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SCHEDULE 33.—Funds paid out and received through gold settlement fund during year 1918.

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SCHEDULE 34.-Statement showing, by months, the gold settlement fund settlements and resultant balances, both debit and credit, for year 1918.

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SCHEDULE 35.-Statement showing amount of currency and coin shipped to member banks, by months, during 1918, detailed as to nature and denomination.

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SCHEDULE 35.-Statement showing amount of currency and coin shipped to member banks, by months, during 1918, detailed as to nature and denomination-Continued.

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DISTRICT NO. 12.-SAN FRANCISCO.

JOHN PERRIN, Chairman and Federal Reserve Agent.

FINANCIAL RESULTS OF OPERATIONS.

COMPARATIVE STATEMENT.

The expansion of the Federal Reserve Bank of San Francisco during the period from April 6, 1917, when the United States declared war, to December 31, 1918, is shown in the comparative statement in Schedule 1. Deposits of member banks have increased from $38,497,162 to $73,235,000; bills discounted for member banks from $340,372 on April 6, 1917, to $25,780,201 on December 31, 1917, and to $78,759,000 on December 31, 1918; gold reserves from $41,030,130 on April 6, 1917, to $94,018,470 on December 31, 1917, and to $150,973,000 on December 31, 1918; Federal Reserve note circulation from $15,398,695 on April 6, 1917, to $67,744,305 on December 31, 1917, and to $212,243,000 on December 31, 1918.

EARNINGS, EXPENSES, AND DIVIDENDS.

Net earnings of $547,043.86 in 1917 rose to $2,869,164.14 in 1918. Dividends at the rate of 6 per cent per annum for the period January 1, 1917, to December 31, 1918, were paid, amounting to $497,674.40, and $2,448,175.11 credited, half to surplus account and half to the United States Government as a franchise tax. A comparative statement of earnings and expenses is given in Schedule 2.

GENERAL BUSINESS CONDITIONS.

Unprecedented agricultural, commercial, and industrial activity, with equally unprecedented profits, has prevailed throughout this district during the war, the largest industrial development having been in shipbuilding. Of 408 ships, aggregating 2,376,362 tons deadweight, built and delivered to the United States Shipping Board between August, 1917, and October 1, 1918, 162, of 1,149,685 tons, were built in this district, the estimated value of ships produced on the Pacific coast during 1918 being over $500,000,000. In spite of the armistice, steel shipbuilding is proceeding at an undiminished pace, but wood shipbuilding has practically ceased for the time being.

Agriculture remains the principal industry of the district, produetion during the war having been increased to some extent by urgent need and high prices. The Department of Agriculture estimates the value of the agricultural products of this district during 1918 at $851,427,000, as compared with $822,579,000 in 1917. That this increased value is partly the result of increased yield is evidenced by the following examples: In this district production of wheat totaled 79,584,000 bushels as compared with 70,899,000 bushels in 1917; of sugar beets more than 2,600,000 tons, as compared with 2,400,000 in 1917; of California rice approximately 400,000,000 pounds, as compared with 280,000,000 in 1917; of beans in California 8,868,000 bushels as compared with 8,091,000 in 1917; the area planted to cotton in Arizona 92,000 acres, as compared with 46,000 in 1917, and in California 194,000, as compared with 117,000 in 1917. Shipments of California deciduous fruits totaled 28,204 cars, as compared with 24,961 in 1917.

The year has been generally favorable for agricultural products, shown in the comparative statement of production in Schedules 3, 4, and 5.

The salmon pack of the Pacific Northwest is estimated at 9,300,000 cases, which is approximately 825,000 less than in 1917. The southern California fish pack, chiefly of tuna and sardines, was 52,000 cases in excess of the 1917 pack, amounting this year to 1,075,000 cases.

Change in statistical methods makes accurate comparison of changes in stored stocks of California petroleum impossible. Stored stocks, which on December 31, 1917, totaled 30,450,465 barrels, were reported on October 31, 1918, as 37,400,859. This increase is due almost entirely to exclusion of refinery stocks from the former figures and their inclusion in the latter, production having approximated consumption. Stored stocks, exclusive of refinery stocks, amounted on December 31, 1915, to 57,147,051 barrels and on December 31, 1916, to 44,036,190 barrels.

The lumber situation has been exceptionally complex, due to labor problems, changed character of demands, car shortage, and the uncertainty regarding wooden ships. However, the volume of production and of consumption has been practically normal. Following the signing of the armistice, all Government lumber contracts were canceled, causing temporarily upset conditions, but as the year closes the situation is favorable.

Labor has been fully employed at an unprecedently high level of wages. There has been some agitation and dissatisfaction, but labor disturbances have been at a minimum during the year.

Building permits throughout the district have shown a decided decrease, due to the request of the Government that all unnecessary building be postponed until after the termination of the war.

Bank clearings have ranged between 25 per cent and 30 per cent in excess of those of 1917. Import and export trade, in spite of shortage of shipping space, is at record point in values. Washington (Seattle and Tacoma) foreign trade exceeds that of California (San Francisco and Los Angeles), the totals for the first 10 months of 1918 amounting to $493,393,000 and $404,333,000, respectively. Imports and exports from Oregon ports totaled $12,784,000.

Comparative statements of building permits, bank clearings, and foreign trade are given in Schedules 6 to 8.

Money rates have been stable, there being a steady and active demand, with rates firm at 6 per cent in industrial centers and 7 per cent in agricultural communities.

DISCOUNT OPERATIONS.

REDISCOUNTS-COMMERCIAL PAPER.

Discounts which, during 1916, aggregated $1,973,355 expanded to a total of $102,981,205 during 1917 and $941,441,337 during 1918. Rediscounts of commercial paper exceeded discounts of collateral notes during the major portion of the year. Holdings of such rediscounts increased from $24,211,000 on January 1 to $34,326,000 on July 5, the first date on which they exceeded $30,000,000. They reached their peak, $49,152,000, on September 13, after which date they gradually decreased, amounting on November 30 to $30,038,000 and on December 31 to $33,732,000. Particular assistance was granted in the Northwest in handling the grain crop and the wool clip. A steadily growing tendency to offer short maturities has been manifested.

REDISCOUNTS-LIBERTY LOANS.

Holdings of member banks' notes, practically all secured by Government obligations, totaled $2,533,000 on January 1. These gradually increased until on April 26 the amount held reached $10,904,000, the daily holdings fluctuating during the succeeding months between $10,000,000 and $20,000,000, reaching $22,299,000 on August 2 and increasing from that date until October 10, when they were $61,561,000. Following the close of the fourth Liberty loan campaign, holdings of such paper gradually declined, amounting to $44,136,000 on November 30 and $45,027,000 on December 31.

TRADE ACCEPTANCES.

There has been increased interest in trade acceptances and their volume is expanding, several conventions of retail and wholesale dealers and various credit men's associations on the Pacific coast having indorsed their use. Chambers of commerce and associations of merchants have made greater efforts than bankers to secure their adoption.

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