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CASH: : Fed Branch Is the Greenest Spot in L.A.

December 17, 1990|JANE APPLEGATE | TIMES STAFF WRITER

Most of California's 11,000 ATMs are in Southern California. By comparison, there are only about 6,250 machines in all of New York state, according to David Robertson, vice president of the Nilson Report, a Santa Monica-based newsletter for executives in the credit card and electronic banking industry.

In the first six months of this year, the Fed's New York bank took in $18.2 billion, compared to $16.4 billion processed by Los Angeles. Although the amounts are comparable, there was a big difference in how much the Fed branches paid out. The New York Fed disbursed $9 billion more than it collected, while the Los Angeles branch showed a cash surplus of $2.2 billion, according to Federal Reserve figures.

The cash surplus is believed to reflect Southern California's thriving underground economy, including the drug money and flight capital from abroad. New York, on the other hand, functions as the nation's sole supplier of U.S. currency to foreign banks, according to a Fed spokesman.

The casually dressed Fed employees who work in pairs in the quiet, temperature-controlled basement don't concern themselves with where the money is coming from. Working in pairs and rotating through the cash-counting jobs, their motto is: "I watch you, and you watch me," according to Mark Fishback, vice president of operations at the Los Angeles Fed.

Each day, workers process 8,200 bundles of notes, each 2.2-pound bundle containing 1,000 notes.

"There are so many checks and balances here, it gives you a true sense of security," said Fishback. "There is a zero loss. We do not lose any money we handle."

The vault, which spans about one-third of an acre, contains $4 billion to $7 billion in cash. Plexiglas cubes, the size of industrial washing machines, each contain up to $42 million.

About 30% of the money moving through the system is destroyed each day. Athough a $20 or $50 bill might remain in circulation for years, the average life span of a $1 bill is a mere 18 months.

Because the paper used to make currency cannot be recycled, old bills are shredded into a confetti-like material, compressed into briquettes similar in size to the charcoal used in a back-yard barbecue and trucked to landfills for disposal.

PERCENTAGE GROWTH IN FEDERAL RESERVE CASH SURPLUSES, 1985-1988 Miami: -24.5% Nashville: +20.7% Jacksonville: +57.1% San Antonio: +58.5% El Paso: +66.6% Denver: +88.7% Salt Lake City: +142.3% Helena: +179.4% New Orleans: +680.7% Los Angeles: +2,192.2% Source: Federal Reserve System

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