Blend together 1/3 cup sugar, milk, egg and melted shortening.
Sift flour, baking powder, salt and nutmeg together.
Add to liquid mixture and stir slightly.
Mix in raisins.
Drop by heaping teaspoonsful into hot shortening.
Fry until golden brown.
Drain on paper towels.
Mix 1/4 cup sugar and cinnamon in bag.
Shake warm doughnuts in bag to coat with sugar.
Makes 2 3/4 dozen.