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Treasury Goes High-Tech With Redesigned $100 Bills
Hugh Pickens writes "AP reports that as part of an effort to stay ahead of counterfeiters, the Department of the Treasury has designed a high-tech makeover of the $100 bill with a disappearing Liberty Bell in an inkwell and a bright blue security ribbon composed of thousands of tiny lenses that magnify objects in mysterious ways. The new blue security ribbon will give a 3-D effect to the micro-images that the thousands of lenses will be magnifying. Tilt the note back and forth and you will see tiny bells on the ribbon change to 100s as they move. Tilt the note side to side and the images will move up and down."
No RFID tag?
Tin foil wallet at the ready!
AT&ROFLMAO
pffft. put out a press release when you join the 20th century...
http://www.questacon.edu.au/indepth/clever/plastic_banknotes.html
Wait! Whats a sig?
If I were a counterfeiter, I'd make only $5 and $10. Sure, it'd be less cost effective, since the cost of printing a $1 or $100 is the same, but no one would suspect my bills are fake.
The idea behind making it hard to reproduce federal reserve notes is to keep counterfeiters from robbing us by expanding the money supply, but the Fed does exactly that on a scale that no independent counterfeiter could even imagine.
-jcr
The only title of honor that a tyrant can grant is "Enemy of the State."
Where can I get free samples of this new product?
Presumably to amplify the smoke and mirrors used by the Fed to make it appear the bills are actually worth anything.
The Free Competition in Currency Act and Federal Reserve Transparency Act are good places to start. Talk to your congressman today and ask them to sober up.
Peter
Downsize DC Today!
Funny how the process of counterfeiting -- injecting paper money into the economy with nothing of actual value to back it up -- is exactly the same as what government does to cause inflation. The result? The criminal (er, government) holds more money, at the expense of everybody else whose dollars are now worth less.
Of course, when you're at the top of the pyramid, your actions are sacred rather than criminal.
Are they also Green? (Or will I be inhaling toxic combustion products when I use them to light up my Cuban cigars?)
Free, as in your money being freed from the confines of your account.
...that mimics the virtue it symbolises.
I like the idea of "greenbacks" and IMHO the standout colors are distracting and "busy".
Question: Is there something about the color blue that makes the security ribbon harder to counterfeit than if it were, for example, silver or green?
I can already envision all kinds of geeks staring at it with a microscope, dropping odd fluids on it, etc, in labs across the world. Really, I don't understand how paper money still exists.
Build your own energy sources from scratch. http://otherpower.com/
There's really no excuse for this. The bills should have different color and size to help the visually impaired. There's no good reason not to. Sure, don't change the $1 due to bill readers. I suppose there are $5/$10/$20 readers, though usually at the post office (and hence easy to change from the government's perspective). But really -- why not mix up the $50 and $100 so that they're easier for those with disabilities to use. It'd at least be a step in the right direction.
Support a few technologists in Washington.
that the $100 bills stay in circulation much longer than smaller bills. they are exchanged much less frequently. I recently sold something fairly expensive and was paid in cash. the $100 bills in the wad were from 3 different generations of the bill! i suspect that in under the radar circles like gun shows and flea markets, the bills tend to be older.
When Australia switched to the new plastic money, we changed over from old $100 to new $100 (for example) in a short space of time.
Although I guess the total number of AU$100 bills in circulation worldwide is a LOT less than the total number of US$100 bills :)
Local Exchange Trading Systems (LETS) also known as LETSystems are local, non-profit exchange networks in which goods and services can be traded without the need for printed currency. In some places, e.g. Toronto, the scheme has been called the Local Employment and Trading System.
Build your own energy sources from scratch. http://otherpower.com/
I always thought counterfeiting was the only crime that made any sense. Nobody gets hurt, there's no violence involved. You just make it and spend it.
That's probably why the G takes it so seriously. When they catch counterfeiters, they put them under the prison.
You are welcome on my lawn.
Anyone know if they've released an update patch yet? I wish they would've warned me before my $100 went obsolete.
(My school subsidizes the Fundamentals of Engineering exam, which was last weekend, otherwise no I wouldn't have a $100 on me).
My webcomic
UK resident here. I personally love it when new technology is introduced into banknotes, but those plastic ones the Australians have had for ages are just plain cool.
The Indonesian plastic Rp100,000 note is also pretty damned cool.
Wish we had 'em.
Oh man, the North Koreans are going to be pissed!
I'll make me some money the old fashion way.
Ways to spot the bills printed by AC in his Mom's basement:
1. One Hundred Dollars reads One Hunnert Dollars
B. The United States of America reads The Untied State of America
Third. The phrase "Haulin' Ass and Gettin' Paid" does not actually appear on legitimate US currency.
If Slashdot were chemistry it would look like this:Cadaverine
Charlie Eppes has it covered, see Season 1 Episode 7 of 13 Counterfeit Reality
Is that a roll of $5 coins in your pocket, or are you just happy to see me?
I am officially gone from
Given that the world's highest denomination banknote is for €500 the same amount of effort that goes into forging an old $100 piece of paper gives higher returns with higher value notes. All this new tech in ther 100USD will do is make the baddies concentrate more on easier notes, it won't actuallt stop counterfeiting.
politicians are like babies' nappies: they should both be changed regularly and for the same reasons
All older bills are valid until they wear out. In other words; this is a pointless exercise unless they set an expiry date for older bills.
Most US $100 notes are circulated outside of the US. I don't know the percentage, but it's very high. Aside from legal users, there is a lot of people with large caches of $100 notes that our government doesn't like.
In non-US countries the the phrase "legal tender for all debts public and private" carries no weight. They can be picky about what notes they accept. Every time that new US notes are issued, people with large hoards of US cash find that their old notes are no longer accepted and they have to scramble to get new notes. They get noticed.
A dollar today has the buying power of 6 in 1940. But don't take my word for it, here's one of many inflation calculators http://www.coinnews.net/tools/cpi-inflation-calculator/
Can you imagine your grandparents carrying a wallet stuffed with 5 notes? Or a pocket full of .06 coins?
Time to get rid of them. Time to stop wasting 100s of millions of dollars every year printing and minting them.
Damn slashdot swallowed my cent characters. Hey slashdot, it's 2010, can't we join the 21st century and allow ISO8859-1 characters?
A dollar today has the buying power of 6 cents in 1940. But don't take my word for it, here's one of many inflation calculators http://www.coinnews.net/tools/cpi-inflation-calculator/ [coinnews.net]
Can you imagine your grandparents carrying a wallet stuffed with 5 cent notes? Or a pocket full of .06 coins?
Time to get rid of them. Time to stop wasting 100s of millions of dollars every year printing and minting them.
Long term it'll save lost of money.
Yeah, that's what happens to all my coinage too.
Report to Econ 101 please.
The damage from counterfeiting is inflation. Therefore, counterfeiting is a crime whose damage is divided among all individuals who are holding cash, or who are holding dollar-denominated assets at a fixed interest rate.
That the damage to each victim is very small is a secondary issue that perhaps could be considered at sentencing time.
FATMOUSE + YOU = FATMOUSE
In many other countries, the bank notes are different sizes, and the designs are completely revised every few years. Somehow, the ATMs and bill-counters don't have to be replaced. Probably because they don't rely on 1950s mechanical technology. Even so, it's not hard.As long as the treasury lets it be known that more and more bills will change size, the ATM manufacturers will account for this in new models. Old ATMs will be restricted to handing out the "old size" notes - no problem, because when you administer an ATM, you can decide what bank notes it hands out. By the time all of the bills have been modernized, the ATMs will have been replaced anyway. Seriously, the bills in the US are terrible from an accessibility point of view.
Enjoy life! This is not a dress rehearsal.
Not really. Just makes gold seem very expensive.
$10.000 (as in 10.000 pesos :-D )
;-)
We have that 3D stripe in out new (bicentennial) 10.000 chilean pesos bill, and the optical effect is amazing.
You can really see the images form some milimiters deep in the bill.
Nice to see the US is catching up with technology
The Treasury acts like counterfeiting is a great threat to the value of the dollar, when the Federal Reserve and the US government are the greatest threat. The dollar is fiat currency, and with the recession, there's NOTHING behind it-- yet Congress keeps spending. They just don't like the competition from the counterfeiters.
Gamingmuseum.com: Give your 3D accelerator a rest.
Maybe we will get lucky and if the Treasury keeps putting high tech processing into the bills they may actually end up being worth their face value.
Oh man, the North Koreans are going to be pissed!
North Korea prefers Euros.
Yes, people still use cash. In fact, it's all I use. Why would I work to enrich the credit card companies and banks, contributing to their usury, when I can just use cash and be done with it? Besides, it's a hell of a lot more difficult to have your credit card or debit card double-swiped or read by a tampered-with machine when you don't actually use it anywhere. Lastly, cash makes it *far* easier to track and control spending, which is a very good thing if you want to actually, you know, operate under a controlled budget.
Did they release the complete specs? we can have open source project for that.
"The changes are aimed at thwarting counterfeiters who are armed with ever-more sophisticated computers, scanners and color copiers."
...cashiers will still swipe it with that special marker pen.
#naabhaprzrag, #sverubfr-000, #agi-fcbafberq, negvpyr[pynff*=' negvpyr-ary-'] { qvfcynl: abar !vzcbegnag; }
I find it strange that US notes do not make provision for blind users. The notes are all the same size, which is totally retarded.
Excuse me, but please get off my Pennisetum Clandestinum, eh!
The damage from counterfeiting is inflation. Therefore, counterfeiting is a crime whose damage is divided among all individuals who are holding cash, or who are holding dollar-denominated assets at a fixed interest rate.
That the damage to each victim is very small is a secondary issue that perhaps could be considered at sentencing time.
Which is why HR1206 and S604 are essential beginnings to end the reign of the largest counterfeiter and thief of American wealth, The Federal Reserve.
Being a spelling & grammar Nazi is a sign you do not poses the intelligence to contribute to the conversation
Pity I dno't use my friends...
Best Slashdot Co
The problem with indicting the Fed is this: as the amount of wealth in our society grows, so must the amount of money grow. Otherwise money will be constantly deflating, which is a Bad Thing because it rewards people for sitting on their cash.
Now perhaps we can argue whether the money supply should be grown by the Fed, or by private banks, or by whoever... but the fact remains: we must inflate our currency at about the same rate that we increase our ongoing wealth. Somebody's gotta do it. But not counterfeiters, not for personal gain.
FATMOUSE + YOU = FATMOUSE
|| So, are you saying that Henry Paulson and Ben Bernanke should be arrested? ||
He might not be saying so directly. However, Henry and Ben being arrested would be a good start, I think.
I've been spending hundreds since they had small faces.
Nobody gets hurt, there's no violence involved.
Counterfeiting reduces the trust people have in the money.
Counterfeiting? I thought it was government.
There's no place like
Sir, I simply cannot condone your inconsistent numbering scheme. The correct order is 1, B, Fourth, Delta, ... You were really close, but need to learn the pattern better.
Report to Econ 101 please.
The damage from counterfeiting is inflation. Therefore, counterfeiting is a crime whose damage is divided among all individuals who are holding cash, or who are holding dollar-denominated assets at a fixed interest rate.
That the damage to each victim is very small is a secondary issue that perhaps could be considered at sentencing time.
Fine. We'll take the small inflation done by the counterfeiter, and multiply it times the 300,000,000 people he affected in the US. ;)
There's no place like
I can't wait for H.R. 1206 to pass. A Syrian democracy will do wonders for the federal reserve system. You probably meant H.R. 1207, apparently a companion bill to S. 604 Hope that helps some readers.
The problem with indicting the Fed is this: as the amount of wealth in our society grows, so must the amount of money grow. Otherwise money will be constantly deflating, which is a Bad Thing because it rewards people for sitting on their cash
The other bad thing is that if the fed didn't keep screwing around with the money and causing inflation, the gold I own wouldn't be worth more and more just by sitting on it.
(And don't be pedantic--I know the gold isn't actually worth more itself--just worth more in comparison to the US dollar as it plummets down the drain...)
There's no place like
Third. The phrase "Haulin' Ass and Gettin' Paid" does not actually appear on legitimate US currency.
But it sure as hell would be cooler than that generic and boring "In God We Trust". Hell, every denomination should have its own tagline. Like "Payin' to Play" on the 20 and "Don't Forget to Tip" on the 1.
"If a nation expects to be ignorant and free in a state of civilization, it expects what never was and never will be."
I don't think "counterfeit" and "thief" mean what you think they mean.
Right you are, silly fat fingers, thanks for the correction.
Being a spelling & grammar Nazi is a sign you do not poses the intelligence to contribute to the conversation
Don't forget to multiply by the number of counterfeiters!
This is your mindset. I see cash as expendable, and I'm hesitant to swipe a card knowing that I'll have to pay the bill later. Although if one has the mindset of the US government, maybe they don't mind swiping that card knowing full well they'll never pay it back.
The damage from counterfeiting is inflation.
Inflation—more generally, any increase in the supply of any good leading to its devaluation—is not damage. Everyone has a right to their dollars, but, as with any good, no one has a right to receive any specific price for those dollars in the marketplace.
The problem is that people, with the strong encouragement of governments, insist on treating as a stable store of value objects which have essentially no direct use valued in proportional to the price paid for them, not even as raw material, and which thus only command a nonzero price due to the artificial scarcity granted them via enforcement of anti-counterfeiting laws and restraint on the part of the Treasury (as limited as that may be...).
"The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
This is a very rash generalization. Using your philosophy, we can just leave monetary policy in the hands of frauds who can track your every move, tell you what you should or shouldn't spend your money on and make sure that it's reported it to them properly, else they'll through you in jail.
The thing is if you have a fairly low "floor limit" then it makes getting robbed a whole lot less likely
I used to work for a place that anything bigger than a ten got dropped into the safe as soon as possible (gas station) also it was policy that if you had more than a hundred dollars in your drawer you did a safe drop.
Now flat refusing to take a $50 (or $100) is a subset of that (personally i would have gone ahead and taken it if it wasn't a fire on the spot offense).
Any person using FTFY or editing my postings agrees to a US$50.00 charge
Well obviously you are right that for some people cash only is the best way for them to control spending. My point though is that anyone with a bit of self control is benefited by using a credit card for all their transactions.
Yeah, I'm just not convinced that's true, though. Even if you are extremely disciplined, the benefit of fixed-cash-pool budgeting is that your expenditures are 100% predictable every single month. As a result, you can maximize savings and debt repayment because you know precisely what your monthly cashflow will be like.
That said, it really is a matter of taste in the end. I like my system because it's extremely fixed and regimented. X dollars comes in, Y dollars go out in fixed expenses, Z dollars (divided up into pools) are allocated for discretionary spending, and W dollars goes to various savings (general savings, emergency fund, end-of-year taxes, etc). Simple, easy to understand, and above all, predictable.
but of course not every method is good for every person ymmv.
And on that, I think we can definitely agree. :)
in the fake world of cash printing and market manipulation real money of-course is this, accept no substitutes (and by the way, it has the security features built right into the atomic structure.)
You can't handle the truth.
There is NO DIFFERENCE whether it is the Fed, who inflates the value of money or some Joe Schmoe in his basement.
None whatsoever except this: Fed prints money and gives it to preferred corporations, who in turn get the free money and inflate economic bubbles, gamble with the money, create derivatives and generally do bad things (tm) and they use these free money to buy the politicians who will never stop the Fed.
If it is just Joe Schmoe printing the money, well :) Schmoe gets the first byte, money still gets inflated, but at least he does not use these money to buy T-Bills at a higher return rate than what the Fed is giving out the cash at.
It is insane that money supply is government controlled, it is the essence of corruption in the entire political system.
Now, if money was real, they wouldn't be able to print it, that's why they got off the gold standard in the first place - can't print gold.
In Hong-Kong the money is issued by private companies, there is competition between different currencies and the government cannot be quite AS corrupt as governments of countries that have the monopoly on money supply.
You can't handle the truth.
. . . if they aren't going to recall all the existing $100s in circulation and declare them worthless and no longer legal tender as of some date certain? If the current ones are easier to counterfeit, why wouldn't the counterfeiters just keep counterfeiting those?
One CPU cycle wasted on digital restrictions management is ONE TOO MANY.
I think the blind community has been asking for braille on notes for years now. You make a new bill, you can add braille insets to it. The little additions are nice but not to persons that can't see them to begin with.
Custom electronics and digital signage for your business: www.evcircuits.com
Google "Don't crucify me on a cross of gold" to find out the real story on why everybody abandoned the gold standard.
In a nutshell: the gold (or silver or whatever) standard only works if the supply of gold keeps pace with the growth of total social wealth. If it doesn't, then money deflates, and deflation is a perverse incentive (it causes people to sit on their cash as an 'investment'). Low inflation is best, but that means that we'd have to dig gold faster then we grow everything else.
Digging that much gold was possible in the olden days, when the economy grew at a snail's pace and the amount of gold in circulation was not already collossal. But nowadays... can you imagine how much gold you would have to find, in order to increase the total world supply of gold by 3% per year?
FATMOUSE + YOU = FATMOUSE
While I'm all for protecting the currency from counterfeiters, doesn't there come a point where the 58th measure taken on these bills (vs. just say, 57) is no longer helpful due to human nature/laziness?
How many people here check EVERY $100 they receive for EVERY watermark or other countermeasure on these bills?
I seriously doubt that if I walk into a Home Depot or Wal-Mart with $1000 in cash to buy something that they're going to check EVERY countermeasure. I'll be lucky if they pull out a black pen or do a cursory scan of each bill...
Admittedly, maybe banks check every bill they receive with some high-tech equipment I'm not aware of for every countermeasure automatically, but back at the cash register, haven't we painted the bills enough different colors?
But what will I do with all the hundreds I have stashed in the mattress?
Why, without your clothes, you're naked, Miss Dudley!
Was also thinking that that was quite apropos!
One CPU cycle wasted on digital restrictions management is ONE TOO MANY.
Exactly. Oh, you meant get a record of your own transactions--yeah, that too :).
One CPU cycle wasted on digital restrictions management is ONE TOO MANY.
A one-hundred dollar 'note' that promises to give you another one-hundred dollar 'note' in exchange is no note. It is a self-referential monstrosity. The wording "THIS NOTE IS LEGAL TENDER FOR ALL DEBTS, PUBLIC AND PRIVATE" that appears on it is an insider joke at the expense of the schmucks who accept them.
Those who would give up essential liberty to purchase a little temporary safety, deserve neither liberty nor safety.
100$ bills are waaaay easier to counterfeit. Why?
Cause you can still print the same 100s from 20, 30, 50 years ago. Old 100s are still legal tender.
All dollar bills are the same size, shape and color so you can bleach "smaller" bills and reprint them.
And as you still need dollar currency to buy oil - they are much more common around the world than any other currency.
Euros on the other hand have a varying size, color palette, and until this 100$ bill came out - better anti-counterfeiting measures.
Mit der Dummheit kämpfen Götter selbst vergebens
Just don't use your laser printer. Your serial number is printed in encoded yellow dots on every page: http://www.pcworld.com/article/118664/government_uses_color_laser_printer_technology_to_track_documents.html
Wouldn't that just equal the original dollar amount of what was counterfeited and put into circulation?
Do you believe that the total global social wealth has an exponential growth rate of 3% annually and will continue to do so until the end of time?
Check out my lame java blog at www.javachopshop.com
Wouldn't it make sense for a counterfeiter to try to fake older generation currency without the modern security features? It would still be accepted as legal tender.
I fail to understand why the US has been so sluggish in taking any useful measures to prevent counterfeiting of currency. For instance, it is typical for other nations to use plastic instead of paper, which severely limits the range of techniques available to the forger while offering a wide range of security features. The US treasury's practice of clinging to that same murky-green ink on paper for all dnominations is absurd if not downright stupid.
N/p. Just trying to save people some time looking since I started out really confused and worried for a minute about what federal reserve rider was hiding in the depths of H.R. 1206!
Except that the Fed pays its profits back to the U.S. Treasury. So provided you like any of the services the federal government provides, the Fed's actions help to pay for them. A counterfeiter only benefits himself/herself.
"The universe seems neither benign nor hostile, merely indifferent." --Carl Sagan
What profits? Where are these mythical, mystical profits? Who is paying them back? The free money, it's FREE money, do you not see that there are no profits in giving away free 0% interest money?
It's insane, they print free money, give it to the banks and banks buy from the Gov't long term money at about 4% - T-Bills. What are the profits are you talking about, it's a negative effect all around.
You can't handle the truth.
... dispose of all of your old $100 bills for a nominal fee. Just bundle them up and ship them to me.
Have gnu, will travel.
Or at least make use of a limited window of time when lots of people know that there is a new bill design coming, but few people have actually seen one. Perhaps the counterfeiters should just make something up; their design might be better than the feds and gain more acceptance.
Nullius in verba
Gold standard does not require you to increase supplies infinitely to cover inflation, it only requires that you hold the gold to cover your obligations. So if the supply is not increasing, but the demand is, all it means that your current supply has increased in total value.
However, and more importantly, inflation in itself is a concept that is created by the money printing press. Printing money does not equal economic growth, it only equals more cash in hands, but if the purchase power is falling (due to the same inflation) then what is the argument?
The prices for food seem stable in the US and the world due to Richard Nixon's intervention, who basically introduced policy of price fixing, but this too will pass, it can't last.
AFAIC the food related health problems of today (obesity, cholesterol, blood pressure, heart problems, diabetes, hypertension) are the payment for the cheap mass produced food, this is NOT free. The food has to become cheaper so that it seems that the prices stay stable, however in reality the food is getting cheaper by using cheaper ingredients and processes, that end up destroying the health of people and of the land. This is NOT free.
There is no free lunch, there is no such thing as price fixing without paying for it somehow anyway.
There is no such thing as government creating wealth, thus government has no business in economy and printing money.
Gold is the true money, so are some other metals. You can't forge them (well, it's easy to discover), they are what they are and the real prices of real things stay constant in terms of gold while the purchase power of money is constantly going down.
So I am in the camp of sound money, of government being removed from controlling economy, money supply, from government being removed, because in my opinion it is causing immeasurable destruction. AFAIC the government issuing free money and being corrupt is the cause of the economic collapse.
I WELCOME the collapse if it means collapse of this current system.
You can't handle the truth.
As usual, the voids working registers at discount stores and fast food "restaurants" will refuse the new "counterfeit" bills because they don't follow the news and the months of notice leading up to the release of redesigned currency.
The Christian Right is Neither (Christian nor right). See: Matthew 23, Matthew 25, Ezekiel 16:48-50
Inflation is a desirable practice precisely because it discourages people from treating their dollars as a stable store of value.
Desirable to who? Certainly not those currently holding dollars, who would prefer that their currency increase in value. If someone else would prefer less valuable dollars, and has the capacity to achieve this by creating more, fine—as I said, inflation is not damage; I have no problem with increases in the supply of fiat currency. Those who wish to avoid the effects should choose a more stable store of value.
Obviously this means I am opposed to forcing anyone to use fiat currency, as was done by President Roosevelt under Executive Order 6102 and the Gold Reserve Act of 1934, in which the federal government confiscated privately-owned gold coin, bullion, and certificates and made ownership of and trade in gold illegal until the Act was repealed by President Ford after 1974.
However, should public monetary policy really be motivated by a desire to enrich some (mainly borrowers) entirely at the expense of others (potential lenders)? If so, why?
P.S. In a deflationary economy, "hoarding" currency is a real investment, in the same way that "hoarding" collectibles which one expects to increase in value is an investment. It increases net wealth through saving—present production financing future, not present, consumption—which is the only means of doing so aside from unpredictable technological windfalls. The fear surrounding currency deflation is irrational.
Meanwhile, counterfeiting is wrong because it is the use of inflation for personal private gain.
And other increases in the supply of goods leading to their devaluation—such as production in general—aren't "for personal private gain"? If I manufacture a bolt (for example) then I inflate the supply of bolts, leading to a small but real decrease in the value of (at least) all compatible bolts held by others. Manufacture of this bolt is motivated by profit: my own personal, private gain. Is this wrong? If so, why? If not, why does your answer change after substituting "twenty-dollar bill" for "bolt"?
If counterfeiting is wrong because it inflates the supply of currency, then production in general is also wrong, as it inflates the supply of the goods produced. There is absolutely no difference.
"The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
You know the govt probably wants pretty badly to RFID all currency. Would make it trivial for police to know how much cash you've got on you from a distance.
Here's my simple theory:
Americans travel very little to other countries, and are therefore very rarely exposed to other currencies. When you've never seen any alternatives, you're very reluctant to change what you have.
So the treasury is very slowly introducing slightly colored bills, over the last decade. There's some grumbling, but it's being accepted. This will solve the problem of having to read to know your bill.
Different sizes, dollar coins or plastic bills will probably not come around for a long time.
People are generally against change. If you forced different sized bills on people they'd get used to this in a month or so and wonder why they ever cared in the first place.
Britain didn't change to a decimalised currency until the 1970's. Were people against it? Some were. In the 90's the 5p and 10p and 50p coins were shrunk. People objected to that as well. Nobody would want to change back though.
There wouldn't be a pressing need to change the existing bills. They're locked in a vault somewhere. They're not going to be used in a local shop where the owners rarely see $100 bills. They'll be sent to the US government who are quite capable of telling you whether they're faked or not and have a database of bills in circulation.
Borrowing from the Fed is 0.75%, while 4 week Treasury bills are 0.15% (1 year are 0.4%).
The Fed manipulates interbank interest rates (the Fed Funds Rate) by buying Treasury securities itself. It owns a lot of them, actually. So when the Treasury (that is, the U.S. taxpayer) has to pay interest on those Treasury securities, that money ends up right back at the Treasury.
But the basic premise is yes, the Fed creates money. But who effectively "gets" that money is not banks but the U.S. taxpayer (because at least most of the time direct borrowing from the Fed is quite low, and the Fed mostly buys and sells U.S. Treasuries).
"The universe seems neither benign nor hostile, merely indifferent." --Carl Sagan
While at the bank, pick up some $2 bills - they are lots of fun too!
They take up half as much space in the wallet as an equal value of $1 bills.
You could even track them via the http://wheresgeorge.com/ website - there seem to be a bunch of people who specialize in $2 bills, called "Top Toms" at http://www.primereloading.com/z/toptoms.htm
If you are going to claim that a government agency is defrauding you,
The "Federal" Reserve is NOT a government agency: it's a public-private partnership. The Senate confirms the board of govenors. Member banks own the Federal Reserve's stock, and earn 6% per year return. It wasn't until the 1960's that excess profits were turned over to the Department of the Treasury.
Nothing good comes from letting private banks create the money supply.
Learn the rules so you know how to break them properly.
www.teslabox.com
True story. I'd be surprised if the rest of the world hasn't figured out that the majority of the US public are too dim to realize if something is a benefit if it has the slightest hint of inconvenience.
If you can't see the value in jet powered ants you should turn in your nerd card. - Dunbal (464142)
Oh, and here are the profits.
"The universe seems neither benign nor hostile, merely indifferent." --Carl Sagan
But 10-30 year T-Bills are around 4-5%, and because the money that the Fed gives out to the banks is at near 0% (and you are right, the discount rate was increased by a quarter of a percentage point about a month ago) it just makes sense to take all of that cash and then buy those long term bonds, hoarding them.
The next bubble is in T-Bills, that's a certainty. However T-Bills is equivalent to cash, it's just a bit longer term cash than dollars.
Also the Fed does not create value, it only prints cash and T-bills, it creates inflation, not value. All of the manipulations by the Fed can only make the bad situation worse, people should understand that US dollar, while rallying for the past three months (it seems on the back of Euro) is eventually going to collapse because it is after all just dead paper with no backing and no trade surplus and a huge debt. Get out of USD if you are holding them in the bank.
You can't handle the truth.
When economists say save more i believe that it's implied "save more in a bank/investment"
That's different than socking it away because financial institutions can do things with it in the meantime and you earn interest.
Could be wrong.
If you can't see the value in jet powered ants you should turn in your nerd card. - Dunbal (464142)
this just makes me laugh. Sure, waste a trillion on bailouts (you know, more are coming), waste trillions on wars that are pure profit for corporations but also are pure debt to the US citizens and declare a profit with the banks, who just got a bailout, without which they just would have collapsed.
It's the same as banks declaring they have enormous earnings and are giving out billions in bonuses, when in reality it is not earnings, it's on the backs of US citizens now, it's theft.
US government pretends it 'earned' money, the banks pretend they 'earned' money and US government pretends that the economy is going up because GDP is going up - a 'jobless recovery', what a gyp.
There will be more bailouts coming once one of the 30 'essential' financial institutions collapses and takes down every other bank with it due to leverage and under the table derivatives, and the governments are going to collapse the currencies of the state because they are free to print them and they will do so spiraling into government created hyper-inflation. This has happened only at least a dozen times in the past 100 years, it's coming on a larger scale now.
You can't handle the truth.
The banks are paying back the "bailout money" left and right, with interest. Even GM has paid back quite a bit on its loans. "Of the $245 billion invested in U.S. banks, over $169 billion has been paid back, including $13.7 billion in dividends, interest and other income, along with $4 billion in warrant proceeds as of April 2010."
"The universe seems neither benign nor hostile, merely indifferent." --Carl Sagan
But you can't borrow from the Fed at 0.75% for 10-30 years! The discount window short term.
"The universe seems neither benign nor hostile, merely indifferent." --Carl Sagan
yeah, something to the tune of about 5% was repaid, just in time for the bonus time, to be able to take those bonuses without any attempt from the gov't to claw any of the money back. Purely a PR move. Call me when you get your trillion back from them.
You can't handle the truth.
but you can take cash, buy T-Bills and resell them quickly for a profit.
You can't handle the truth.
Wow, no. How can you buy t-bills for lower than what you sell them for? The buyers can just go straight to the source to buy them.
"The universe seems neither benign nor hostile, merely indifferent." --Carl Sagan
You can because you are a preferred corporations who is getting a ridiculously low interest rate on the cash that you are paying for the T-Bills. All you need to do is sell them to someone who is not getting the same interest rate for the short money - cash, and then make a percent or two in profit. Wow, what a concept.
You can't handle the truth.
Don't ask me, I have no self-moderation.
Where the money comes from is irrelevant for this point. At the end of the sale, the "preferred corporation" ends up with cash - exactly where it started before it purchases the t-bill. The point is that the price of that t-bill is the same for both the "preferred corporation" and everybody else. There's no profit if you sell the t-bill for exactly what you paid for it.
"The universe seems neither benign nor hostile, merely indifferent." --Carl Sagan
No no no, you sell them at higher prices of course, through bidding wars. The reason why you can get them in the first place is because of the free money that is given to you, and so you buy huge amounts with discounts. Discounts are the key and you get discounts by having lots of money. Free money.
You can't handle the truth.
Neither inflation nor deflation have that motivation, because interest rates on loans always take account of the inflation/deflation rate and so neither lender nor borrower is enriched. That is why everybody gets angry when the inflation/deflation deviates from whatever is normal: because the deviation makes the loan harder or easier to repay than what was planned.
Agreed.
Well, I think the fear surrounding deflation stems from what I said earlier: all current loans and bonds are written with ~2% inflation in mind. If they had been written in a deflationary economy, then lenders would fear inflation.
That said, I disagree with your claim that hording currency increases net wealth, because the inflation-driven alternative to hoarding is not pure consumption; rather, it is investing (including bank savings accounts, which are just fronts for stocks and bonds).
Yes it is, but it is gain accomplished by the creation of new wealth. Whereas a counterfeiter produces no wealth to offset the inflation he causes. And anyway, we are talking about devaluation of dollars, not of comparable goods; in this sense, production causes deflation, which is why fiat currency is more efficient than gold when your society's production rate varies over time.
As I said above, a paper bill has no utility, whereas a bolt does. Do you not see the difference? Or have you come up with a marvelous new use for small green pieces of fabric?
FATMOUSE + YOU = FATMOUSE
[citation needed]
"The universe seems neither benign nor hostile, merely indifferent." --Carl Sagan
it is called competitive bids, and preferred corporations get preferred treatment in every way, from getting free money to getting cheaper T-Bills. Then, of-course, you can bid on the T-Bills if you are a foreign entity through a bidding house, which would sell to you whatever it is that is for sale either by government or by private institutions. Good luck getting the real price, you'll always pay more.
You can't handle the truth.
Wouldn't that just equal the original dollar amount of what was counterfeited and put into circulation?
I wasn't talking about a monetary value. The GP said we should consider the /damage/ to each victim. Sure, there's a monetary value to that roughly equal to the amount counterfeited, but there's also the erosion of confidence in the dollar, and funding for the manpower to protect the dollar. If you get a really good lawyer, you can also get money for the emotional pain and suffering everyone felt because of the lost value of the dollar. ;)
There's no place like
what you're forgetting is choice, when one makes a decision to put something outt here, one will see the choice people choose; no debate will solve anything beacuse its only 2 parties with 2 different perceptions.
When the government finally decides to go through with this, it isnt going to be overnight, firstly they will give plenty of time for manufacturers and owners to upgrade facilities, they will then start using dual tender, slowly reduce the amount of old tender and over the period of 10-20 years slowly phase out the old notes. then people will be used to the new notes and not notice the changes.
It's not a typo if you understood the meaning!
If it looks like a Euro.. and it smells like a Euro... it is probably just as worthless as a Euro ;-)
FragHARD or don't frag at all
Neither inflation nor deflation have that motivation, because interest rates on loans always take account of the inflation/deflation rate and so neither lender nor borrower is enriched.
Sure, so long as the rate of change is constant, and ownership of alternatives to the fiat currency is not prohibited. In that case, of course, the inflation need have no effect at all, since you can trivially compensate for it by adjusting interest rates and buying non-inflationary assets (read: gold) rather than retaining dollars. As such, why not make things much simpler for everyone and just do away with it?
In practice, of course, just measuring even the past rate of inflation is extremely difficult—just look at how how CPI has been continually redefined over the years, such that one cannot directly compare recent CPI figures with historical ones to get an idea of the actual rate of change over time. The present rate of inflation is essentially unknowable, and you can't compensate for what you don't know. Moreover, if you're trying to match inflation to "creation of new wealth" then you're not even trying to hold the inflation rate constant; frequent transient variations are to be expected, so only long-term loans can really be adjusted to compensate based on a predicted average rate.
This is putting aside the fact that the Treasury mainly prints new money to finance federal debt, making inflation a form of hidden tax on currency.
Yes it is, but it is gain accomplished by the creation of new wealth. Whereas a counterfeiter produces no wealth to offset the inflation he causes.
Production of non-currency goods creates non-currency with no increase in currency, and thus devalues the goods produced while fulfilling the demand for said goods (creating wealth). Production of currency (counterfeiting or legal printing) creates currency with no increase in non-currency, and thus devalues the currency while fulfilling the demand for it (also creating wealth). The situations are symmetric.
As I said above, a paper bill has no utility, whereas a bolt does. Do you not see the difference? Or have you come up with a marvelous new use for small green pieces of fabric?
Utility is in the eye of the beholder (or in this case, owner). Subjectively, those "small green pieces of fabric" have utility to me so long as others are willing to accept them in exchange for other goods, which is why I accept them myself. Objectively, as with any other good, the utility (value) of currency is defined by the demand for it, and you can hardly claim that there is no demand for currency. Any other measure is subjective, and thus meaningless in this context.
Use as a medium for indirect exchange is a perfectly valid form of utility, BTW, even by utilitarian standards. Indirect exchange depends on a medium (currency), and creates wealth relative to direct exchange by allowing transactions which would otherwise not occur.
Overproduction would not create wealth, but counterfeiting is not overproduction: it only occurs because there is more demand for currency than there is supply. The problem is that those in power want to keep it this way, rather than allow supply and demand to come into balance, because fiat currency (unlike commodity currencies, e.g. gold) has a natural price approaching zero. If supply were permitted to rise to match demand people would migrate to another currency—one the politicians can't control so easily.
"The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
The best reason to use a credit card is that there are federal protections on credit cards that do not apply to cash. For instance, if you are mugged and promptly notify your CC company that your credit card was stolen, you cannot be held liable for more than $50 of charges to the card by criminals, by federal law. But if you are mugged and they take your cash, it's gone.
Build a man a fire, he's warm for one night. Set him on fire, and he's warm for the rest of his life.
This is common in NYC. Here MCDonalds, Wendy'ses, a subway clerk wont accept 50s or 100s. A subway clerk wont accept pennies, by MTA edict. A local East Asian market wont accept charges for less than "$10," flouting city and CC co. law, a common occurrence. In NYC you can't have and will be laughed at for _inquiring_ whether soda refills are free at a fast food hamburger place, common practice in most of the USA.
Then work for 'em, boy.
The three laws of thermodynamics:(1) You can't win. (2) You can't break even. (3) You can't even quit.
Bulls***! Money only has indirect utility, and it only has that because somebody is out there manufacturing bolts.
Or to put it another way: The bolt-maker doesn't need money to exist, but the money-printer needs bolts to exist. A society can survive without money; adding money serves to lower transaction costs but does not, itself, enrich anyone. If a tribe had zero wealth then it would not need money, nor would it acquire any wealth by printing it.
That is so, but counterfeiters do not serve that purpose once a tribe has already converted to fiat currency. The addition of counterfeit money does not lower transaction costs; in fact it RAISES them, because now all traders must expend effort to validate the currency they recieve.
There is NO demand for counterfeit currency, and everyone rejects it as soon as they become aware of it. You say that counterfeiters are responding to a demand for more currency, yet in today's inflationary climate (in which currency is slightly oversupplied) we see counterfeiters operating nonetheless, which means there is an error in your line of reasoning.
FATMOUSE + YOU = FATMOUSE
Money only has indirect utility, and it only has that because somebody is out there manufacturing bolts.
You might as well say that the bolts only have indirect utility in that others are manufacturing things to be fastened together. In what way would a lone bolt have any direct utility, after all?
Currency is a complementary good. It requires other goods to be useful, yes, but that is no different from many other goods and does not detract from its utility.
If a tribe had zero wealth then it would not need money, nor would it acquire any wealth by printing it.
Yes, and if a tribe had nothing to assemble it would not need bolts, nor would it acquire any wealth by producing them. Currency derives its value from the need for a medium of indirect exchange, just as bolts derive their value from the need for a means of connecting things together.
The addition of counterfeit money does not lower transaction costs; in fact it RAISES them, because now all traders must expend effort to validate the currency they recieve.
The higher transaction costs are not entirely due to the counterfeiters. Validation is only required to comply with anti-counterfeiting laws, which are an artifact of fiat currency. Much of the blame goes to those who would attempt to substitute fiat currency for that which does not require any such validation.
Anyway, we were talking about the utility of currency itself, however it was produced, not the act of counterfeiting per se. Currency has utility as a medium of exchange; for this purpose it doesn't matter whether it is legal or counterfeit. A perfect counterfeit would work just as well as a bill printed by the Treasury. Ergo, your statement "a paper bill has no utility, whereas a bolt does" is false. Both have utility.
Also, I never said I subscribed to the utilitarian position myself; so far as I am concerned the present utility of a good can only be objectively measured by the demand for it; anything else is nothing more than opinion based on one's own subjective preferences.
There is NO demand for counterfeit currency, and everyone rejects it as soon as they become aware of it.
Again, only because of anti-counterfeiting laws. If use of counterfeit bills was not strictly punished, or there was no test which could reliably distinguish between legal and counterfeit bills, no one would care where the bills originated.
You say that counterfeiters are responding to a demand for more currency, yet in today's inflationary climate (in which currency is slightly oversupplied) we see counterfeiters operating nonetheless, which means there is an error in your line of reasoning.
You have a strange definition of "oversupplied". To me, "oversupplied" means that supply of a good is greater than the demand for it, such that the good no longer commands a price capable of offsetting the cost of producing it. Clearly for counterfeiting to be profitable that cannot be the case: the demand for currency is much greater than the cost of producing it.
Inflation implies that the supply of currency is increasing; it does not imply that the currency is oversupplied. In fact, due to anti-counterfeiting laws fiat currency is continually undersupplied, which is where the profitability of counterfeiting arises. There is always profit to be had in circumventing an (effective) production limit.
If fiat currency could remain practical at a market-determined price—one where supply and demand were equal—then without anti-counterfeiting laws the supply would simply rise until counterfeiting was no longer profitable, at which point it would be just as good as any other commodity currency. Unfortunately for fiat currency, its market price is deliberately designed to be nearly zero, which is impractical in any currency. Other commodities would take its place long before that point.
"The state is that great fiction by which everyone tries to live at the expense of everyone else." - Bastiat
Without it, a physical machine will break. Or a broken physical machine will be irreparable.
That's where you've lost me. I regard money as a meta-good for these reasons:
For these reasons, money deserves special treatment. That doesn't automatically imply that we need a government monopoly; I am just answering your claim that money is just like other goods.
Unfair to transplant my bolt example out of context and then knock it down. A tribe doesn't necessarily need bolts, but it needs goods before it needs a metagood that can lower transaction costs etc. It needs water, wheat, guns, and so forth.
No member of the tribe could want, or be enriched by, currency unless other people were already holding goods of some kind that they would trade for it.
Not true. If anyone could legally produce currency, and the market then settled on certain flavors as generally acceptable, we would have to constantly check whether the buyer's currency was a) one of that month's desirable flavors, and b) not a clever copy of one of the desirable flavors.
Like what? Tying currency to any tangible good is fraught with problems. This is the conversation that was had about the gold standard, but it applies to whatever object is backing the currency...
The biggest problem is the inflation/deflation lurches that occur when the supply of or demand for the backer good changes. Gold had the smallest lurches because its supply is now nearly static (practically all gold dug in all of history is still in circulation).
The second problem is an effect of solving the first problem: if the backer good is stable, then the supply of currency cannot change to follow the total amount of wealth in society. Once again we get inflation/deflation lurches.
I consider those problems to be worse than the cure. Lending or borrowing, which are critical for economic growth, are both perilous when inflation/deflation is not stable.
FATMOUSE + YOU = FATMOUSE
There's a difference? I think all U.S. currency is counterfeit.
-I like my women like I like my tea: green-