 5,377.3 1,013.1 681.4 459.6 876.8 171.4 66.3 885.3 4,153. 9 230.2 579.2 338.4 75.7 TABLE 3.—FOREIGN BANKING FUNDS IN UNITED STATES, BY COUNTRIES From th J r a o n u . g 2 h , - 1935, Total U K d n o i i n m t g e - d France N la e e n r t d - h s - Sw la i n tz d er- m G a e n r y - Italy E O u t r h o e p r e E T u o ro ta p l e Canada A L m a e t r i i n ca Asia* ot A he ll r * 1935—Dec. 31. 603.3 128.6 129.6 55.7 72.4 -.8 7.3 60.7 453.5 46.0 33.5 58.8 11.6 1936-Dec. 30. 930.5 163.5 144.2 65.9 109.8 2.7 23.0 79.7 588.9 86.8 149.3 90.4 15.2 1937—Dec. 29. 1,168.5 189.3 111.8 76.3 288.4 9.6 6.9 109.4 791.7 76.3 166.3 126.2 8.0 1938—Dec. 28. 1,432.7 366.7 158.8 84.4 203.7 -9.8 3.8 203.0 1,010.6 135.1 134.0 132.7 20.4 1939—Sept. 27. 2.412.4 584.5 172.0 -21.9 -1.6 399.5 1,682.5 225.2 262.0 188.5 54.3 Oct. 25_. 2,384.7 558.5 227.8 172.0 293.8 -20.0 12.8 428.7 1,673.5 209.0 258.1 186.4 57.6 Nov. 29. 2,377. 4 429.4 244.1 180.7 320.4 -18.4 16.7 446.9 1.620.0 227.4 240.0 218.5 71.4 Dec. 27. 2.383.5 396.2 231.6 190.8 352.0 -22.2 16.7 473.1 1,638.2 185.0 243.6 238.9 77.8 1940—Jan. 31_. 2,368.5 332.3 258.5 186.3 381.8 -20.5 24.9 522.1 1,685.4 166.8 231.2 226.2 68.0 Feb. 28. 2,365.4 304.4 256.4 186.2 397.3 -21.2 25.7 546.6 1,695. 4 168.5 233.6 217.4 50.4 Mar. 27. 2,409. 6 271.2 252.9 184.6 418.0 -20.5 35.5 570.9 1, 712. 5 173.1 251.0 230.4 42.6 Apr. 24. 2,453. 5 271.5 259.0 200.5 434.6 -21.5 54.5 562.5 1.761.1 148.5 264.6 236.4 42.9 May 29. 2,440. 2 282.4 287.0 184.4 399.9 -19.7 46.2 572.4 1, 752. 6 135.8 281.5 223.6 46.6 June 5___ 2, 461. 2 286.2 287.6 183.8 418.5 -19.4 24.4 564.9 1, 746.0 135.0 288.7 238.5 53.0 June 12_. 2, 427. 9 301.1 260.8 175.7 412.9 -19.1 13.9 564.0 1, 709. 3 139.9 283.3 242.9 52.4 June 19.. 2, 628.0 298.0 471.3 176.4 412.7 -19.3 13.7 557.8 1,910. 6 135.4 291.8 238.7 51.4 June 26_. 2,617. 7 295.2 455.3 175.4 418.6 -20.1 10.1 562.0 1,896. 4 143.1 289.4 238.5 50.3 July 3— 2, 716. 6 325.8 472.7 170.8 427.4 -19.9 11.0 578.8 1, 966. 6 159.0 300.5 242.2 48.3 TABLE 4.—UNITED STATES BANKING FUNDS ABROAD, BY COUNTRIES From th r J o a u n g . h 2 — ,1935, Total U K d n i o i n m t g e - d France N la e e n r t d - h s - Sw la i n tz d er- m G a e n r y - Italy E O u t r h o e p r e E T u o ro ta p l e Canada A L m a e t r i i n ca Asia* ot A he ll r * 1935—Dec. 31 361.4 208.8 48.1 -.4 1.6 29.7 13.7 8.8 310.2 -4.6 20.1 37.3 -1.6 1936—Dec. 30 _ 431.5 178.0 62.0 -3.3 2.7 66.0 16.3 22.0 343.7 36.9 24.9 30.4 -4.4 1937—Dec. 29 449.1 207.4 65.. 3 -4.4 2.6 105.1 6.5 26.9 409.3 -21.7 51.6 18.7 -8.7 1938—Dec. 28 478.1 204.5 65.5 -6.9 2.6 140.3 13.9 33.0 453.0 30.6 66.8 -65.0 -7.2 1939—Sept. 27 618.4 226.1 70.0 9.1 5.2 164.1 15.1 38.2 527.7 46.6 57.4 -6.4 -6.9 Oct. 25 601.0 227.7 70.2 9.3 4.2 170.5 15.4 31.3 528.6 45.2 54.0 -20.0 -6.7 Nov. 29 622.0 245.6 73.3 12.0 3.4 172.7 17.8 27.8 552.6 52.7 52.0 -26.7 -8.6 Dec. 27 612.8 247.8 73.8 12.0 3.1 177.2 16.3 26.8 557.0 50.0 48.5 -34.3 -8.4 1940—Jan. 31 626.1 236.0 73.5 11.4 3.0 178.9 13.5 30.3 546.7 56.2 55.8 -32.0 -.6 Feb. 28 627.7 247.4 73.4 12.9 2.6 179.4 11.7 30.5 557.8 52.1 56.2 -37.7 -.7 Mar. 27 636.9 245.1 72.9 9.8 1.7 180.3 10.0 30.4 550.2 53.6 56.5 -22.8 -.6 Apr. 24 659.0 255.4 73.0 13.1 1.6 181.0 10.3 31.6 566.0 60.2 53.0 -20.0 -.2 May 29 684.0 262.0 70.8 15.4 3.1 183.8 8.9 35.2 579.3 69.5 52.6 -16.9 -.5 June 5 679.1 263.2 70.9 15.4 3.5 183.2 10.3 35.4 581.8 64.2 52.6 -18.8 -.6 June 12 674.5 260.5 71.3 15.7 3.8 183.2 8.5 36.3 579.2 60.6 52.5 -17.1 -.7 June 19_ 681.2 259.9 73.1 15.8 3.9 183.3 10.2 35.9 582.1 65.4 53.0 -18.7 -.6 June 26 690.0 259.0 72.9 15.8 4.0 183.4 12.3 36.6 583.9 66.7 47.4 -7.4 -.6 July 3— 684.1 260.1 72.6 16.0 4.3 183.9 13.0 38.8 588.6 61.0 49.0 -15.3 .8 1 Prior to Jan. 3, 1940, the figures shown under Asia represent the Far East only, the remaining Asiatic countries being included under "All other". 2 Inflow less than $50,000. NOTE.—Statistics reported by banks, bankers, brokers, and dealers. For back figures and description of the statistics, see BULLETIN for,April 1939, pp. 284-296; April 1938, pp. 267-277; and May 1937, pp. 394-431. OCTOBER 1940 1143 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INTERNATIONAL CAPITAL TRANSACTIONS OF THE UNITED STATES NET CAPITAL MOVEMENT TO THE UNITED STATES SINCE JANUARY 2,1935—Continued [In millions of dollars. Minus sign indicates net movement from United States] TABLE 5.—FOREIGN SECURITIES, BY COUNTRIES Net Purchases by Foreigners From th r J o a u n g . h 2 — , 1935, Total U K d n o i i n m t g ed - France N la e e n r t d - h s - S la w e n r i - d tz- m G a e n r- y Italy E O u t r h o e p r e E T u o ro ta p l e Canada A L m a e t r i i n ca Asia* ot A he ll r * 1935—Dec. 31 125.2 67.8 6.8 7.4 —1.2 13.3 2.9 46.1 143.1 -39.7 12.7 7.9 1.1 1936—Dec. 30 316.2 116.1 18.2 10.4 13.7 22.5 9.4 87.9 278.3 1.7 15.7 17.0 3.5 1937—Dec. 29 ._ 583.2 136.8 22.8 21.2 30.4 26.6 13.5 115.2 366.4 10.5 175.0 24.5 6.8 1938—Dec. 28 610.0 129.1 26.2 27.3 37.1 33.1 20.5 165.9 439.1 —38.9 166.3 33.8 0.7 1939_Sept. 27 676.9 124.9 33.8 29.7 43.4 36.4 24.8 183.1 476.0 -29.5 180.4 39.3 10.7 Oct. 25 687.3 124.8 41.1 29.4 43.3 36.4 24.9 185.0 485.0 -29.7 181.1 39.8 11.1 Nov. 29 695.4 124.3 41.7 29.2 43.3 36.5 26.1 186.5 487.6 —26.7 182.3 40.8 11.4 Dec. 27 720.1 125.6 42.1 29.4 44.8 36.6 27.6 188.6 494.6 -11.5 183.0 42.8 11.8 1940—Jan. 31 738.0 126.2 42.5 29.6 46.0 36.5 27.8 190.6 499.1 -.2 184.5 43.2 11.3 Feb. 28 748.7 129.0 42.6 30.2 47.7 36.4 27.9 191.7 505.5 1.7 185.6 44.2 11.6 Mar. 27 758.1 130.7 42.7 31.4 48.8 36.3 27.7 192.7 510.3 4.0 186.8 45.2 11.7 Apr. 24 767.2 131.6 42.7 31.2 49.8 36.2 27.5 194.0 513.1 8.4 188.2 45.6 12.1 May 29 775.6 132.4 42.8 31.0 49.0 36.2 27.8 194.5 513.7 12.6 190.6 46.2 12.4 June 5 778.9 132.3 42.9 31.0 48.9 36.2 27.8 194.6 513.7 15.3 191.2 46.3 12.5 June 12 780.4 132.3 42.9 31.0 48.9 36.2 27.9 194.7 513.8 15.8 191.8 46.4 12.5 June 19 782.1 132.0 42.9 31.0 49.0 36.2 27.9 194.7 513.6 16.0 192.3 47.5 12.6 June 26 782.6 131.9 42.9 31.0 48.8 36.2 28.0 194.8 513.5 16.0 192.7 47.7 12.6 July 3 _ 785.7 131.8 42.9 31.0 48.8 36.2 28.0 194.8 513.5 17.6 194.3 47.7 12.6 TABLE 6.—DOMESTIC SECURITIES, BY COUNTRIES Net Purchases by Foreigners From t h J r a o n u . g 2 h— , 1935, Total U K d n o in i m t g e - d France N la e e n r t d - h s - S l w a e n i r t d z- m G a e n r- y Italy E O u t r h o e p r e E T u o ro ta p l e Canada A L m a e t r i i n ca Asia* ot A he ll r i 1935—Dec. 31 316.7 149.8 23.4 50.5 55.1 -5.4 —.1 12.9 286.2 2.8 3.7 21.4 2.6 1936—Dec. 30 917.4 367.7 64.7 157.6 200.2 -7.5 -3.3 38.5 818.0 32.6 15.5 44.1 7.1 1937—Dec. 29 1,162.0 448.7 70.3 213.8 275.3 —17.4 —4.9 55.7 1,041.6 37.6 18.2 C4.7 0.8 1938—Dec. 28 1,210.9 472.6 76.5 212.9 301.7 -22.7 -5.4 56.6 1,092.3 27.8 23.4 56.4 11.0 1939—Sept. 27 1,164.4 408.4 73.7 228.2 320.9 -27.4 -5.5 58.3 1,056.7 8.9 26.1 68.5 14.1 Oct. 25 1,130.6 369.8 72.9 227.0 329.1 —27.6 —5.4 59.4 1,025.1 5.3 27.0 59.2 13.0 Nov. 29 1,103. 7 338.2 74.9 226.2 336.3 -28.0 -4.9 59.1 1,001.8 .7 28.6 68.7 13.8 Dec. 27 1,098.5 328.2 76.3 227.1 342.8 -28.2 -4.9 60.1 1,001.4 -3.1 29.8 56.1 14.8 1940—Jan. 31 1,098.1 315.7 77.1 229.4 349.2 -28.3 -4.7 62.4 1,000.8 -5.9 30.6 68.2 14.5 Feb. 28 1,102.0 306.5 76.8 230.4 359.7 -28.4 -4.7 63.4 1,003.8 —7.5 31.5 59.8 14.4 Mar. 27 1,097.8 295.6 75.7 231.2 367.2 -28.7 -4.9 64.2 1,000.4 -8.0 31.6 59.5 14.4 Apr. 24 1,096.9 287.5 76.3 231.4 372.6 —28.7 -4.9 65.7 999.9 —8.0 29.5 61.2 14.3 May 29 1,081. 5 281.3 75.8 230.7 380.9 -28.7 -4.7 64.8 1,000. 0 -12.4 27.3 53.3 13.4 June 5 1,094 1 281.0 75.5 230.6 380.9 -28.7 8.5 64.5 1,012. 3 — 12.3 27.0 53.9 13.3 June 12 1,097. 2 280.2 75.3 230.5 380.5 -28.7 12.4 64.8 1,015.0 -13.0 27.1 54.6 13.3 June 19 1,094. 6 279.7 74.7 230.5 380.4 -28.7 12.9 64.8 1,014.2 -18.0 27.2 57.7 13.4 June 26 1,092.4 279.0 74.7 230.4 379.3 -28.7 12.9 64.8 1,012. 5 —19.1 27.8 58.1 13.2 July 3 1,092. 0 278.8 74.7 230.4 378.3 -28.7 14.3 64.8 1,012.6 -19.4 27.9 57.7 13.2 TABLE 7.—BROKERAGE BALANCES,' BYCOUNTRIES From th r J o a u n g . h 2 — , 1935, Total U K d n i o i n m t g e - d France N la e e n r t d - h s - S l w a e n i r t d z- m G a e n r y - Italy E O u t r h o e p r e E T u o ro ta p l e Canada A L m a e t r i i n ca Asia i ot A he ll r i 1935—Dec. 31 6.0 (8) 2.4 1.3 2.5 -.2 .]L 1.4 .7.6 -4.5 1.0 2.9 -.0 1936—Dec. 30 12.9 4.0 10.4 -.9 9.1 I) .4 22.6 -7.6 -4.2 2.1 1937—Dec. 29 47.5 11.5 11.5 5.0 10.8 ;!L 5.0 44.0 3.5 -.5 .5 ®, 1938—Dec. 28 47.6 13.2 12.6 6.8 8.8 -.2 I 5.3 46.7 2.6 -.9 -1.0 1939— Sept. 27 83.1 24.2 18.4 9.4 15.3 -.1 I 7.0 74.3 9.7 2.1 -3.6 .7 Oct. 25 78.5 20.7 19.0 9.0 16.1 —.1 ! 6.0 70.9 9.2 2.0 -5.2 1.6 Nov. 29 77.1 19.6 19.0 9.6 15.7 (*) 5.0 69.1 9.0 1.1 -4.0 1.8 Dec. 27 78.1 19.5 18.5 10.7 16.4 -.2 5.2 70.2 8.0 1.1 -4.0 2.0 1940—Jan. 31 _ 88.2 18.9 19.6 9.4 18.3 -.2 5.7 71.9 10.9 1.7 1.7 2.0 Feb. 28 87.0 18.9 19.0 9.2 19.1 -.2 5.8 71.9 10.5 .8 2.0 1.9 Mar. 27 87.3 19.0 18.7 9.0 19.7 -.2 5.5 71.8 9.5 1.2 2.9 1.8 Apr. 24 88.2 18.5 17.9 10.2 21.2 -.1 5.7 73.6 10.4 -.1 2.6 1.8 May 29 95.1 17.6 18.4 10.5 18.5 <4) 2 7.1 72.1 10.3 6.3 5.8 .6 June 5 97.2 16.3 18.5 10.7 18.6 (4) L 7.6 71.7 10.4 8.4 6.0 .7 June 12 96.9 16.3 18.3 10.8 18.7 L 7.7 71.8 11.6 6.5 6.2 .8 June 19 98.5 16.5 18.2 11.1 18.7 (~) L 7.9 72.5 11.6 7.6 6.0 .8 June 26 97.6 16.4 18.2 11.2 17.8 I 8.1 71.7 10.8 8.4 6.0 .7 July 3 98.9 16.6 18.5 11.4 18.0 L 8.1 72.7 12.0 7.6 6.0 .7 * Prior to Jan. 3, 1940, the figures shown under Asia represent the Far East only, the remaining Asiatic countries being included under ' 'All other". a For explanation see BULLETIN for May 1937, pp. 395-396. »Inflow less than $50,000. * Outflow less than $50,000. 1144 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INTERNATIONAL CAPITAL TRANSACTIONS OF THE UNITED STATES OUTSTANDING SHORT-TERM ACCOUNTS, BY COUNTRIES [Outstanding amounts in millions of dollars] TABLE 8.—SHORT-TERM LIABILITIES TO FOREIGNERS, BY COUNTRIES Date Total U K d n i o i n t m g e - d France N la e e n r t d - h s - S l w a e n r i - t d z- m G a e n r y - Italy E O u t r h o e p r e E T u o ro ta p l e Canada A L m a e t r i i n ca Asia* ot A he ll r i Reported by Banks in New York City 1929—Deo. 31—— 2,672.7 301.5 923.7 99.1 105.2 204.5 157.4 371.3 2,162.8 241.8 188.2 49.0 31.0 1930—Dec. 31 2,335.0 214.5 799.4 122.2 222.2 161.0 111.2 281.3 1,911.7 216.8 130.8 38.2 37.6 1931—Dec. 30 1,303. 5 104.9 549.2 44.6 66.0 41.1 33.2 122.2 961.2 148.3 103.3 69.0 21.0 1932—Dec. 28 745.6 169.7 71.1 11.9 78.0 32.9 39.8 66.2 469.6 98.2 121.7 43.5 12.6 1933—Dec. 27 392.0 48.9 27.0 8.0 11.5 17.5 . 11.7 31.1 155.7 86.1 96.7 42.7 10.9 1934—Nov.28»___. 466.7 59.1 32.7 12.7 9.7 25.8 14.3 41.7 196.0 91.9 106.6 60.3 11.9 Reported by Banks in United States 1934—Dec. 5 8 584.8 79.6 36.1 13.5 12.1 28.4 16.8 | 40.6 227.1 103.3 117.4 125.1 12.0 1935—Jan. 2 597.0 76.9 33.9 12.9 13.7 29.9 18.8 46.8 232.9 99.3 122.8 130.1 12.0 Dec. 31 1,200.2 205.5 163.5 68.6 86.1 29.0 26.1 107.5 686.3 145.3 156.3 188.9 23.4 1936—Mar. 25 1,177.2 186.6 145.8 65.8 86.3 21.6 18.7 118.3 643.1 144.2 189.3 183.1 17.5 June 24 1,426. 2 270.5 157.8 102.8 128.3 20.6 25.3 123.1 828.2 160.6 207.4 208.2 21.7 Sept. 30 1,459. 6 293.7 163.2 76.8 147.3 19.2 29.2 128.8 858.3 170.7 200.5 210.2 19.8 Dec. 30 1, 491. 6 235.7 176.3 78.8 123.5 32.0 41.7 126.3 814.3 186.1 263.9 200.2 27.1 1937—Mar. 31 1,682. 7 226.9 173.0 60.4 113.1 53.9 36.6 140.8 804.7 210.0 441.0 204.6 22.6 June 30 2,173.6 373.1 206.2 145.0 331.4 40.3 23.0 177.9 1,296.9 190.1 448.8 210.4 27.4 Sept. 29 2,304.8 385.8 197.3 167.6 425.5 48.7 27.5 223.4 1,475.9 219.3 353.8 229.9 25.8 Dec. 29 1,729.6 261.5 143.9 89.1 302.1 39.0 25.7 156.0 1,017.1 175.6 280.9 236.0 20.0 1938—Mar. 30 1, 621.0 248.1 126.3 48. fi 236.7 25.7 14.9 135.7 835.8 186.4 257.9 219.5 21.3 June 29 1,357. 4 217,4 102.2 48.6 173.8 27.3 18.2 121.9 709.4 173.5 261.7 194.4 18.4 Sept. 28 1,732.4 308.5 165.6 82.2 191.0 17.6 17.2 232.8 1,015.0 190.8 285.0 207.9 33.7 Deo. 28 2,003. 9 438.8 190.9 98.4 217.4 19.9 22.6 249.9 1,237.8 235.2 254.9 243.7 32.4 1939—Jan. 25 1,992.6 419.2 199.9 103.4 226.8 16.8 18.4 269.1 1,253. 6 205.3 250.0 247.2 36.4 Feb. 22 2,089.0 445.2 216.6 119.4 238.4 16.7 13.0 257.7 1,306. 8 223.2 264.6 258.5 35.9 Mar. 29 2, 264. 2 473.9 219.5 143.9 247.1 18.7 14.8 314.7 1,432. 7 236.6 300.7 250.9 43.3 April 26 2, 505. 6 548.9 269.0 154.9 244.2 13.9 13.1 365.3 1,609. 3 267.0 330.6 251.4 47.3 May 31 2,612. 7 578.0 275.3 137.1 238.4 15.7 14.3 ,370.5 1,629. 3 309.4 371.7 253.8 48.0 June 28 2,619. 5 607.4 284.4 146.0 240.8 15.1 12.2 366.9 1,672. 7 291.7 363.0 242.5 49.7 July 26 2,637.4 667.5 284.2 153.8 248.8 13.8 12.8 379.6 1,660.4 293.6 375.5 253.6 64.4 Aug. 30 2,905.4 594.5 315.9 168.7 283.6 11.1 11.4 431.0 1,806. 2 356.2 389.8 283.7 69.4 Sept. 27—-. 2,983. 6 656.7 295.9 186.0 299.9 7.8 17.1 446.4 1,909. 7 325.3 383.0 299.5 66.2 Oct. 25 3,010.9 630.6 259.9 186.0 307.4 0.6 31.6 475.6 1,900. 7 309.2 379.0 352.4 69.6 Nov. 29 3,003.6 601.6 276.3 194.7 334.1 11.3 35.5 493.8 1,847. 2 327.6 361.0 384.5 83.4 Dec. 27 3,009.7 468.4 263.7 204.7 365.6 7.5 35.6 520.0 1,865.4 285.1 364.5 404.9 89.7 1940—Jan. 31— 2,994.7 404.5 290.6 200.3 395.5 9.1 43.7 569.0 1,912.6 266.9 352.2 392.1 70.9 Feb. 28... 2,991. 6 376.6 288.5 200.1 411.0 8.4 44.6 593.5 1,922.6 268.7 354.6 383.4 62.4 Mar. 27- 3,035.8 343.4 285.0 198.5 431.6 9.1 54.3 617.8 1,939. 7 273.2 372.0 396.4 54.5 Apr. 24._ 3,079. 7 343.7 291.1 214.4 448.2 8.1 73.3 609.4 1,988. 3 248.6 385.6 402.3 54.9 May 29.. 3,066.4 354.5 319.1 198.3 413.6 9.9 65.0 619.3 1,979.8 236.0 402.4 389.6 58.6 June 5___. 3,087.4 358.3 319.7 197.7 432.2 10.3 43.2 611.8 1,973. 2 235.2 409.6 404.5 64.9 June 12... 3,054.1 373.3 292.9 189.7 426.5 10.5 32.7 610.9 1,936. 5 240.1 404.3 408.9 64.4 June 19... 3, 254. 2 370.2 503.4 190.4 426.4 10.3 32.5 604.7 2,137. 8 235.6 412.7 404.6 63.4 June 26—. 3, 243. 9 367.3 487.4 189.3 432.2 9.6 28.9 608.9 2,123. 6 243.3 410.3 404.5 62.2 July 3___- 3, 342. 8 397.9 504.8 184.7 441.0 9.8 29.8 625.7 2,193. 8 259.2 421.4 408.2 60.3 Additional Detail Available from January 3,1940* 5 European countries 6 Latin American countries 4 Asiatic countries Date Total g B iu e m l- m D a e r n k - l F a i n n d - N w o a r y - S d w e e n - Total g t A i e n r n a - - B z r i a l - Chile Cuba M ic e o x- P C a a m a n . n d Z a - . Total China H Ko o n n g g Japan I P s p h la i i n l n i e p ds - 1940—Jan. 3.. 407.1 159.2 28.1 21.4 56.3 142.2 250.7 57.7 36.4 26.8 37.0 58.8 34.0 323.9 165.4 71.4 58.0 29.1 Jan. 31. 448.1 166.2 28.7 23.8 67.0 162.4 259.3 66.5 31.8 24.4 38.3 62.1 36.2 332.1 171.9 72.2 58.0 30.0 Feb. 28. 458.8 176.6 27.2 23.7 69.4 161.9 263.7 68.7 30.0 24.7 38.3 65.2 36.7 325.3 176.3 68.5 50.8 29.7 Mar. 27 482.1 179.2 29.9 25.2 68.4 179.4 279.0 68.1 34.9 23.4 44.3 68.8 39.4 332.9 177.6 75.4 47.1 32.8 Apr. 24. 457.1 184.0 23.8 26.9 67.6 154.7 292.6 76.4 36.9 23.7 45.6 67.6 42.5 339.2 180.2 77.5 48.2 33.3 May 29 443.3 172.0 21.1 29.5 64.1 156.7 311.8 83.3 34.8 24.8 49.6 68.6 50.6 333.9 174.8 79.4 43.5 36.2 June 5__ 435.1 167.8 20.1 29.3 63.0 154.9 316.9 90.1 35.0 27.6 48.2 68.8 47.1 345.3 177.4 79.2 52.0 36.7 June 12. 434.4 165.6 20.1 29.0 62.2 157.5 311.5 89.3 34.2 27.4 46.8 68.7 45.2 340.6 181.1 78.4 46.2 34.9 June 19_ 431.3 164.7 20.1 29.5 60.6 156.4 316.3 93.6 36.1 26.9 47.6 67.8 44.3 333.6 179.3 77.3 41.8 35.1 June 26. 434.4 165.8 19.8 29.5 60.0 159.4 316.6 89.0 38.6 30.2 47.1 66.1 45.7 331.8 178.6 77.5 41.9 33.8 July 3_. 457.0 161.3 19.5 29.6 59.0 187.6 326.5 88.7 39.0 30.2 49.7 65.3 53.5 334.9 177.7 78.4 43.3 35.6 i Prior to January 3, 1940, the figures shown under Asia represent the Far East only, the remaining Asiatic countries being included under "All other". * Last report date on old basis. * First report date on new basis. America, and Asia. NOTE.—The figures given in this table are not fully comparable throughout as a result of certain chaDges or corrections in the reporting practice of reporting banks which occurred on August 12, 1936, January 5, 1938, and October 18, 1939 (see BULLETIN for May 1937, p. 425; April 1939, p. 295; and April 1940, p. 362). OCTOBER 1940 1145 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

INTERNATIONAL CAPITAL TRANSACTIONS OF THE UNITED STATES OUTSTANDING SHORT-TERM ACCOUNTS, BY COUNTRIES [Outstanding amounts in millions of dollars] TABLE 9.—SHORT-TERM FOREIGN ASSETS, BY COUNTRIES Date Total U K d n i o i n m t g e - d France N la e e n r t d - h s - S l w a e n r i - t d z- m G a e n r y - Italy E O u t r h o e p r e E T u o ro ta p l e Canada Am L e a r t i i c n a Asia* ot A he ll r i Reported by'Banks in New York City 1931—Dec. 30—. 1,103.3 166.2 29.5 20.9 12.6 467.2 18.7 149.2 864.3 58.1 136.5 41.8 2.6 1932— Dec. 28 — 937.9 87.3 62.9 13.0 6.2 434.9 11.8 97.0 713.1 42.2 155.2 24.0 3.5 1933—Dec. 27— 898.8 192.5 66.9 18.4 12.3 260.9 16.7 83.2 651.0 32.3 159.7 49.7 6.2 1934—Nov. 28 > - 827.1 201.3 94.1 15.9 8.5 178.8 10.7 60.2 569.5 84.4 124.4 46.2 2.6 Reported by Banks in United States 1934—Deo. 5»_. 1,137.8 266.4 108.2 19.2 8.3 239.6 26.5 81.3 749.5 91.2 170.7 118.1 8.3 1935—Jan. 2 1,139.9 296.9 80.5 18.6 8.2 231.7 27.2 80.0 743.2 96.3 174.6 117.4 8.5 Dec. 31— 778.6 88.1 32.5 19.0 6.6 202.0 13.5 71.2 433.0 100.9 154.5 80.1 10.1 1936— Mar. 25... 736.3 82.7 26.5 22.9 5.4 198.6 12.6 64.8 413.5 78.7 158.7 74.3 11.2 June 24 691.6 77.3 23.9 21.2 4.5 187.0 12.7 57.8 384.4 78.0 144.0 73.9 11.4 Sept. 30... 647.9 75.8 81.5 21.5 5.2 160.6 11.0 52.0 407.6 49.1 126.6 54.4 10.2 Dec. 30— 672.6 114.1 16.8 21.9 5.4 165.1 10.9 57.8 392.1 59.4 141.1 67.2 12.9 1937—Mar. 31__. 693.1 99.7 15.8 17.1 4.9 162.2 13.0 68.1 370.7 71.7 135.3 100.0 15.5 June 30— 637.7 76.6 13.2 13.7 3.5 143.9 14.8 55.2 319.9 87.8 132.0 83.6 14.5 Sept. 29... 586.0 75.3 11.1 19.1 4.2 132.0 16.8 52.8 311.3 82.5 107.0 71.7 13.5 Dec. 29— 655.0 84.8 13.5 23.0 5.6 126.1 20.8 52.9 326.5 118.0 114.4 78.9 17.2 1938—Mar. 30... 669.7 120.6 11.4 23.5 4.8 112.0 18.1 51.0 341.4 93.3 113.5 104.1 17.4 June 29— 700.8 141.4 16.2 25.2 5.9 102.6 16.1 49.0 356.4 87.6 116.6 126.4 13.8 Sept. 28... 626.9 121.9 11.4 22.6 4.4 99.1 17.0 46.3 322.7 84.0 94.2 113.6 12.4 Dec. 28— 626.0 87.7 13.3 25.5 5.4 90.9 13.3 46.7 282.8 65.7 99.2 162.6 15.7 1939—Jan. 25.... 603.2 98.5 8.7 23.8 4.5 88.6 14.4 43.9 282.4 62 A 95.7 157.9 14.8 Feb. 22— 569.1 82.0 12.4 22.4 4.2 84.0 13.3 48.0 266.3 49.0 98.3 140.4 15.0 Mar. 29... 553.6 83.0 13.8 20.1 3.6 81.4 16.4 48.8 267.1 46.3 99.5 125.7 14.9 April 26... 492.3 64.2 11.7 17.9 3.6 79.4 13.5 44.7 235.0 48.0 94.9 103.6 10.9 May 31... 504.3 55.4 10.7 18.7 3.4 79.2 11.9 41.1 220.4 49.4 111.1 110.6 12.8 June 28 496.6 55.4 10.7 19.7 4.5 77.4 9.5 39.9 217.0 54.0 110.3 100.5 14.8 July 26—. 497.2 55.2 7.3 21.7 3.2 74.7 9.3 39.1 210.3 62.7 111.8 108.7 13.6 Aug. 30... 483.5 66.9 8.7 10.3 2.5 73.0 12.6 44.7 218.6 44.0 104.1 103.3 13.5 Sept. 27... 485.7 66.0 8.7 9.6 2.9 67.1 12.2 41.6 208.1 49.7 108.5 104.0 15.4 Oct. 25.... 558.1 64.5 8.6 9.3 3.9 60.7 11.8 48.5 207.2 61.1 112.0 172.6 15.2 Nov. 29... 537.1 46.5 5.4 6.6 4.7 58.5 9.4 52.0 183.1 43.6 114.0 179.3 17.0 Dec. 27— 546.3 44.4 5.0 6.6 4.9 53.9 10.9 53.0 178.7 46.3 117.5 186.9 16.0 1940—Jan. 31—. 533.0 56.2 5.3 7.2 5.1 52.3 13.7 49.5 189.1 40.1 110.2 184.6 9.1 Feb. 28— 531.4 44.7 5.4 5.7 5.5 51.8 15.5 49.3 177.9 44.2 109.8 190.3 9.2 Mar. 27— 522.2 47.0 5.8 8.9 6.3 50.8 17.3 49.4 185.6 42.7 109.5 175.4 9.1 Apr. 24... 500.0 36.7 5.8 5.5 6.5 50.2 16.9 48.2 169.8 36.1 112.9 172.6 8.7 May 29... 475.0 30.1 7.9 3.2 5.0 47.3 18.3 44.6 156.5 26.7 113.3 169.5 9.0 June 5 480.0 28.9 7.8 3.3 4.6 48.0 16.9 44.4 154.0 32.1 113.4 171.4 9.1 June 12— 484.6 31.6 7.4 3.0 4.3 48.0 18.7 43.5 156.6 35.7 113.4 169.7 9.2 June 19... 477.9 32.3 5.7 2.9 4.2 47.8 17.0 43.9 153.6 30.9 113.0 171.3 9.1 June 26— 469.0 33.1 5.9 2.8 4.0 47.8 14.9 43.2 151.8 29.6 118.6 160.0 9.0 July 3 475.0 32.0 6.2 2.6 3.8 47.3 14.2 41.0 147.2 35.3 117.0 167.9 7.7 Additional Detail Available from January 3,1940 * 5 European countries 6 Latin American countries 4 Asiatic countries Date Total g B iu e m l- m D a e r n k - l F a i n n d - N w o a r y - S d w en e- Total g t A i e n r n a - - B z r i a l - Chile Cuba M ic e o x- C P a a m a . n Z n d a . - Total China H K o o n n g g Japan I P s p h la i i n n li e d p s - 1940—Jan. 3.. 23.4 6.5 3.2 1.4 3.6 8.7 76.1 16.8 32.2 9.7 10.5 5.9 1.0 152.5 22.0 1.9 102.1 26.4 Jan. 31. 22.2 7.2 3.7 1.2 3.7 6.5 71.5 12.9 31.2 9.6 10.4 6.5 .9 161.9 22.5 1.6 111.2 26.6 Feb. 28. 20.4 7.4 2.9 .8 4.0 5.4 69.9 12.0 31.8 9.7 11.1 4.4 .9 168.0 25.4 3.2 111.2 28.2 Mar. 27 19.7 8.1 2.2 .8 3.9 4.7 70.1 12.2 31.6 9.4 11.2 4.7 1.0 165.4 25.7 1.5 109.6 28.6 Apr. 24. 18.3 8.4 1.4 1.0 3.6 3.9 72.9 12.4 34.5 9.6 10.2 5.0 1.2 161.7 24.3 1.4 108.1 28.0 May 29 14.1 5.1 1.1 1.5 2.4 4.2 73.9 16.4 32.1 9.5 9.8 5.0 1.1 160.1 24.5 1.9 103.2 30.5 June S.- 13.6 4.5 1.4 1.5 2.2 4.0 74.2 16.3 31.9 9.7 10.2 4.8 1.1 161.6 24.3 1.9 104.0 31.5 June 12. 12.7 4.2 1.0 1.5 2.0 4.0 74.0 16.2 32.3 10.5 9.2 4.7 1.2 159.5 24.0 1.8 102.3 31.4 June 19. 12.0 4.1 .9 1.5 1.8 3.7 73.2 16.3 31.9 9.5 9.2 5.0 1.3 160.1 25.0 2.5 100.4 32.3 June 26. 11.3 3.9 .8 1.5 1.7 3.5 78.3 16.7 34.0 9.8 11.4 5.1 1.2 148. 5 24.7 2.5 89.7 31.6 July 3.. 10.6 3.4 .7 1.5 1.5 3.4 77.5 16.7 33.7 9.7 11.4 4.8 1.3 155.2 30.2 1.6 90.6 32.7 i Prior to January 3, 1940, the figures shown under Asia represent the Far East only, the remaining Asiatic countries being included under "All other". * Last report date on old basis. 3 First report date on new basis. * The figures in this supplementary table represent a partial analysis of the figures in the main table under the headings Other Europe, Latin America, and Asia. NOTE.—The figures given in this table are not fully comparable throughout as a result of certain changes or corrections in the reporting practice of reporting banks which occurred on August 12, 1936, and October 18, 1939 (see BULLETIN for May 1937, p. 431, and April 1940, p. 363). 1146 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

CENTRAL BANKS Assets of Bank of England issue dept. Assets of banking department Liabilities of banking department Note (Fi p gu o r u e n s d s in s m te i r l l l i i n o g n ) s of Other Cash reserves co D u i n s- ts Securi- ci t r i c o u n la- Deposits Other Goldi assets 2 and ad- ties liabili- Coin Notes vances Bankers' Public Other ties 1929—Dec. 25.. 145.8 260.0 .2 26.3 22.3 84.9 379.6 71.0 8.8 35.8 17.9 1930—Dec. 31.. 147.6 260.0 .6 38.8 49.0 104.7 368.8 132.4 6.6 36.2 18.0 1931—Dec. 30.. 120.7 275.0 .6 31.6 27.3 133.0 364.2 126.4 7.7 40.3 18.0 1932—Dec. 28.. 119.8 275.0 .8 23.6 18.5 120.1 371.2 102.4 8.9 33.8 18.0 1933—Dec. 27.. 190.7 260.0 1.0 58.7 16.8 101.4 392.0 101.2 22.2 36.5 18.0 1934—Dec. 26.. 192.3 260.0 .5 47.1 7.6 98.2 405.2 89.1 9.9 36.4 18.0 1935—Dec. 25.. 200.1 260.0 .6 35.5 8.5 94.7 424.5 72.1 12.1 37.1 18.0 1936—Dec. 30.. 313.7 200.0 46.3 17.5 155.6 467.4 150.6 12.1 39.2 18.0 1937—Dec. 29.. 326.4 220.0 41.1 9.2 135.5 505.3 120.6 11.4 36.6 18.0 1938—Dec. 28.. 326.4 230.0 51.7 28.5 90.7 504.7 101.0 15.9 36.8 18.0 1939—June 28.. 3 226. 4 300.0 27.4 6.8 136.7 499.0 101.4 15.4 37.0 17.9 July 26... 3 246. 4 300.0 35.5 8.0 128.0 510.9 91.4 26.0 36.7 18.1 Aug. 30.. 263.0 300.0 33.5 6.4 137.8 529.5 90.1 31.1 39.0 18.2 Sept. 27.. 3.1 580.0 38.3 2.5 144.2 541.8 107.1 19.8 40.5 18.3 Oct. 25... .2 580.0 53.0 4.6 127.7 527.1 116.8 12.6 39.2 17.7 Nov. 29_. .2 580.0 1.1 51.6 4.5 132.1 528.7 103.5 27.8 40.2 17.8 Dec. 27.. .2 580.0 1.0 25.6 4.3 176.1 554.6 117.3 29.7 42.0 17.9 1940—Jan. 31— .2 580.0 52.5 3.1 143.9 527.7 98.1 39.7 44.3 18.0 Feb. 28.. .2 580.0 1.0 49.0 2.8 149.4 531.2 99.4 45.7 38.9 18.1 Mar. 27.. .2 580.0 1.1 37.1 6.1 157.2 543.1 98.0 43.1 42.2 18.2 Apr. 24.. .2 580.0 1.0 43.1 4.9 153.5 537.1 103.4 40.7 40.6 17.7 May 29.. .2 580.0 1.4 23.4 2.9 171.6 556.9 94.9 36.1 50.5 17.8 June 26__ .2 630.0 1.5 28.1 4.7 174.6 602.2 82.7 58.0 50.3 17.9 July 31_. .2 630.0 .9 20.7 3.3 174.4 609.5 106.3 22.7 52.3 18.0 Aug. 28- .2 630.0 .7 20.2 3.9 172.6 610.0 118.7 8.8 51.8 18.1 Assets Liabilities Domestic bills Loans on- Deposits Bank of France Ad- For- vances (Figures in millions of francs) Gold* ch e e a i x g n - n ge m O ar p k e e n t' c S i p a e l" - Other m G e e t r o o n n v t - - 7 m G S t e o h e n v r o t e m r r t s n - e - - s O e t c t i h e u s e ri r - O as t s h e e ts r c N i t r i c o o u t n e la- G m ov e e n r t n- Other l O i t a i t b e h s i e l r icurities 1929—Dec. 27. 41,668 25,942 5,612 8,624 2,521 68, 571 11, 737 7,850 1,812 1930—Dec. 26_ 53, 578 26,179 5,304 8,429 2,901 76,436 12,624 11,698 2,241 1931—Dec. 30_ 68,863 21, 111 7,157 7,389 2,730 8,545 85, 725 5,898 22,183 1,989 1932—Dec. 30. 83,017 4,484 3,438 2,515 9,196 85,028 2,311 20,072 2,041 1933—Dec. 29. 77,098 1,158 6,122 4,739 2,921 8,251 82,613 2,322 13,414 1,940 1934—Dec. 28_ 82,124 963 5,837 3,971 3,211 83,412 3,718 15,359 1,907 1935—Dec. 27- 1,328 5,800 9,712 573 3,253 7,879 81,150 2,862 8,716 2,113 1936—Dec. 30_ 60,359 1,460 5,640 1,379 8,465 17,698 715 8,344 89,342 2,089 13, 655 2, 557 1937—Dec. 30_ 58,933 911 5,580 652 10,066 31,909 675 3,781 7,277 93,837 3,461 19,326 3,160 1938—Dec. 29. 87, 265 821 7,422 1,797 7,880 20, 627 443 3,612 14,442 110,935 5,061 25, 595 2,718 1939— Mar. 30. 87,266 758 8,631 2,054 5,733 20,627 172 3,332 14, 558 119,748 3,955 16,702 2,726 April 27 92,266 756 2,165 6,012 20, 577 127 3,362 14, 452124, 666 3,755 17,255 2,649 May 25. 92, 266 754 8,164 2,276 4,774 20, 577 78 3,401 14,264 121,391 4,573 17, 570 3,020 June 29. 92, 266 722 8,074 2,279 5,009 20, 577 374 3,471 14, 753122,611 5,188 16,909 2,816 July27. 92, 266 722 8,316 2,275 5,000 20, 577 472 3,461 14,458 123, 239 5,468 16,058 2,781 Aug. 31. 97, 266 218 9,396 1,708 15,009 20, 577 2,412 3,805 16,016 142,359 3,304 18,038 2, 708 Sept. 28. 97,266 212 9,734 1,958 14,830 22, 777 930 3,661 16,482 144, 562 2,342 18,022 2, 926 Oct. 26. 97, 266 85 10,038 2,007 25,473 336 3,576 17,100 144,379 2,004 14, 790 3,006 Nov. 30. 97, 266 120 10,565 1,626 5,206 30,473 454 3,581 17, 769149,370 1,953 12,392 3,346 Dec. 28_ 97, 267 112 11,273 2,345 5,149 34,673 174 3,482 16,438 151,322 1,914 14,751 2,925 1940—Jan. 25.. 97,268 111 11,861 2,235 5,011 35,673 229 3,444 15,963 151, 738 1,834 14,965 3,259 Feb. 29_ 97, 275 109 12, 505 1,810 4,630 40,523 465 3,403 16,917 156,150 1,203 17,128 3,156 Mar. 28. 84,614 111 42, 645 1,870 5,005 20, 550 320 3,376 15,970 156,032 1,154 14, 262 3,014 Apr. 25. 84, 615 112 42,694 1,781 5,769 20,900 228 3,411 15,666 156,285 1,171 14, 681 3,038 May 30. 84, 616 102 44,083 1,889 14, 473 32, 600 2,320 3,716 16, 694170,853 1,046 25, 782 2,811 1 Effective Mar. 1, 1939, gold valued at current prices instead of legal parity (see BULLETIN for April 1939, p. 271). 2 Securities and silver coin held as cover for fiduciary issue, which has been fixed at £630,000,000 since June 12,1940; for information concerning previous status of fiduciary issue see BULLETIN for November 1939, p. 1024, and April 1939, p. 339. 3 On Jan. 6,1939, £200,000,000 of gold (at legal parity) transferred from Bank to Exchange Equalization Account; on Mar. 1,1939, about £5,500,000 (at current price) transferred from Exchange Account to Bank; on July 12,1939, £20,000,000 of gold transferred from Exchange Account to Bank; on Sept. 6, 1939, £279,000,000 transferred from Bank to Exchange Account. * By decree of Feb. 29, 1940 (see BULLETIN for May 1940, pp. 406-407), gold revalued on basis of 23.34 milligrams gold 0.900 fine per franc. Increment of about 17,000,000,000 francs supplemented by certain other funds was applied to the full repayment of advances to the Government granted under authority of the decree of Nov. 12, 1938, in the amount of 20,473,000,000 francs. Gold also revalued in Oct. 1936, July 1937, and Nov. 1938. For further details see BULLETIN for November 1936, pp. 878-880; September 1937, p. 853; and January 1939, p. 29. e Negotiable bills of Caisse Autonome, bills bought under authority of decree of June 17, 1938 (see BULLETIN for August 1938, p. 650) and, from Mar. 28,1940,30,000,000,000 francs of negotiable Treasury bills received in return for gold transferred to Exchange Stabilization Fund on Mar. 7, 1940. 8 Bills and warrants endorsed by National Wheat Board (law of Aug. 15, 1936—see BULLETIN for October 1936, pp. 785-786), and bills rediscount ed for account of Banques Populaires (law of Aug. 19, 1936—see BULLETIN for October 1936, p. 788). i Includes advances granted under authority of Conventions between Bank of France and Treasury of June 18, 1936, June 30, 1937, March 22,. 1938, and April 14,1938, as modified by Convention of Nov. 12,1938; Convention of Sept. 29,1938, approved by decree of Sept. 1, 1939; and Convention of Feb. 29, 1940 (see BULLETIN for May 1940, pp. 406-407). s On April 20, and again on Aug. 3, 1939, 5,000,000,000 francs of gold transfeired from Exchange Stabilization Fund to Bank of France; on Mar. 7, 1940, 30,000,000,000 francs of gold transferred from Bank of France to Stabilization Fund. NOTE.—For further explanation of table see BULLETIN for July 1935, p. 463, and February 1931, pp. 81-83. OCTOBER 1940 1147 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Central Banks—Continued Assets Liabilities (Figu r R r e e i e s c i h c i s n h m s m b a a r i k l n l s k i ) ons of Re fo se re r i v g e n s o e f x g ch ol a d n g a e nd B i c n i h l c l e l s u c k d ( s a in ) n , g d Security Eligi S b e le curities Other ci N rc o u t l e a- Deposits l O ia t b h i e li r re T s o er t v al es Gold* Tr b e i a l s ls ury loans a c s o n ve o r te Other tion ties 1929—Dec. 31_ 2,687 2,283 2,848 251 92 656 5,044 755 736 1930—Dec. 31. 2,685 2,216 2,572 256 102 638 4,778 652 822 1931—Dec. 31. 1,156 984 4,242 245 161 1,065 4,776 755 1,338 1932—Dec. 31. 920 806 2,806 176 398 1,114 3,560 540 1,313 1933—Dec. 30. 396 386 3,226 183 322 735 3,645 640 836 1934—Dec. 31. 84 79 4,066 146 445 319 827 3,901 984 1,001 1935—Dec. 31. 88 82 4,552 84 349 315 853 4,285 1,032 923 1936—Dec. 31. 72 66 5,510 74 221 303 765 4,980 1,012 953 1937—Dec. 31. 76 71 6,131 60 106 286 861 5,493 1,059 970 1938—Dec. 31. 76 71 8,244 45 557 1,621 8,223 1,527 1,091 1939—Aug. 31. 77 10, 272 1,013 296 1,964 10,907 1,480 1,294 Sept. 30 77 10,105 1,324 393 1,963 10,995 1,602 1,287 Oct. 31_ 77 9,358 1,440 366 2,375 10,820 1,520 1,312 Nov. 30 77 10,148 997 365 2,257 10,974 1,574 1,332 Dec. 30. 78 11,392 804 393 2,498 11,798 2,018 1,378 1940—Jan. 31. 77 11,143. 374 401 2,487 11,505 1,628 1,382 Feb. 29. 77 11,825 172 367 2,380 11,877 1,559 1,422 Mar. 30 78 12,242 144 394 2,557 12,176 1,760 1,509 Apr. 30. 78 12,188 221 364 2,651 12,480 1,714 1,338 May 31. 77 12, 569 142 363 2,135 12,594 1,470 1,253 June 29. 77 12,611 143 454 2,595 12,785 1,854 1,266 July 31 78 12,613 114 408 2,377 12,750 1,620 1,248 Aug. 31P 77 12,891 (*) 13,026 00 (») * Preliminary. i Not shown separately on Reichsbank statement after June 15,1939. » Figures not yet available. NOTE.—For explanation of above table see BULLETIN for July 1935, p. 463, and February 1931, pp. 81-83. Central Bank 1940 1939 Central Bank 1940 1939 [Figures as of last report [Figures as of last report date of month] Aug. July June Aug. date of month] Aug. July June Aug. National Bank of Albania (thou- National Bank of Belgium (millions sands of francs): (Mar.)i ofbelgas): (Apr.)i Gold 7,567 7,567 Gold and foreign exchange _ __ 4,614 4,554 Forei&n assets 65,135 39,531 Discounts 991 374 Loans and discounts 10,315 4,965 Loans _ __ 69 273 Other assets 7,829 8,286 Other assets 512 472 Note circulation 28,419 25,034 Note circulation. _ __ _ . .. 5,880 5,299 Other sight liabilities 46,830 21,515 Demand deposits—Treasury 4 Other liabilities 15,598 13, 799 P Other I 182 247 Central Bank of the Argentine Other liabilities 124 124 Republic (millions of pesos): Central Bank of Bolivia (thousands Gold reported separately 1,224 1,224 of bolivianos) : Other gold and foreign exchange- 168 105 Gold at home and abroad 96,831 62,397 Negotiable Government bonds 239 282 Foreign exchange 79,406 62,246 Other assets 226 238 Loans and discounts 229,145 61, 225 Note circulation 1,220 1,135 Securities—Government 423, 713 407, 549 T>epo.sitS—Memher hftnlr .. , 401 430 Other 12,982 5,121 Go V6TI TO ftP t 159 169 Other assets __ _ 20,236 45,862 Other 3 3 Note circulation 422,171 316, 676 Foreign exchange sold forward 18 60 Deposits 348,805 259, 768 Other liabilities 59 52 Other liabilities 91, 338 67,955 Commonwealth Bank of Australia National Bank of Bulgaria (mil- (thousands of pounds): lions of leva): (Apr.)i Issue department: Gold _ 2,006 2,006 Gold and English sterling 16,082 16,030 Net foreign exchange in reserve. . 4 Securities ____ --._ 53,645 41,500 Foreign exchange 1,800 842 Banking department: Loans and discounts 1,110 1,814 Coin, bullion, and cash _ 5,377 1,467 Government debt L 3,393 3,417 London balances 42,993 15 874 Other assets _„ 2,030 1,118 Loans and discounts 33,480 17,620 Note circulation 4,526 3,960 Securities 34,282 59,550 Deposits 3,421 3,014 Deposits 108,212 87,262 Other liabilities 2,396 2,223 Note circulation 60,875 48, 525 Bank of Canada (thousands of Ca- Bank of Belgian Congo (millions of nadian dollars): Belgian francs): (Jan.)* Gold« 209,775 Gold 171 171 Sterling and United States ex- Foreign (gold) exchange 5 change 2,723 5,700 3,251 52,860 Loans and discounts 617 523 Canadian Gov't. securities: Other assets 526 518 2 years or less _ 430,113 392,235 402,914 111, 018 Note circulation 421 389 Over 2 years ___121,189 123, 598 118,485 52,078 Deposits 735 686 Other assets 18,222 9,318 11,289 7,125 Other liabilities 164 137 Note circulation _ ___306, 534 291,676 272, 565 179,704 Deposits—Chartered banks 215, 539 194, 423 208, 584 201,318 Dominion Gov't - 32,857 24,140 36, 576 30,695 Other _ 3,610 8,222 4,360 11, 216 Other liabilities 13, 707 12,389 13,854 9,923 1 Latest month for which report is available for this institution. 2 On May 1,1940, gold transferred to Foreign Exchange Control Board in return for short-term government securities (see BULLETIN for July 1940, pp. 677-678). 1148 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Central Banks—Continued Central bank 1940 1939 Central bank 1940 1939 [Figures as of last report [Figures as of last report date of month] Aug. July June Aug. date of month] Aug. July June Aug. Central Bank of Chile (millions of Central Reserve Bank of El Salvador—Cont. Gold 146 146 146 Deposits _. 5,587 6,101 7,374 Discounts for member banks 160 147 67 Other liabilities 5,149 3,979 3,550 Loans to government 746 746 754 Bank of Estonia (thousands of Other loans and discounts _. 371 367 231 krooni): (May): Other assets 22 24 43 Gold 40,903 40,904 Note circulation 1,028 1,027 845 Foreign exchange (net) 4, 303 9,454 Deposits— Loans and discounts __. 48,851 31,476 Bank _ 154 159 157 Other assets 34,084 40,293 Other _ 104 88 86 Note circulation 62, 726 56,981 Other liabilities 160 157 153 Demand deposits 34, 039 28,027 Bank of the Republic of Colombia Other liabilities... 31, 376 37,119 (thousands of pesos): Bank of Finland (millions of mark- (Oct. Gold.. - 26,870 30, 945 37,739 35,453 kaa): 1939)1 Foreign exchange 11,012 8,566 4,833 7,543 Gold 1,180 1,183 Loans and discounts 24,859 22, 242 22,805 19,434 Foreign assets _ 2,085 2,487 Government loans and securities. 40, 321 38, 379 38,467 37,167 Loans and discounts 2,059 1,155 Other assets 31,612 31, 925 29,873 31, 787 Domestic securities 328 332 Note circulation 55, 237 54, 957 57,037 53, 628 Other assets _ 343 304 Deposits _ 53, 232 51, 766 50, 593 45, 786 Note circulation 3,378 2,262 Other liabilities 26, 204 25, 333 26,087 31, 969 Deposits—Treasury 242 National Bank of Bohemia and Mo- Other _ __. 553 90b ravia (millions of koruny): (May)i Other liabilities _ 2,064 2,050 Gold _ 1,596 1,698 Bank of Greece (millions of drach- Foreign exchange 728 796 mas): Discounts 445 1,855 Gold and foreign exchange (net)_. 4,790 4,600 3,097 Loans 542 804 Loans and discounts 14, 580 15,078 12,388 Other assets 6,566 4,354 Government obligations 4,049 4,105 4,211 Note circulation 5,601 6,056 Other assets 3,087 2,755 2,164 Demand deposits 839 702 Note circulation 10,603 11,475 9,980 Other liabilities _ 3,437 2,750 Deposits _ 13, 556 13,046 9,993 National Bank of Denmark (mil- Other liabilities 2,346 2,017 1,887 lions of kroner): National Bank of Hungary (mil- Gold _. 117 117 lions of pengo): Foreign exchange 9 Gold 124 124 124 Clearing accounts (net) „_ 113 Foreign exchange reserve 57 59 101 Discounts 25 25 Discounts. __ _ 693 670 576 Loans—To Government agencies 228 97 Loans—To Treasury 337 343 343 Other 175 150 Other .„. 47 46 43 Securities 184 189 Other assets 382 325 352 Other assets 156 108 Note circulation _. 1,158 1,078 1,038 Note circulation. __ 697 452 Demand deposits. 114 162 181 Deposits 127 Certificates of indebtedness 94 94 99 Other liabilities 195 Other liabilities 275 234 221 Central Bank of Ecuador (thou- Reserve Bank of India (millions of sands of sucres): (May)i rupees): Gold 31, 929 39, 031 Issue department: (May)i Foreign exchange (net) 7,193 Gold at home and abroad... 444 444 Loans and discounts 68,179 60,011 Sterling securities. 1,235 595 Other assets _ 25,416 18,459 Indian Gov't. securities 425 374 Note circulation 62,886 64, 742 Rupee coin. 466 755 Demand deposits _ 36,032 44, 252 Note circulation 2,485 1,789 Other liabilities 26, 605 15, 701 Banking department: National Bank of Egypt* (thou- Notes of issue department... 85 379 sands of pounds): (Apr.)i Balances abroad 199 74 Gold.... 6,544 6,545 Treasury bills discounted 28 4 Foreign exchange 2,729 1,708 Loans to Government 20 Loans and discounts 8,141 5,744 Investments . 87 British, Egyptian, and other Other assets _ 15 13 Government securities 30, 608 27,010 Deposits 315 428 Other assets _ 6,995 11,973 Other liabilities 119 116 Note circulation 25,489 22,186 Bank of Japan (millions of yen): Deposits—Government 2,392 3,945 Gold _ 501 501 501 Other 18,076 18, 248 Special foreign exchange fund 300 300 300 Other liabilities. 9,060 8,603 Discounts _ 618 834 387 Central Reserve Bank of El Salva- Loans—To Government 3 3 3 dor (thousands of colones): Other 82 142 58 Gold _-_ 13, 219 13,216 13, 208 Government bonds 2,495 2,547 1,850 Foreign exchange _ 2,660 2,256 5,172 Other assets.. 423 420 447 Loans and discounts 2,435 2,473 837 Note circulation 3,326 3,597 2,461 Government debt and securities- 5,298 5,296 5,104 Deposits—Government 651 596 652 Other assets _ 1,311 1,216 1,092 Other.. 93 152 83 Note circulation 14,187 14, 376 14,490 Other liabilities 352 402 351 i Latest month for which report is available for this institution. > Items for issue and banking departments consolidated. OCTOBER 1940 1149 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Central Banks—Continued Central bank 1940 1939 Central bank 1940 1939 [Figures as of last report [Figures as of last report date of month] Aug. July June Aug. date of month] Aug. July June Aug. Bank of Java (millions of guilders): National Bank of Rumania—Cont. Gold _ 144 Other assets 12, 824 12,433 12, 490 Foreign bills. 20 Note circulation _ 58, 961 56,331 42, 351 Loans and discounts 103 67 Demand deposits _ 15, 000 15,803 11,004 Other assets __. 122 91 Other liabilities 8,939 8,720 13,150 Note circulation 207 193 South African Reserve Bank (thou- Deposits _ 154 77 sands of pounds): Other liabilities _ 28 25 Gold 37, 032 36, 656 26, 910 Bank of Latvia (millions of lats): Foreign bills 1,435 1,510 6,421 Gold 72 Other bills and loans 3,958 1,746 2,719 Foreign exchange reserve 30 35 Other assets 33,880 35, 213 15,848 Loans and discounts 217 153 Note circulation _ 21, 788 22, 757 16, 712 Other assets _ 43 52 Deposits... 50, 325 48, 587 31, 676 Note circulation 117 89 Other liabilities 4,192 3,781 3,511 Deposits _ _ 188 204 Bank of Sweden (millions of Other liabilities 57 45 kronor): Bank of Lithuania (millions of litu): Gold. 380 438 782 Gold - 66 Foreign assets (net)— 578 437 549 Foreign exchange 10 Domestic loans and investments. 727 895 258 Loans and discounts 199 132 Other assets 839 840 545 Other assets 63 43 Note circulation. 1,430 1,478 1,126 Note circulation. __. 193 173 Demand deposits ___. 295 140 '825 Deposits _ 104 39 Other liabilities- _ 800 992 183 Other liabilities 41 30 Swiss National Bank (millions of Netherlands Bank (millions of guil- francs): ders): (Apr.)* Golds 2,114 2,135 2,419 Gold 1,160 1,129 Foreign exchange 489 399 288 Silver (including subsidiary coin) 12 17 Discounts _ 248 292 63 Foreign bills 1 2 Loans _ _ 66 115 43 Discounts _ _ 10 48 Other assets ___ 268 256 684 Loans _ 226 260 Note circulation 2,161 2,252 2,024 Other assets 71 68 Other sight liabilities 752 668 828 Note circulation _ ___ 1,166 1,132 Other liabilities 271 276 646 Deposits—Government—_ _ 25 Centra] Bank of the Republic of Other 228 344 Turkey (thousands of pounds) : Other liabilities 59 48 Gold ____ 107, 923 110, 295 Reserve Bank of New Zealand Foreign Exchange—Free 39 59 11 (thousands of pounds): In clearing accounts __. 21,451 21,427 3,556 Gold 2,802 2,802 2,802 Loans and discounts 297,411 270,496 154,080 Sterling exchange reserve 13,027 14,826 5,690 Securities.. 195, 692196,012 193, 539 Advances to State or State un- Other assets 38,603 36, 260 28,053 dertakings 25,226 23, 517 19, 634 Note circulation _ 356, 938354,938 229,521 Investments 2,544 2,540 3,658 Deposits—Gold 78,124 78,124 Other assets 426 406 357 Other 90,661 63, 298 65, 461 Note circulation 19, 623 18, 617 15,802 Other liabilities 135, 394138,188 121,165 Demand deposits _ 22,168 23, 178 14, 377 Bank of the Republic of Uruguay Other liabilities _ 2,233 2,295 1,962 (thousands of pesos) : Bank of Norway (millions of Issue department: kroner): Mar.)i Gold and silver 86, 235 86, 235 Gold.. 186 236 Note circulation. _ 96, 728 89, 548 Foreign assets _ _ 102 128 Banking department: Total domestic credits and Gold 21,454 20,826 securities 435 309 Notes and coin 46,034 50,194 Discounts 136 Loans and discounts 113, 630108, 563 Loans 47 Other assets 119,807 .08,389 Securities _ 126 Deposits _ 99, 931 87,450 Other assets () 43 Other liabilities.... 200, 994200, 521 Note circulation __ 599 505 National Bank of the Kingdom of Demand deposits—Government- 9 21 Yugoslavia (millions of dinars): Other 112 109 Gold 2,286 2,244 1,924 Other liabilities 81 Foreign exchange.. 513 520 509 Central Reserve Bank of Peru Loans and discounts 1,855 1,901 2,132 (thousands of soles): (May)i Government debt 3,073 3,073 2,231 Gold and foreign exchange 46,150 48, 666 National defense bills 4,091 3,787 Discounts 19, 251 21,914 Other assets 3,117 3,389 3,332 Government loans .12,533 99,408 Note circulation 12,179 12, 210 7,986 Other assets 5,134 4,372 Other sight liabilities 1,941 1,862 1,350 Note circulation. 26, 474 21, 645 Other liabilities 815 841 791 Deposits 39,098 36, 921 Bank for International Settle- Other liabilities „ 17,496 15, 793 ments (thousands of Swiss gold Bank of Portugal (millions of francs)6: escudos) : Gold in bars 31,-007 29, 742 28, 588 Gold 921 921 920 Cash on hand and on current Other reserves (net) 356 419 456 account with banks 29, 480 42, 223 26, 582 N Lo o a n n -r s e a se n r d v e d i e s x c c o h u a n n ts ge 5 1 5 5 2 5 3 4 7 5 9 5 2 41 1 3 9 R Si e g d h i t s c fu o n u d n s t a a b t l e i n b t i e l r l e s s a t nd accept- 16, 270 16, 577 12, 980 Government debt 1,033 1,033 1,036 ances (at cost) :45,876 45,405 .77, 241 Other assets _ 1,628 1,532 1,250 Time funds at interest 21, 228 21,353 35, 627 Note circulation 2,704 2,593 2,230 Sundry bills and investments 209,195 211,062 229, 588 Other sight liabilities.— 938 1,004 1,040 Other assets 2,303 2,384 1,570 Other liabilities 1,003 1,140 1,024 Demand deposits (gold) 14,092 12,176 14,112 National Bank of Rumania (mil- Short-term deposits (various lions of lei): currencies): Gold 3 31, 747 31,606 20, 267 Central banks for own ac- Special exchange accounts __ 4,344 3,773 4,195 count _ 19, 820 30, 722 53,823 Loans and discounts 25,146 24,199 17, 930 Other 2,456 2,368 2,463 Special loans 4 881 884 1,441 Long-term deposits: Special ac- Government debt 7,959 7,958 10,183 counts __ 229,001 229,001 253, 512 Other liabilities 189, 990 194,479 188, 265 ' Revised. 1 Latest month for which report is available for this institution. 2 Figures not yet available. 3 Gold revalued on May 19,1940, at 0.0043 gram fine gold per leu. 4 Agricultural and urban loans in process of liquidation. s Gold revalued May 31,1940, at 0.2053 gram fine gold per franc. 6 See BULLETIN for December 1936, p. 1025. 1150 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

MONEY RATES IN FOREIGN COUNTRIES DISCOUNT RATES OF CENTRAL BANKS [Per cent per annum] b C an e k n tr of a — l R S 2 e a 8 p te t. ef D fec a t t i e ve b C an e k n t o r f a — l R S 2 e a 8 p te t. ef D fe a ct t i e ve b C an e k n t o r f a — l R S 2 e a 8 p te t. ef D fec a t t i e ve b C an e k n tr of a — l R S 2 e a 8 p te t. ef D fec a t t i e ve Albania Mar. 21, 1940 Ecuador May 26,1938 Lithuania July 15, 1939 Switzerland-__ Nov. 26, 1936 Argentina Mar. 1, 1936 El Salvador. __ Mar. 30,1939 Mexico Mar. 1, 1937Turkey July 1, 1938 Belgium Jan. 25, 1940 Estonia Oct. 1,1935 Netherlands._ Aug. 29, 1939United King- Bolivia Aug. 9, 1938 Finland Dec. 3,1934 New Zea- dom Oct. 26, 1939 British India- Nov. 28, 1935 France Jan. 4,1939 land May 27, 1940 U. S. S. R July 1, 1936 Bulgaria Aug. 15, 1935 Germany Apr. 9,1940 Norway May 13, 1940 Yugoslavia Feb. 1, 1935 Canada Mar. 11, 1935 Greece Jan. 4,1937 Peru Aug. 1, 1940 Chile 3-4^ Dec. 16, 1936Hungary Aug. 29,1935 Portugal 4-4^ Aug. 11, 1937 Colombia July 18, 1933Italy May 18,1936 Rumania ~* ' May 5, 1938 c Corrected. Czecho- Japan 3.29 Apr. 7,1936 South Africa.. May 15, 1933 i Not officially confirmed. slovakia Jan. 1, 1936Java 3 Jan. 14,1937 Spain iMar. 29,1939 Changes since Aug. 29: none. Denmark May 22, 1940 Latvia 5 Feb. 17,1940 Sweden May 17, 1940 OPEN MARKET RATES [Per cent per annum] Sweden United Kingdom (London) Germany (Berlin) Hungary (Stock- Switzerholm) land Month a 3 c B c a m e n p o k ta e n n r t s h c 1 e s s T m b re i o l a l n s s t , u h 3 r s y Da m y o -t n o e - y day o a n B l l d a o n e w p k a o e n s r c s it e ' s d P is r r c i a v o t a e u t n e t Da m y o -t n o e - y day c c i o a P m l r p i m m ap e e r e - r Da m y o -t n o e - y da y L 3 o a m n o s n u t p h s to d P is r r c i a v o te a u t n e t 1937—July .56 .53 .79 2.88 2.64 1.00 1938—July .55 .52 .75 2.93 2.96 1.00 1939—July .79 .77 .75 2.75 2.65 1.00 1939—No vember.. 1.96 1.18 1.00 2.65 2.19 2M-5 1.25 December.. 1.23 1.24 1.03 2.63 2.39 3-5 1.25 1940—January 1.10 1.09 1.02 2.50 2.03 3-5 1.25 February.._ 1.04 1.02 1.00 2.50 2.08 3-5 1.25 March 1.03 1.02 .99 2.50 2.16 3-5 1.25 April 1.03 1.03 1.00 2.38 1.90 3-5 1.25 May __. 1.03 1.02 1.00 2.38 1.98 1.41 June 1.03 1.02 1.00 3K-5K 1.50 July 1.03 1.02 1.00 3#5K 150 NOTE.—For back data, figures for other countries, and references to explanation of table see BULLETIN for September 1940, p. 1018. COMMERCIAL BANKS United Kingdom l Assets Liabilities (Fig p u o r u e n s d i s n s m te i r l l l i i n o g n ) s of re C se a r s v h es M c n a o s o l h n l t o e i a c r y n t e d at B co il u ls n d te is d - T r d e r e c e p e a o i s p u s t i r s t y 2 Se t c ie u s ri- L cu o s a e t n r o s s m to - O as t s h e e ts r Total D D e e m po a s n i d ts 3 Times lia O bi t l h i e ti r es 10 London clearing banks 1930—December 208 144 322 285 933 240 1,876 992 847 254 1931—D ecember 184 119 246 297 905 222 1,737 868 846 237 1932—December 207 127 408 472 778 208 1,983 991 963 216 1933—j) ecember 213 119 311 565 740 237 1,941 1,015 900 244 1934—D ecember 216 151 255 594 759 247 1,971 1,044 910 251 1935—December 221 159 322 605 784 231 2,091 1,140 924 231 1936—December 236 187 316 630 864 238 2,238 232 11 London clearing banks 5 1930—December 244 195 322 660 890 249 2,315 1,288 1,012 245 1937—December 244 163 300 635 984 256 2,330 1,284 1,026 252 1938—D ecember 243 160 250 635 971 263 2,254 1,256 997 269 1030 jnlv 235 155 278 597 986 251 2,240 1,241 999 263 August 233 148 279 599 990 270 2,245 1,239 1,007 273 September 268 146 236 603 1,016 276 2,278 1,272 1,006 266 October 256 159 289 605 1,020 271 2,327 1,299 1,028 272 November 245 142 353 611 1,000 242 2,345 1,303 1,042 248 December 274 174 334 609 1,015 290 2,441 1,398 1,043 256 1940—January 242 154 388 610 1,010 267 2,410 1,373 1,036 261 Februarv 247 149 353 609 1,007 259 2,366 1,347 1,019 258 March 249 142 336 611 1,014 273 2,363 1,355 1,008 260 April 254 153 338 618 991 260 2,354 1,351 1,003 261 May 257 144 409 633 972 260 2,413 1,382 1,031 261 June 270 166 384 636 983 295 2,469 1,443 1,026 264 July 262 146 415 26 658 940 271 2,454 264 1 Averages of weekly figures through August 1939; beginning September 1939 figures refer to one week near end of month. 2 Represents six-month loans to the Treasury at 1% per cent, callable by the banks in emergency under discount at the bank rate. 3 Through December 1937 excludes deposits in offices outside England and Wales, which are included in total. 4 Beginning 1936, figures on this basis available only for 11 banks—see footnote 5. 5 District Bank included beginning in 1936. NOTE.—For other back figures and explanation of tables see BULLETIN for October 1933, pp. 639-640. OCTOBER 1940 1151 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Commercial Banks—Continued Liabilities France (4 large b i a n n m ks i . l lio E n n s d o f o f f r m an o c n s t ) h figures Cash D b u a e n f k ro s m B co il u ls n t d e i d s- Loans O as t s h e e ts r Total D D e e p m o a s n it d s Time ac O c w ep n t- lia O b t i h li e t r i e ' s 1930—December. 2,419 4,675 20,448 10,743 2,361 36,681 35,284 1,397 921 4,357 1931—December. 11,311 2,168 18,441 9,274 2,130 38,245 37,023 1,222 576 4,503 1932—December. 9,007 1,766 22,014 7,850 1,749 37,759 36,491 1,268 295 4,331 1933—December. 5,870 1,416 19,848 8,309 1,827 32,635 31,773 862 273 4,362 1934—December. 1,421 18,304 8,159 1,717 30,943 30,039 904 193 4,301 1935—December.. 3,739 2,484 16,141 8,025 1,900 27,553 26,859 694 337 4,399 1936—December. 3,100 2,975 17,582 7,631 1,957 28,484 27,955 529 473 4,289 1937—December.. 3,403 4,116 18,249 7,624 2,134 30,348 29,748 600 661 4,517 1938—December.. 3,756 4,060 21,435 7,592 1,940 33,578 33,042 537 721 4,484 1939—March 3,604 3,519 23,945 6,654 1,310 34,793 34,127 667 541 April 3,522 3,745 25,667 6,414 1,353 36,368 35,700 667 558 3,775 May 5,148 3,769 25,102 7,061 1,409 38,120 37,444 676 519 3,849 June 3,538 3,857 25,263 1,472 36,231 35,547 684 486 3,951 July 3,464 3,580 25,717 6,850 1,532 36,650 35,991 659 430 4,063 August 6,357 3,718 18,784 7,353 1,674 33,293 32, 668 626 455 4,138 September. 5,062 3,862 20,888 7,710 1,735 34,642 34,048 594 427 4,190 October 4,534 3,698 23,170 7,809 1,936 36,285 35,675 610 534 4,328 November. 4,171 3,714 25,649 7,907 2,068 38,423 37,835 588 631 4,455 December.. 4,599 3,765 29,546 7,546 2,440 42,443 41,872 571 844 4,609 1940—January.... 4,066 4,080 29,808 7,756 1,745 42,850 42,302 548 938 3,667 February.. 4,293 3,993 30,810 7,579 1,849 43,737 43,195 542 1,034 3,753 March i___. 4,110 3,920 34,123 7,499 1,961 46, 608 46,064 544 1,105 3,901 Assets Liabilities Germany 2 (5 larg i e n b m an il k li s o . n s E o n f d r e o i f c h m sm on a t r h k s f ) igures re C se a r s v h es b f D a ro n u m k e s B co il u ls n t d e i d s- Loans Se ti c e u s ri- O as t s h e e ts r Total D D e e p m o a si n t d s Time o C b b f r t a r e a o n d i m k n i s t e s d l O ia t t i b h e i s e li r - 1930—November. 191 1,483 2,453 7,416 482 9,091 3,857 5,233 1,986 1,828 1931—November. 173 817 1,431 5,377 807 1,127 6,062 3,252 2,810 1,328 2,341 1932—November. 143 583 1,631 4,570 991 6,161 2,958 3,203 1,146 1,550 1933—November. 131 471 1,702 3,731 1,003 5,754 2,624 3,130 661 1,481 1934—November. 115 393 2,037 3,331 874 983 5,816 2,731 3,085 485 1,432 1935—November. 139 316 2,162 2,884 1,027 983 5,376 2,435 2,941 686 1,449 1936—November. 137 269 2,567 2,729 1,112 851 5,751 2,661 3,090 579 1,334 1937—November. 148 299 3,205 2,628 1,020 812 6,264 2,912 3,352 513 1,335 1938—August 199 255 3,589 2,731 1,098 844 6,933 3,219 3,714 416 1,368 September. 270 295 3,384 2,817 1,097 876 6,915 3,311 3,603 424 1,400 October.... 179 261 3,620 2,743 1,183 895 7,031 3,373 3,658 422 1,427 November. 195 270 3,643 2,685 1,406 893 7,234 3,531 3,703 420 1,438 1939—January... 184 285 3,934 2,708 1,178 895 7,334 3,619 3,716 414 1,436 February- 175 307 2,798 1,145 902 7,377 3,576 3,801 410 1,427 March 219 308 3,904 2,833 1,112 901 7,458 3,765 401 1,418 April 189 271 4,364 2,761 1,082 891 7,745 3,870 3,875 398 1,414 May 237 292 4,537 2,772 1,073 852 7,981 3,996 3,985 396 1,385 June 3 214 306 4,108 1,080 7,793 3,793 390 1,342 Assets Liabilities fi ( g 1 u 0 r e c s h i a n r t m er i e l d li o b n C a s n a o k n f s a C . d a a n E a n d d i a o n f d m ol o la n r t s h ) Ca E sh ntire S ly e c i u n r i C ty ana O l d o a t a h n e s r S a a n l e f b o d r d c r o a u u o m n e n r a s i e d t t y Securi- a O s t s h e e ts r ci N t r i c o o u t n l e a- D ad ep a o e s x it c s l u d p d e a p i y n o a g s b it l i s e n t i e n r b C an a k n- l O ia t b h i e li r reserves loans and dis- foreign Total Demand Time counts banks 1930—December.. 207 205 1,275 171 604 602 133 2,115 1,426 816 1931—December.. 201 135 1,253 146 694 510 129 2,058 1,360 752 1932—December.. 211 103 1,104 155 778 439 115 1,916 538 1,378 760 1933—December.- 197 106 1,036 134 861 432 121 1,920 563 1,357 725 1934—December.. 228 103 977 155 967 449 124 2,035 628 1,407 718 1935— December.. 228 83 945 141 1,155 485 111 2,180 694 1,486 745 1936—December.. 240 114 791 161 1,384 507 103 2,303 755 1,548 790 1937—December.. 255 76 862 102 1,411 510 96 2,335 752 1,583 785 1938—December.. 263 65 940 166 1,463 474 2,500 840 1,660 782 1939—July 266 51 947 202 1,520 468 2,520 822 1,697 849 August 265 49 957 245 1,507 461 2,524 822 1,702 873 September.. 279 51 1,020 214 1,502 475 2,583 891 1,692 862 October 304 53 1,083 209 1,662 474 2,837 1,128 1,709 858 November.. 295 56 1,102 157 1,665 475 2,809 1,074 1,735 851 December.. 292 53 1,088 132 1,646 490 2,774 1,033 1,741 842 1940—January 290 48 1,073 134 1,654 466 2,755 1,005 1,751 827 February... 273 57 1,104 140 1,638 476 2,772 1,113 1,659 829 March 265 52 1,115 166 1,599 451 2,724 1,063 1,661 836 April , 281 54 1,072 180 1,592 488 2,743 1,071 1,672 840 May - 300 44 1,063 194 1,617 475 2,785 1,142 1,643 818 June 272 39 1,067 184 1,583 469 2,706 1,098 1,609 814 July 277 39 1,053 166 1,576 454 2,674 1,062 1,613 802 i No figures available since March 1940. » Combined monthly balance sheets not published for December. Prior to merger of two of the banks in February 1932 figures refer to six large Berlin banks. Beginning in 1935 figures are not entirely comparable with those shown for previous years due to changes in reporting practice (see BULLETIN for June 1935, p. 389). jjgj s No figures available since June 1939. P NOTE.—For other back figures and explanation of tables see BULLETIN for August 1939, p. 699; June 1935, pp. 388-390; and October 1933, pp. 641-646. 1152 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

FOREIGN EXCHANGE RATES [Averages of certified noon buying rates in New York for cable transfers. In cents per unit of foreign currency] Year or month A t r i g n e a n- Off A i ( c p i u a o s l t u r n a d l F i ) a ree g B iu el m - O B f r f a ic z i i a l l (mi F lr r e e i e s) B ( I r n r u i d p ti i e s a e h ) g ( B l a e u r v i l a - ) C O a ff n ic a i d a a l (d F o r ll e a e r) Of C fi h ci i a le l ( E pe x s p o o ) rt S ( C y h h h u a a i a n i n ) n g a - C (p b o e l i s o a o m ) - ( s k C lo o z v r e u a c n k h a i o a ) - 72.801 337.07 17.900 •7.9630 31.816 1.0039 91. 959 7. 6787 28.598 81.697 3.8232 1934.. 33. 579 400.95 23.287 8.4268 37.879 1.2852 101.006 10.1452 34.094 61.780 4.2424 1935.. 32. 659 388.86 18.424 8.2947 36.964 1.2951 99.493 5.0833 36. 571 56.011 4.1642 33.137 395.94 16. 917 8. 6681 5.8788 37.523 1.2958 99. 913 5.1240 29.751 57.083 4.0078 1937-.. 32.959 393.94 16.876 8.6437 6.1983 37.326 1.2846 100.004 5.1697 4.0000 29.606 56. 726 3.4930 1938 32. 597 389. 55 16.894 5.8438 36. 592 1.2424 99.419 5.1716 4.0000 21.360 55.953 3.4674 1939 30.850 353.38 16.852 6.0027 5.1248 33.279 1.2111 96.018 5.1727 4.0000 11.879 57.061 3.4252 1939—Aug 31.116 367.32 16.968 6.0579 5.0236 34.407 1.2111 99.494 5.1691 4.0000 7.163 57.061 Sept 318.38 17.028 6.0594 5.0162 29.928 91.255 5.1776 4.0000 57.068 Oct 29.770 319. 51 16.729 6.0575 5.0503 30.296 89.331 5.1713 4.0000 7.638 57.151 Nov 29. 772 312. 66 16.490 6.0580 5.0322 30.127 87. 755 5.1714 4.0000 8.353 57.206 Dec 29.773 313.13 16. 577 6.0576 5.0263 30.032 87.615 5.1705 4.0000 7.487 57.022 1940—Jan 29. 772 315.82 16.834 6.0562 5.0132 30.140 88.018 5.1670 4.0000 7.833 57.205 Feb 29. 773 315. 79 16.859 6.0569 5.0237 30.163 86. 654 5.1655 4.0000 7.012 57.264 Mar 29.773 299. 50 16.980 6.0574 5.0269 30.179 90.909 82.883 5.1650 4.0000 6.409 67.130 April.... 29. 773 322.80 280.90 16. 891 6. 0576 5.0291 30.198 90.909 84.238 5.1649 4.0000 5.992 56.990 May 29. 773 322.80 260.80 16. 736 6.0488 5.0232 30.120 90.909 80.970 5.1670 4.0000 5.083 57.046 June 29. 773 322.80 287.04 6.0527 5.0329 30.106 90.909 80.072 5.1678 4.0000 5.760 57. 220 July 29. 773 322. 80 303.11 6. 0575 5.0259 30.149 90.909 86.924 5.1678 4.0000 6.048 57.096 Aug 29. 773 322.80 317.02 6.0575 5.0219 30.132 90.909 86.865 5.1680 4.0000 5.476 56. 985 Year or month ( m D kr a e o r n n k - e) (p E o g u y n p d t ) (m l F k a i a a n n ) r d - k- F (f r r a an n c c ) e ( m m r G e a a i e r c n r k h - y ) s- G (d m r r e a a e c ) c h e - (d H K o o o ll n n a g g r) (p H g e a u n r n g y o - ) ( I l t i a ra ly ) J ( a y p e a n n ) M (p e e x so ic ) o ( N g l u e a t i n l h d d e e s r r - ) Z (p e N o a e l u a w n n d d ) N (k o r r o w n a e) y 1933 19.071 434.39 1.8708 5.0313 30. 518 .7233 29.452 22.360 6. 7094 25. 646 28.103 51.721 340.00 21.429 1934 22. 500 516.85 2. 2277 6. 5688 39. 375 .9402 38. 716 29. 575 8. 5617 29. 715 27. 742 67.383 402.46 25.316 1935 21.883 502.60 2.1627 6. 6013 .9386 48.217 29.602 8.2471 28. 707 27.778 67.715 391. 26 24.627 1 1 1 19 9 9 9 3 3 3 37 9 6 8 . 2 2 2 2 1 2 0 2 . . . . 0 3 1 8 6 8 4 2 9 9 6 5 4 5 5 5 0 7 0 0 9 8 6 1 . . . . 8 9 3 6 3 2 0 8 2 2 2 1 . . . . 1 1 1 9 8 9 5 9 1 0 6 4 3 1 7 8 4 2 2 6 . . . . 0 1 8 5 1 4 1 7 4 6 0 8 1 0 3 1 4 4 4 4 4 0 0 0 0 0 . . . . . 0 1 2 2 2 6 6 9 0 5 1 4 7 4 8 . . . . 8 9 8 9 1 0 9 2 5 5 8 5 3 5 9 8 3 3 2 3 0 7 0 1 . . . . 7 6 4 4 1 9 5 5 1 4 4 7 2 1 1 1 9 9 9 9 . . . . 2 5 7 7 3 5 7 2 8 9 8 7 7 5 5 5 . . . . 1 2 2 2 9 6 6 9 5 0 0 1 9 5 7 6 2 2 2 2 8 8 5 9 . . . . 7 4 9 0 9 5 6 2 1 1 3 2 2 2 2 1 7 7 2 9 . . . . 7 1 3 7 0 5 2 6 3 0 2 0 6 5 5 5 4 5 3 5 . . . . 4 0 3 0 8 0 3 4 1 9 5 5 3 3 3 3 9 9 9 5 6 8 2 4 . . . . 9 3 8 9 2 5 2 1 2 2 2 24 3 4 4 . . . . 2 9 8 5 2 7 4 6 6 4 0 6 1939—Aug.. 20.834 472. 41 2.0456 2. 6137 39.859 .8520 28.213 19.576 5. 2515 26.870 16.800 53.484 368.82 23.376 Sept.. 19. 317 432.04 1.9000 2.2651 39. 864 .7575 24.863 5.1445 23. 459 19.023 53.182 319. 75 22.655 Oct... 19. 291 1.8943 2. 2736 40.092 .7345 25.030 5.0465 23. 510 20.151 53.115 320.81 22.697 Nov.. 19. 294 1.8964 2.2246 40.127 .7244 24.491 17.602 5.0444 23.440 20.497 53.080 313.96 22.703 Dec. 19.297 1.8136 2. 2269 40.097 .7157 24.482 17.600 5.0452 23.441 18.185 53.107 315.03 22.701 1940—Jan.... 19.304 1.8156 2. 2461 40.118 .7155 24.629 17.686 5.0470 23.438 16. 663 53. 208 317.09 22.706 Feb._. 19.310 1. 7078 2. 2459 40.117 .7176 24.572 17.605 5.0467 23.438 16. 654 53.137 317.06 22.709 Mar 19. 311 1. 5252 2.1296 40.114 .7007 23.247 17. 592 5.0470 23.438 16. 652 53.101 300.72 22.712 April.. 19.307 1. 7743 1.9980 40.115 .6546 21.834 17. 586 5.0452 23.438 16.656 53.082 282.05 22.707 May.. 1.8961 1.8516 40.025 .6270 20.288 17. 582 5.0426 23.438 16.654 53.079 261.87 June.. 1. 9776 2.0052 39.965 .6529 22.388 17. 591 5.0361 23.432 18.365 288.19 July.. 1. 9643 39. 978 .6654 23. 582 18.481 5.0323 23.432 19.913 304.32 Aug... 1. 9691 39.951 .6628 22. 510 19. 370 5.0334 23. 431 19.988 318. 25 Year or month P (z o l l o a t n y d ) ( P es o g c r a u t l d u o - ) R ( u n le m i u a ) a- (p S A o o fr u u i n t c h d a ) p S e p s a e i t n a) ( S S m d t e o r e t a l t n l l i a t e t s r s - ) ;k S d r w o e n n e a - ) S ( w f la r i a n t n z d e c r ) - ( T po u u rk nd ey ) U O n ff i i t c ( e i p d a o l K un in d g F ) d re o e m tr U C o o r ll u n e g - d uay N tr o ( o p n e l - l s c e o o d ) n- Y ( sl d a u i v g n i o a a - r) 1933.. 14. 414 3.9165 .7795 414.98 10.719 49.232 22.032 24.836 60.440 423.68 60.336 1.7607 1934.. 18. 846 4.6089 1.0006 498. 29 13.615 59.005 25.982 32. 366 79.047 503. 93 79. 956 2.2719 1935.. 18.882 4.4575 .9277 484.66 13. 678 57.173 25.271 32. 497 80.312 490.18 80. 251 2.2837 1936.. 18. 875 4. 5130 .7382 491. 65 12.314 58.258 25.626 30.189 80.357 497.09 79.874 2. 2965 1937.. 18.923 4.4792 .7294 489.62 6.053 57.973 25.487 22.938 80.130 494.40 79.072 2.3060 1938.. 18.860 4.4267 .7325 484.16 5.600 56.917 25.197 22.871 80.109 488.94 64.370 2.3115 1939.. 18.835 4.0375 .7111 440.17 10.148 51.736 23.991 22. 525 80.243 443. 54 62.011 36.789 2.2716 1939—Aug... 18.754 4. 2234 .7043 456.10 11.000 53.996 24.002 22. 573 80.022 461.07 2.2729 Sept... 3.6564 394. 57 10.492 46.712 23. 763 22. 576 79.500 399. 51 38.180 Oct... 3.6444 396.12 10.148 47.017 23.792 22.433 401.05 39.022 Nov... 3.6067 . 7088 397.15 10.039 46.246 23. 798 22.428 392.47 65.830 37.063 2.2649 Dec— 3. 6044 .7055 397.41 9.950 46.102 23. 796 22.422 393.01 65.830 36.457 2.2657 1940—Jan 3.6259 397.86 9.950 46.484 23.806 22.419 396.39 65.830 36.360 2.2595 Feb. 3. 6228 398. 00 9.950 46.483 23.807 22.418 396.34 65.830 37. 466 2.2560 Mar 3.4985 398.00 9.814 46.750 23.816 22.417 403. 50 375.91 65. 830 38.839 2. 2485 AApril _ 3.4090 398.00 9.144 47.136 23.691 22.418 403. 50 352. 59 65.830 39.090 2.2444 MMaayy _ 3. 2650 398.00 9.130 47.119 23. 791 22.253 403. 50 327.36 65.830 38. 603 2.2473 June 3. 398.00 9.130 47.114 23.804 22. 461 403. 50 360.16 65.830 37.714 2. 2441 July 3.8021 398.00 9.130 47.113 23.836 22. 684 403. 50 380.47 65.830 35. 956 2.2439 Aug 3.8311 398.00 9.130 47.116 23.813 22. 755 403. 50 397. 88 65. 830 34. 939 2.2436 NOTE.—Developments affecting averages since July 1940 have been as follows: Averages based on nominal quotations for at least 5 days a month as follows: Aug.—Germany, Italy, and Yugoslavia. For further information concerning nominal status of exchange quotations, special factors affecting the averages, and changes in the bases of quotation, see BULLETIN for September 1940, p. 1021; September 1939, p. 831; March 1939, p. 236; and March 1938, p. 244. OCTOBER 1940 1153 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

PRICE MOVEMENTS IN PRINCIPAL COUNTRIES WHOLESALE PRICES—ALL COMMODITIES [Index numbers] Year or month U S n ta i t t e e s d Canada K U in n g it d e o d m France Germany Italy (O Ja c p to a b n er N (1 l e 9 a t 2 n h 6 d e - s 3 r- 0 ( S Ju w l l a i y t n z 1 d e 9 r 1 - 4 (1926=100) (1926=100) (1930=100) (1913=100) (1913=100) (1928=100) 1900=100) =100) =100) 1926 ___ 100 100 U24 695 134 237 106 144 1929 95 96 627 137 95 220 100 141 1930— 86 87 100 554 125 85 181 90 126 1931 73 72 88 500 111 75 153 76 110 1932 _ 65 67 86 427 97 70 161 65 96 1933 66 67 86 398 93 63 180 63 91 1934 75 72 88 376 98 62 178 63 90 1935 _ 80 72 89 338 102 68 186 62 90 1936- 81 75 94 411 104 76 198 64 96 1937 86 85 109 581 106 89 238 76 111 1938 79 79 101 653 106 95 251 72 107 1939 77 75 103 »681 107 2 97 278 74 111 1939—July 75 73 98 678 107 96 270 70 107 August. _ __ 75 72 98 674 107 (3) 272 71 107 September 79 78 106 (4) 107 288 75 117 October. __ _ 79 79 111 107 293 81 120 November 79 80 119 107 300 84 123 December. __ _ 79 82 122 108 314 85 125 940—January 79 83 125 108 320 86 128 February 79 83 128 108 317 88 130 March 78 83 129 109 312 88 132 April 79 83 132 110 314 (5) 134 May 78 82 134 110 312 135 June._ 78 82 135 110 308 139 July 78 82 P140 111 306 141 August 77 ?140 111 306 p Preliminary. * Approximate figure, derived from old index (1913=100). 8 Average based on figures for 8 months for France, 7 months for Italy. * No figures available since July 1939. * No figures available since August 1939. 5 No figures available since March 1940. WHOLESALE PRICES—GROUPS OF COMMODITIES [Indexes for groups included in total index above] United States (1926=100) United Kingdom France (1913=100) Germany(1913=100) (1930=100) Year or month pr F o a d r u m cts Foods co O i m t t i h m e e s o r d- Foods p I r n o tr d d i u a u l s c - ts p an r F o d a d r f u m o c o t d s p I r n o tr d d ia u u l s c - ts p A r t g o u r d r i u c a u l ct l s - P s r io o n v s i- a t f r n I i i n n d a i d l s s h u e r e s a m d - w i- p tr I r i i n o s a d h d l u e u f d s c in - ts products 1926 . 100 100 100 581 793 129 132 130 150 1929 105 100 92 579 669 130 125 132 157 1930 88 91 85 100 100 526 579 113 113 120 150 1931 _ 65 75 75 89 87 542 464 104 96 103 136 1932 . 48 61 70 88 85 482 380 91 86 89 118 1933 51 61 71 83 87 420 380 87 75 88 113 1934 65 71 78 85 90 393 361 96 76 91 116 1935 79 84 78 87 90 327 348 102 84 92 119 1936 _ _ 81 82 80 92 96 426 397 105 86 94 121 1937 86 86 85 102 112 562 598 105 96 96 125 1938 69 74 82 97 104 641 663 106 91 94 126 1939 65 70 81 98 106 » 653 1 707 108 193 95 126 1939—July 63 68 80 91 102 629 721 109 92 95 126 August 61 67 80 90 102 616 726 109 92 95 126 September 69 75 82 101 108 108 95 126 October 67 73 84 109 111 108 96 126 November 67 72 84 114 121 108 97 126 December 68 72 84 118 124 108 97 127 1940—January 69 72 84 122 127 108 98 127 February 69 71 83 126 129 108 98 127 March 68 70 83 124 131 110 99 128 April 69 72 83 126 135 111 98 128 May 68 71 83 128 136 112 98 128 June 66 70 82 130 137 112 98 129 July 67 70 82 112 98 130 August 66 70 82 112 99 131 p Preliminary. i Average based on figures for 8 months. 1 No figures available since August 1939. Sources.—See BULLETIN for April 1937, p. 372; March 1937, p. 276; October 1935, p. 678; March 1935, p. 180; and March 1931, p. 159. 1154 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

Price Mtwements—Continued RETAIL FOOD PRICES COST OF LIVING [Index numbers] [Index numbers] Y m e o a n r t o h r ( S U 1 = t 9 n a 1 3 t i 0 5 t e 0 e - s 3 ) d 9 > (J U K u = d n l i 1 o y n i 0 m t l g e 9 0 - d 1 ) 4(J F = u r 1 t a y 0 n l 0 9 c ) 1 e 4 (1 = m G 9 1 1 a e 0 3 n r 0 - - y ) 14 N (1 = l e 9 a 1 t 1 n 0 h 1 d 0 e - s ) 1 r 3 - (J S e = u r w 1 n l 0 e a i l t 0 n 9 z ) d 1 - 4 Y m e o a n r t o h r ( S U = 1 t 9 n 1 a 3 0 t i 5 t e 0 e - s ) 3 d i 9 (J U = K u d n 1 l i y o 0 i n t l m 0 g 9 e ) - d 14 F = ( r 1 1 a 9 0 n 3 0 c 0 ) e ( = 1 m G 9 1 1 a e 0 3 n r 0 - - y ) 14 N (1 = l e a 9 1 t 1 n 0 h 1 d 0 e - ) s 1 r 3 - (J e = S u r 1 w n l 0 a e i 0 n t l9 z ) d - l4 1926 161 554 146 161 160 1926 170 142 168 162 1929 133 154 611 156 162 156 1929 123 164 154 168 161 1930 126 145 614 146 150 152 1930 - - 119 158 100 147 161 158 1931 104 131 611 131 136 141 1931 109 148 97 136 151 150 1932 87 126 536 116 119 125 1932 98 144 91 121 141 138 1933 84 120 491 113 120 117 1933 92 140 87 118 139 131 1934 94 122 481 118 124 115 1934 96 141 83 121 140 129 1935 100 125 423 120 118 114 1935 98 143 78 123 136 128 1936 101 130 470 122 120 120 1936 99 147 86 125 »132 130 1937 105 139 601 122 127 130 1937 103 154 102 125 137 137 1938 98 141 702 122 130 130 1938 101 156 117 126 139 137 1939 95 141 »742 123 130 132 1939 99 158 *122 126 140 138 1939-July 94 139 741 125 132 1939-July . 156 (8) 127 138 August 94 137 749 125 124 131 August -„ 155 127 137 137 September 98 138 (8) 122 128 133 September 101 155 126 139 138 October 98 154 122 133 136 October. _ 165 126 143 140 November 97 157 122 136 138 November 169 126 144 142 December 95 157 123 137 138 December 100 173 126 146 142 1940-January 95 157 124 138 139 1940-January 174 127 146 144 February.. 97 161 124 140 139 February 177 127 148 145 March 96 161 126 (7) 140 March 100 179 129 (7) 145 April 96 158 142 April . 178 ?129 147 May 97 159 143 May 180 ?130 148 June 98 158 145 June 101 181 P131 150 July 97 168 145 July 187 P132 151 August 96 August P185 i Revised series. Monthly data back to 1935 for retail foods and quarterly data back to 1933 for cost of living may be obtained from the Bureau of Labor Statistics. 3 Revised index from March 1936 (see BULLETIN for April 1937, p. 373). 3 Average based on figures for 8 months. * Average based on two quarterly quotations. 8 No figures available since May 1939. 9 No figures available since August 1939. 7 No figures available since February 1940. Sources.—See BULLETIN for October 1939, p. 943, and April 1937, p. 373. SECURITY PRICES [Index numbers except as otherwise specified] Bonds <Common stocks Year or month U St n a i t t e e s d K U in n g it d e o d m France Germany Nether- (1926=100) Nether- ( p a r v i e c r e a ) g l e ( 1 D 9 e 2 c 1 e = m 10 b 0 e ) r (1913=100) (a p v r e ic r e a ) ge lands « U St n a i t t e e s d K U in n g it d e o d m France Germany (19 l 3 a 0 n = d 1 s 00) Number of issues. _ 60 87 36 139 8 420 278 300 329 100 1926 — 97.6 110.0 57.4 100.0 100.0 100.0 100.0 1929 98.1 110.2 85.1 81.4 100.0 190.3 119.5 217.6 122.8 1930 99.3 111.8 95.8 83.3 104.3 149.8 102.6 187.6 100.2 100 1931 90.9 108.4 96.9 »83.4 104.1 94.7 78.9 132.2 3 78.0 70 1932 69.5 113.2 88.6 8 67.1 94.8 48.6 67.9 105.2 »50.3 46 1933 _._ 73.4 119.7 81.3 82.5 105.3 63.0 78.6 99.6 61.7 52 1934 84.5 127.5 82.1 90.7 113 4 72 4 85 7 83 3 71.1 55 1935 88.6 129.9 83.5 95.3 107.8 78.3 86.3 79.7 82.9 55 1936 97.5 131.2 76.3 95.8 109.1 111.0 97.0 77.2 91.6 66 1937 93.4 124.6 75.1 98.7 4 101.8 111.8 96.3 97.4 102.6 104 1938 78.9 121.3 77.3 99.9 105.9 83.3 80.8 89.7 100.1 96 1939 . 81.6 112.3 5 84.9 99.0 90.9 89.2 75.9 6 98.2 94.1 90 1939—July 81.6 112.5 84.3 99.0 94.4 86.1 75.8 100.4 91.7 89.3 August 81.0 110.9 82.9 99.0 92.6 86.3 75.3 94.0 93.2 88.6 September.. 80.9 106.9 98.9 79.6 92.4 72.0 92.8 92.1 October 82.9 109.5 98.9 80.3 95.3 74.9 92.3 87.7 November- 83 0 112 3 99 0 80 9 94 2 76 0 94 5 85 8 December _ 82.1 112.4 99.0 77.2 91.8 75.7 97.8 84.3 1940—January 82.4 117.6 99.1 77.9 92.7 75.7 101.0 85.4 February 82.2 119.9 99.6 76.7 91.5 77.1 103.1 84.7 March _ 82.1 119.8 99.9 76.4 91 5 77.9 106.6 85.7 April 82.5 119.4 100.2 92.9 77.4 109.3 May 79.4 116.8 100.7 83.0 73.1 112.2 June _ _ 78.5 113.4 100.8 73.3 64.9 112.6 July 81.2 116.4 76.1 63.5 August. 81.5 77.5 * Prices derived from average yields for 60 corporate bonds as published by Standard Statistics Co. a Indexes of reciprocals of average yields. For old index, 1929-1936, 1929=100; average yield in base year was 4.57 per cent. For new index beginning January 1937, January-March 1937=100; average yield in base period was 3.39 per cent. 8 Exchange closed from July 13 to Sept. 2, 1931, and from Sept. 19, 1931, to Apr. 11,1932. Index for 1931 represents average of months January, June; index for 1932 represents average of months May-December. 4 New index. See note 2. 6 Average based on figures for 8 months. 8No figures available since August 1939. 7 No figures available since March 1940. Sources—See BULLETIN for November 1937, p. 1172; July 1937, p. 698; April 1937, p. 373; June 1935, p. 394; and February 1932, p. 121. OCTOBER 1940 1155 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

'Tedetal Publication* Copies of the publications and releases listed below may be obtained from Board of Governors of the Federal Reserve System, Washington, D. C. CURRENT RELEASES BOOKS AND PAMPHLETS DAILY (Partial List) Foreign Exchange Rates (for previous day) THE FEDERAL RESERVE SYSTEM—ITS PURPOSES AND FUNCTIONS. Obtainable in cloth binding at 50 cents a copy and in paper cover without charge. 128 pages. WEEKLY A set of FEDERAL RESERVE CHARTS ON BANK Monday: CREDIT, MONEY RATES, AND BUSINESS has been pub- Condition of Reporting Member Banks in 101 lished by the Board and is for sale to the public at Leading Cities 50 cents a copy. Data available as of June 14, 1940, Bank Debits are plotted on the latest edition. Tuesday: Money Rates—Open-Market Rates in New York DIGEST OP RULINGS—from 1914 to October 1, 1937. Digests of rulings of Board; compilation showing City textual changes made in the Federal Reserve Act; Wednesday: digests of court decisions and opinions of the At- Weekly Review of Periodicals torney General involving a construction of the Fed- Thursday: eral Reserve Act; and digests of court decisions in- Condition of Federal Reserve Banks volving Federal Reserve Banks. Price $1.25 per Condition of Reporting Member Banks in New copy. 683 pages. York City and Chicago (Also a part of statement of Condition of Reporting Member Banks PROBLEMS OF BANKING AND BANK SUPERVISION. in 101 Leading Cities released on following Excerpts from the 1938 Annual Report of the Board Monday) of Governors of the Federal Reserve System. 33 Friday: pages. Department Store Sales MONETARY MEASURES AND OBJECTIVES. Three statements by the Board on objectives of monetary policy, MONTHLY on proposals to maintain prices at fixed levels through monetary action, and on legislative proposals relat- Federal Reserve Bulletin—released about the 4th ing to monetary measures and objectives. 8 pages. of the month (subscription price $2.00 per July 1937, April 1939, and May 1939. annum, single copies 20 cents; outside of the United States, Canada, Mexico, and the insular THE HISTORY OP RESERVE REQUIREMENTS FOR possessions, annual subscription $2.60, single BANKS IN THE UNITED STATES. Legislation, designacopies 25 cents) tion of reserve cities, and changes in the reserve posi- Federal Reserve Inter-District Collection System tion of banks. 20 pages. November 1938. (Par List)—including list of State bank mem- SUPPLY AND USE OP MEMBER BANK RESERVE bers. Semi-annual issues, January-July, and FUNDS. Explanation of analysis of sources of memmonthly supplements—released about 7th of the ber bank reserve funds and uses to which such funds month are put as indicated by Federal Reserve and Treas- National Summary of Business Conditions—re- ury statements. 31 pages. July 1935. leased about the 16th of the month ANALYSES OF THE BANKING STRUCTURE—As of Business Indexes—released about the 16th of the December 31, 1935. Number, deposits, and loans and month investments of banks classified by size of bank and Bank Debits—released between the 6th and 12th town and by other factors. 33 pages. of the month THE PAR COLLECTION SYSTEM OF THE FEDERAL Foreign Exchange Rates—released about the 1st RESERVE BANKS, by George B. Vest—reprint of of the month article, 8 pages, February 1940. Money Rates—released about the 3rd of the month THE BANKS AND IDLE MONEY, by Woodlief Thomas —reprint of article, 9 pages, March 1940. QUARTERLY CHEAP MONEY AND THE FEDERAL RESERVE SYSTEM, Member Bank Call Report (3 or 4 times a year by E. A. Goldenweiser—reprint of article, 5 pages, depending upon number of calls for condition May 1940. reports) List of Stocks Registered on National Securities OWNERSHIP AND UTILIZATION OF THE MONETARY Exchanges. Issued annually in February with GOLD STOCK—Reprint of article, 3 pages, May and quarterly supplements (subscription price 25 June 1940. cents for the List and three supplements; five or NEW FEDERAL RESERVE INDEX OF INDUSTRIAL PROmore copies on one order, 20 cents per copy; fifty DUCTION—Reprint of article, 77 pages, August 1940. or more copies on one order, 15 cents per copy.) MEASUERMENT OF PRODUCTION—Reprint of article, 16 pages, September 1940. ANNUALLY GOLD RESERVES OF CENTRAL BANKS AND GOVERN- Bank Debits—released ordinarily in February MENTS—Reprint of article, 18 pages, September Annual Report (covers calendar year) 1940. 1156 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

BOARD OF GOVERNORS OF THE FEDERAL RESERVE SYSTEM MARRINER S. ECCLES, Chairman RONALD RANSOM, Vice Chairman M. S. SZYMCZAK CHESTER C. DAVIS JOHN K. MCKEE ERNEST G. DRAPER LAWRENCE CLAYTON, Assistant to the Chairman ELLIOTT THURSTON, Special Assistant to the Chairman CHESTER MORRILL, Secretary LlSTON P. BETHEA, Assistant Secretary S. R. CARPENTER, Assistant Secretary FRED A. NELSON, Assistant Secretary WALTER WYATT, General Counsel J. P. DREIBELBIS, Assistant General Counsel GEORGE B. VEST, Assistant General Counsel B. MAGRUDER WINGFIELD, Assistant General Counsel E. A. GOLDENWEISER, Director, Division of Research and Statistics WOODLIEF THOMAS, Assistant Director, Division of Research and Statistics LEO H. PAULGER, Chief, Division of Examinations R. F. LEONARD, Assistant Chief, Division of Examinations C. E. CAGLE, Assistant Chief, Division of Examinations EDWARD L. SMEAD, Chief, Division of Bank Operations J. R. VAN FOSSEN, Assistant Chief, Division of Bank Operations J. E. HORBETT, Assistant Chief, Division of Bank Operations CARL E. PARRY, Chief, Division of Security Loans PHILIP E. BRADLEY, Assistant Chief, Division of Security Loans 0. E. FOULK, Fiscal Agent JOSEPHINE E. LALLY, Deputy Fiscal Agent FEDERAL OPEN MARKET COMMITTEE FEDERAL ADVISORY COUNCIL MARRINER S. ECCLES, Chairman Boston District THOMAS M. STEELE GEORGE L. HARRISON, Vice Chairman New York District LEON FRASER CHESTER C. DAVIS Philadelphia District HOWARD A. LOEB WILLIAM A. DAY Vice President ERNEST G. DRAPER Cleveland District B. G. HUNTINGTON JOHN K. MCKEE Richmond District ROBERT M. HANES ROBERT S. PARKER RONALD RANSOM Atlanta District RYBURN G. CLAY GEORGE J. SCHALLER Chicago District EDWARD E. BROWN JOHN S. SINCLAIR President M. S. SZYMCZAK St. Louis District S. E. RAGLAND Minneapolis District JOHN CROSBY CHESTER MORRILL, Secretary S. R. CARPENTER, Assistant Secretary Kansas City District JOHN EVANS WALTER WYATT, General Counsel Dallas District R. E. HARDING J. P. DREIBELBIS, Assistant General Counsel San Francisco District PAUL S. DICK E. A. GOLDENWEISER, Economist JOHN H. WILLIAMS, Associate Economist R. G. ROUSE, Manager of System Open Market Account WALTER LICHTENSTEIN, Secretary 1157 OCTOBER 1940 Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

CHAIRMEN, DEPUTY CHAIRMEN, AND SENIOR OFFICERS OF FEDERAL RESERVE BANKS Federal Chairman and Reserve Federal Reserve Deputy Chairman President First Vice President Vice Presidents Bank of— Agent Boston Frederic H. Curtiss... Henry S. Dennison..^. Roy A. Young William W. Paddock William Willetti New York Owen D. Young Beardsley Ruml George L. Harrison Allan Sproul Ray M. Gidney L. Werner Knoke Walter S. Logan Leslie R. Rounds Robert G. Rouse John H. Williams Philadelphia... Thomas B. McCabe.. Alfred H. Williams..._ John S. Sinclair Frank J. Drinnen W. John Davis Clarence A. Mcllhennyz Cleveland. George C. Brainard... Reynold E. Klages Matthew J. Fleming Frank J. Zurlinden _ William H. Fletcher William F. Taylor * George H. Wagner Richmond Robert Lassiter William G. Wysor Hugh Leach John S. Walden, Jr John G. Fry George H. Keesee * Atlanta Frank H. Neely Joe Frank Porter Robert S. Parker William S. McLarin, Jr... Malcolm H. Bryan Harry F. Conniff Chicago Robert E. Wood Frank J. Lewis George J. Schaller Howard P. Preston James H. Dillard William H. Snyder 2 Clifford S. Young St. Louis William T. Nardin.... Oscar G. Johnston William McC. Martin.. F. GuyHitt Olin M. Attebery Clarence M. Stewart 1 Minneapolis. __Walter C. Coffey. Roger B. Shepard John N. Peyton... _ Oliver S. Powell Ernest W. Swanson Harry I. Ziemer 2 Kansas City... Robert B. Caldwell... John J. Thomas George H. Hamilton Carroll A. Worthington.. James W. Helm 2 Harold G. Leedy Dallas James H. Merritt Jay Taylor Robert R. Gilbert Ethan B. Stroud _ Robert B. Coleman Walter 0. Ford 1 San Francisco.. Raymond C. Force St. George Holden William A. Day. Ira Clerk Cecil E. Earhart 1 William TVT TTftl« Richard B. West 1 Cashier. 2 Also cashier. MANAGING DIRECTORS OF BRANCHES OF FEDERAL RESERVE BANKS Federal Reserve Bank of— Managing Director Federal Reserve Bank of— Managing Director New York: Minneapolis: Buffalo Branch Robert M. O'Hara Helena Branch.. Robert E. Towle Cleveland: Kansas City: Cincinnati Branch Benedict J. Lazar Denver Branch Joseph E. Olson Pittsburgh Branch.. Percy A. Brown Oklahoma City Branch.. George H. Pipkin Richmond* Omaha Branch Lloyd H. Earhart Baltimore Branch. W. Robert Milford Dallas: Charlotte Branch William T. Clements El Paso Branch Joseph L. Hermann Atlanta: Houston Branch William D. Gentry Birmingham Branch Paul L. T. Beavers San Antonio Branch Miers Crump Jacksonville Branch _ George S. Vardeman, Jr. San Francisco: Nashville Branch . Joel B. Fort, Jr. Los Angeles Branch _ W. Norman Ambrose New Orleans Branch Lewis M. Clark Portland Branch David L. Davis Chicago: Salt Lake City Branch Winnie L. Partner Detroit Branch Seattle Branch. _ Clarence R. Shaw St.[ Louis: Little Rock Branch . Arthur F. Bailey Louisville Branch . _ _ Charles A. Schacht Memphis Branch William H. Glasgow 1158 FEDERAL RESERVE BULLETIN Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis

o w M FEDERAL RESERVE DISTRICTS CO o V ! L • MM BOUNDARIES OF FEDERAL RESERVE DISTRICTS . — — BOUNDARIES OF FEDERAL RESERVE BRANCH TERRITORIES (APPROXIMATE IN THE ST. LOUIS DISTRICT) ® FEDERAL RESERVE BANK CITIES • FEDERAL RESERVE BRANCH CITIES O FEDERAL RESERVE BANK AGENCY This map incorporates recent intra-district transfers of territory described in the Bulletin for August 1940 on page 778. OX CO Digitized for FRASER http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis