Should the $500 banknote be revived

Not meaning to be petty, but you probably meant Roanoke, NC -- the lost colony on the coastal island. Roanoke, VA was quite a bit later and developed as a railroading center in the Shenandoah Valley, over in mountain country.

Quote: Doc

Not meaning to be petty, but you probably meant Roanoke, NC -- the lost colony on the coastal island. Roanoke, VA was quite a bit later and developed as a railroading center in the Shenandoah Valley, over in mountain country.

I was speaking in a historical context. When Sir Francis Drake came to America and founded Roanoke, he named the whole country Virginia, for the Virgin Queen who was still alive. Queen Caroline wouldn't become queen consort for another century and a half, and no one had any idea that the British monarchy would go to a German family.

But you are correct, to be accurate, I should have said Roanoke, in what was then called Virginia.

Roanoke was the 1580's.

Jamestown was founded in 1609, Plymouth in 1620, and Manhattan was bought in 1626 by the Dutch. Boston was started in 1630.
By 1630 there were 2500 people in present day VA, 900 in present day MA, another 900 north of Boston in present NH, and Maine, and 400 Dutch living in Manhattan.

The settlements grew rapidly so that there were at least 200,000 when the Salem Witch trials began 60 some years later.

THe EU moves seem particularly strange in light of the 500 EURO banknote.

'Black Market in Spain':
Things are going so "well" in Spain that the Government banned cash payments in excess of 2,500 euros

The Prime Minister, Mariano Rajoy, has announced on Wednesday that the plan to combat tax evasion on Friday approved the Cabinet prohibit the payment in cash transactions of over EUR 2,500 and n which at least involved a businessman professional.

During the control session the Government in the House of the Congress of Deputies and in response to a question about the tax amnesty made by the general coordinator of IU, Cayo Lara, the Prime Minister has revealed that those who violate the ban will face fines of 25% of the payment made in cash.

Italy May Have to Kick Its Cash Habit as Monti Cracks Down on Tax Evaders
Floriana d’Andrea, a Naples musician, carries rolls of euro notes when she buys instruments and audio gear, a practice she’ll have to change as Italy sets new limits on cash payments in a bid to curb tax evasion.
“I bought some expensive sound equipment and the shop owner jacked up the price when I asked for a receipt,” said d’Andrea, 41, who paid 1,600 euros (USD 2,093) in cash in the transaction. She has a credit card, but rarely uses it, she said..
Prime Minister Mario Monti, in office just over a month, wants landlords, plumbers, electricians and small businesses to stop conducting large transactions in cash, which critics say helps them evade taxes. The government on Dec. 4 reduced the maximum allowed cash payment to 1,000 euros from 2,500 euros.

In Sweden, cash is king no more
March 17, 2012
STOCKHOLM (AP) - Sweden was the first European country to introduce bank notes in 1661. Now it's come farther than most on the path toward getting rid of them.

"I can't see why we should be printing bank notes at all anymore," says Bjoern Ulvaeus, former member of 1970's pop group ABBA, and a vocal proponent for a world without cash.

The UK Payments Council – which represents banks and card companies – announced it was undertaking a major project into how to make paying by mobile “as easy, efficient and secure as any other way to pay”.


Australia is also moving towards a cashless society, with the number of consumers making ATM cash withdrawals dropping to the lowest point in more than six years. Typically, cash is used for transactions of less than USD 25.

Cash is also no longer king in New Zealand, electronic funds transfer (Eftpos) displaced cash as the most common payment method.

In Canada, credit cards continue to dominate online buying by a wide margin, and online debit payments in 2010 doubled in volume.

South Korea introduced a preferential VAT (value-added tax) treatment for consumers paying with cards to encourage the move to cheaper, cashless payments.

In Africa, six million people are already paying for goods electronically. Smartpay’s electronic banking concept, pilot project οf Net1′s Complete Electronic Payment System (UEPS, іѕ all about facilitating cashless transactions market wіth a prepaid smart card οr debit card issued via retail аnԁ community agents. Thе thriving implementation οf Smartpay’s electronic banking concept сουƖԁ bе a major stride towards making countries like Zimbabwe and Ghana becoming a cashless society.

In Botswana, thе system іѕ used tο provide insurance tο villagers аnԁ social grants through supermarkets, while іn Malawi thе system іѕ used fοr thе distribution οf anti-retroviral drugs, inputs аnԁ payments fοr agro inputs аnԁ produce.

In South Africa four million pensioners υѕе thе smartcard аѕ аn tab аnԁ need nοt travel further thаn thеіr local areas. (Source) Rwanda is in a huge partnership with Visa to develop the country’s payments system. In Nigeria, the Intercontinental Bank Plc, IBPLC, has revealed its desire and determination to make the country a cashless country.

Casino chips ideal currency for criminals

Is a discussion of the Royal Canadian Mounted Police (RCMP) investigation into money laundering schemes using BC casinos.


Canada briefly introduced a $1000 banknote about 12 years ago, but has since withdrawn it at the request of the RCMP. The BC casinos have chips in denomination of up the $5000 .

But the investigation also centered on people who supposedly bring in boxloads of $20 bills, and are not subject to any questioning.

The link to the Canadian transfers...
Mohegan Sun was investigated in 2000/01 for gangs of Poker Players passing chips in the restrooms. Passing chips on the Casino Floor is rather dumb, considering the surveillance in most casinos.

Cashless societies...
Desired by bankers and financial institutions so they can charge money to deposit/withdraw your money from your account. It will no longer be "my money"... think about it.

Quote: 98Clubs

Cashless societies...
Desired by bankers and financial institutions so they can charge money to deposit/withdraw your money from your account. It will no longer be "my money"... think about it.

Cashless society will probably be something that we will still be talking about in 30 years.

I think that Iceland is the most likely candidate, only because they are seriously considering adopting the Canadian dollar. To change your currency is difficult enough, but to go to another country's currency means that banknotes and coins become a significant expense since the notes must be acquired at face value. Plus the population is a mere 313,000 .Currency circulation is around US$1000 per person, and the largest banknote is worth US$40.

Aruba is even fewer people (just over 100K people), and circulation is around US$1100 per person. But they print a banknote worth US$280. Although it is in very limited circulation (only 10K banknotes are in circulation), the government still recognizes the need for a large banknote for private transactions. I can't imagine you could use it most stores.

Despite the stories about how High-tech Sweden edges closer to cashless society the Riksbank is not paying any formal attention to the idea of a cashless society.

They have been reducing the amount of cash in circulation. For instance they pulled out 3.5 million of the 28.6 million thousand kroner notes out of circulation last year (worth US$145 apiece). But the concern seems to be more in reducing the number of notes without the security thread which was introduced 6 years ago.


Although the notes are not common (there are now less than three per capita in circulation), the Bank has announced a new issue of notes with all new cultural figures. None of the denominations are missing, and a new 200 kroner denomination has been added with a value more suitable for ATM distribution.

So it would seem to be more of a media war than a government initiative.

Two questions:
(1) I guess Sweden is now giving up all pretense of entering the EuroZone. Do you think any new countries will join now?
(2) What do you think about Sweden's idea of putting all 20th century cultural figures (writers, actresses, directors, painters, diplomats) instead of politicians and dead presidents on money? The current edition of banknotes does not have presidents, but has two famous kings from the 16th and 17th century. Do you think the USA will entertain such an idea in the future?

Quote: pacomartin

(1) I guess Sweden is now giving up all pretense of entering the EuroZone. Do you think any new countries will join now?

Is this a trick question? What country in their right mind would join the EuroZone in its current state? I don't know the history of Sweden and the Eurozone, like if they were supposed to join it after a certain point or were supposed to make progress toward it or something. I know the Czech Republic was planning on joining the Eurozone for ages, but finally just indefinitely postponed it.

Quote:

(2) What do you think about Sweden's idea of putting all 20th century cultural figures (writers, actresses, directors, painters, diplomats) instead of politicians and dead presidents on money? The current edition of banknotes does not have presidents, but has two famous kings from the 16th and 17th century. Do you think the USA will entertain such an idea in the future?

I like the idea, but I don't think it will ever catch on in the US. We already have one face for every denomination, and they are fairly well entrenched in popular culture (it's all about the benjamins, for example).

Like said above, cashless society is really about separating you from your money.

So if you have unpaid parking tickets, a missed credit payment, or suspected bonus abuse... and no longer does the local government or the bank have to show evidence and use legal recourse against you, they can just deactivate your account and now you have to go to court and prove yourself innocent.

Quote: pacomartin

(2) What do you think about Sweden's idea of putting all 20th century cultural figures (writers, actresses, directors, painters, diplomats) instead of politicians and dead presidents on money?

I guess scientists or inventors would work, but anyone with less clear-cut and material contributions, not really. I would not want on my money: writers, actresses, directors, painters, diplomats, courtesans or any other public pandering professions.

You know it's not Lem, Kubrick, Martin they are going to put on the money, it's whoever played to the current party's agenda and overall politically correct sentiment the best, or at best whoever's topped the charts yesterday. Over Brown, Streisand, Asshol, Jobs and Lewinsky ... I think I'd rather stick to Franklin.

Quote: P90

Over Brown, Streisand, Asshol, Jobs and Lewinsky ... I think I'd rather stick to Franklin.

Who is Asshol? Is that really their last name?

Sadly not, that would actually be funny, in a Mike Judge way, but still. Just the artist they would most likely put on money, if they were doing it. Not really picking on him so much as on excessive idolization.

Though, come to think of it, I should take back that bit. If you are to put an artist on your money, there is indeed no one more fitting, in an ironic statement, like how "...others must pay" initially was. But he'd have to be alive to design the actual bill, a photo would kill the whole point and his self-portrait wouldn't fit in with a conventional bill ($1 so you wouldn't need counterfeiting protection).

Sorry for derailing the thread a bit -- did he actually create the Campbell's soup can design, or did he just use the Campbell's soup can design in his art?

Quote: AcesAndEights

Is this a trick question? What country in their right mind would join the EuroZone in its current state? I don't know the history of Sweden and the Eurozone, like if they were supposed to join it after a certain point or were supposed to make progress toward it or something. I know the Czech Republic was planning on joining the Eurozone for ages, but finally just indefinitely postponed it.

All states of the EU except Denmark, and the United Kingdom, have committed themselves by treaty to join EMU. But Denmark has formally committed to the Exchange Rate Mechanism Level II. Sweden is trying to avoid the committment by never entering ERMII , but it still tries to control it's exchange rate to stay within reasonable bounds.

Although timelines are fluid, making the decision to print an entire new set of currency and make new coins in 2015/2016 is kind of a strong decision. Usually a new set of currency lasts ten years at a bare minimum, and often much longer.

Soup can design itself came first.
The point behind that can drawing was that there were over 30, one for each flavor of soup, with no other differences, and they were lined up much like soup cans in a store. That was probably the best trolling of the art community at that time.

Quote: P90

You know it's not Lem, Kubrick, Martin they are going to put on the money, it's whoever played to the current party's agenda and overall politically correct sentiment the best, or at best whoever's topped the charts yesterday. Over Brown, Streisand, Asshol, Jobs and Lewinsky ... I think I'd rather stick to Franklin.

I don't think any county would put anyone living on money, unless they were a monarch.

Current people on Swedish banknotes
Selma Lagerlöf (died 16 March 1940) Author of children's books
Jenny Lind (died 2 November 1887) Opera singer
Carl Linneaus (died 10 January 1778) Botanist, physician, and zoologist
Karl XI of Sweden (died 5 April 1697) King of Sweden during Swedish Empire
Gustav Vasa (died 29 September 1560) King of Sweden during Swedish War of Liberation

Right now they are circulating about 37 banknotes per person
3 : kr 1,000 ( $144.68 )
12 : kr 500 ( $72.34 )
0 : kr 200 ( $28.94 )
10 : kr 100 ( $14.47 )
3 : kr 50 ( $7.23 )
9 : kr 20 ( $2.89 )




New people on Swedish banknotes in 2015-2016
Astrid Lindgren (died 28 January 2002) Author and screenwriter (Pippi Longstocking)
Evert Taube (died 31 January 1976) Author, artist, composer and singer
Greta Garbo (died 15 April 1990) Film actress
Ingmar Bergman (died 30 July 2007) Film director
Birgit Nilsson (died 25 December 2005) Dramatic soprano
Dag Hammarskjöld (died 18 September 1961) Diplomat, economist and author

Half of those people only died in the last decade.

If the USA had to choose people that died since WWII, I wonder who we would choose?

Quote: P90

You know it's not Lem, Kubrick, Martin they are going to put on the money, it's whoever played to the current party's agenda and overall politically correct sentiment the best, or at best whoever's topped the charts yesterday. Over Brown, Streisand, Asshol, Jobs and Lewinsky ... I think I'd rather stick to Franklin.

Lem would be more appropriate on Polish currency since he was born and died there.

By the way, someone just "tweeted" me from the Warsaw airport, and I was surprised who it was named after. 50 quatloos if you can name the person, as well as three other major airports that are named for musicians (all on different continents).

?

Quote: Nareed

Show Spoiler

Chopin

?

Yes. Anyone want to take a shot at the bonus? (Paco?)

That was rather easy, although the man was a composer properly speaking :)

Quote: teddys

Yes. Anyone want to take a shot at the bonus? (Paco?)

Not wihtout the aid of Google or other omniscient source...

deleted

Quote: Ibeatyouraces

I don't know if this has been mentioned but heres an idea. If the $500 bill is too large, how about a $200 bill?

The two extremely unpopular denominations are the $2 and the $50 banknote. Most people regard the $2 as no particular efficiency saving over the $1 bill. It should be noted that is an American sentiment, as most countries have it's equivalent as coin or a banknote.

The $50 is very unpopular in USA and Canada (although it is heavily used in Australia). Most people feel that it only offers an incremental improvement over the $20.

Similarly the 200 euro banknote is the least used denomination. The feeling is the if you need a middling amount of cash you collect a pile of 100 euro notes. If you want enough cash to pay off the roofer, impress your mistress and not leave a bank trail for the hotel rooms, or if you are trying to move a lot of money out of the country you need a 500. If you want a think envelope that won't attract attention and you want to mail it to Kenya, you put a 500 Euro note in it.

Canada bypassed the CAD$500 entirely in the and on May 4, 1992 issued the CAD$1000 banknote. They withdrew it from circulation on May 12, 2000. By withdrawel, they did not demonetize the note, they stopped printing it and they didn't issue a new note with the latest security features. Eventually people turn in almost all the notes, and the bank sends them to the BEP where they were destroyed. The motivation for ending the denomination was that Canadian Mounted Police testified that they were too strong of a lubricant to crime.

One of the problems that government faces is that there are roughly 8 billion Benjamins in circulation, and it will easily reach 10 billion by the time the replacement notes are ready. The production, logistics, security, and distribution of all those new notes (around the world) will be a fortune. The government has to set up exchange centers in many countries. It would make a big difference if they had a billion McKinley's to work into the mix.

The incremental change made by adding a $200 banknote is probably not worth the effort.

deleted

Quote: Ibeatyouraces

I can understand the unpopularity of a $2 or $50 bill. In actuality, I here people asking for $50's all the time. But we're talking about large denominations where you wont necessarily want or need change when spending them. I personally would rather have fifty $200 bills than a hundred $100 bills for $10,000 cash. I don't ever see the Feds doing this but make a bit more sense than the $500 bill.

The €200 banknote in the Euro zone is by far the least popular denomination of the six denominations €500,€200,€100,€50,€20,€10 with three times as many €500 notes circulating and nine times as many €100 notes circulating As a matter of fact, it is circulating at a rate of just over 20% of the rate of the American $2 bill. The Euro Zone and the USA have similar populations.

Now, I will grant you that it would probably be more popular if the €500 banknote didn't exist.

BTW, after many years of the Euro being in front, the US Dollar is now circulating almost exactly the same amount of currency (given the present exchange rate). I think that a large number of Europeans are going to want Benjamins as a hedge against the Euro dropping radically in value.

Quote: teddys

By the way, someone just "tweeted" me from the Warsaw airport, and I was surprised who it was named after. 50 quatloos if you can name the person, as well as three other major airports that are named for musicians (all on different continents).

Okay, since nobody showed any interest, I can think of three:

John Lennon International Airport, Liverpool, England.
Louis Armstrong International Airport, New Orleans, Louisiana.
Antonio Carlos Jobim International Airport, Rio de Janiero, Brazil.

Of the three, Rio's is by far the biggest. Says something about how big Jobim was to name the second-biggest airport in the country after him.

Does Salzburg have an airport?

Quote: Nareed

Does Salzburg have an airport?

Yes, Mozart Airport.

Quote: teddys

Yes, Mozart Airport.

Salzburg's Mozart airport is a tiny regional airport for the ski trade and the summer Mozart festival. The end of the runway is only 1 mile from the German border, The huge Munich airport is only 70 miles away.

Salzburg is a beautiful city.

Quote: T. Allison, Assistant to the Board of the Federal Reserve System in his October 8, 1998 testimony

before the U.S. House of Representatives, Subcommittee on Domestic and International Monetary Policy, Committee on Banking and Financial Services.
There are public policies against reissuing the $500 note, mainly because many of those efficiency gains, such as lower shipment and storage costs, would accrue not only to legitimate users of bank notes, but also to money launderers, tax evaders and a variety of other law breakers who use currency in their criminal activity. While it is not at all clear that the volume of illegal drugs sold or the amount of tax evasion would necessarily increase just as a consequence of the availability of a larger dollar denomination bill, it no doubt is the case that if wrongdoers were provided with an easier mechanism to launder their funds and hide their profits, enforcement authorities could have a harder time detecting certain illicit transactions occurring in cash.

To the best of my knowledge the formal decision has not changed. But I have learned that the Bureau of Engraving and Printing is no closer to fixing their problem with the series 2009 color Benjamin since the printing of these banknotes was started over two years ago.

The BEP is still printing the series 2006A banknotes, with the rapidly aging collection of security features. As I have said before, many people around the world do not accept the 2003 series of $100 banknotes because of concerns about North Korean supernotes. The concerns may not be valid, but the failure to accept currency is the problem.

Although you could argue that the printing of a $500 banknote could have just as many problem, presumably it is not as serious of a problem to make them five times as expensive to produce. Also you need to make a lot fewer of them to circulate. In 1996 when the big headed Benjamins were introduced, the pledge was made that a new banknote would be issued in ten years to stay ahead of counterfeiting. It's obviously been 16 years, and there does not seem to be any chance of getting the new banknotes in the next two years.

A White House Petition was started by me. I need 150 signatories to make it public, and another 25,000 signatories and the White House will provide a formal response. If you agree that we need something (banknote, coin, casino chip) that is worth more than $100 sign the petition.

I know that the problem with coins is that they must be written off at face value. Banknotes are essentially "liabilities", but they may not have the technology to put an RFID chip on them that survives the crumpling.

I felt I had to put some restrictions on their use so that the White House wouldn't simply say that it is a bad idea since large currency is an aid to criminal activity.

Just 24,998 to go. ;+)

Quote: miplet

Just 24,998 to go. ;+)

I am gambling that the interest in this web site has been kicked up by the news articles about the Catholic Church == Hate Group. But I need the first 150 signatures or they won't even make it public.

"It helps criminals" isn't the reason. The reason is simply that there's no point to it. Even though it's worth a lot less than $100 was worth before the Nixon shock, people in those days used cash for large transactions, and people today just don't. The only place I see hundreds is in the casino - everywhere else, people either pay with twenties or by debit.

Quote: 24Bingo

The reason is simply that there's no point to it. Even though it's worth a lot less than $100 was worth before the Nixon shock, people in those days used cash for large transactions, and people today just don't. The only place I see hundreds is in the casino - everywhere else, people either pay with twenties or by debit.

Your observations aren't valid. The federal reserve is circulating more than 8 billion Benjamins (i.e. $800 billion). About 3/4 are circulating overseas. The commercial casino business has a gross gaming revenue of about $35 billion per year, and the overwhelming majority of that business is slot machines which seldom make use of $100 banknotes.

The banknotes larger than $100 were all printed prior to WWII. On July 14, 1969 it was formerly decided to remove these large banknotes from circulation when they were turned into the federal reserve. At this time there was less than 1/4 billion Benjamins in circulation, and a relatively small percentage (roughly 5%) were circulating overseas.

There is a massive use of Benjamins that is going on outside of the world of transactions in stores and restaurants that you see. Many people touch a Benjamin between zero and three times a year.

The color $100 banknote has a new release date on 8 October 2013 . They clearly believe that they will have enough of them produced that they will be able to replace the old ones without causing a panic.

I am skeptical.

Quote: pacomartin

They also took out the LIVE, as they are generally wary of live TV in America without professional actors. They are terrified of someone saying 'crikey' or 'bollux' or of the action moving too slowly.h.

It's funny because LIVE TV has made a bit of a revival in the last decade, with reality shows wanting to present results live so as to prevent leaking of winners and losers. American Idol, Dancing With the Stars, Survivor, etc, have all used Live TV successfully.

And to take this discussion full circle, when I was younger, the only place I used to see $500 and $1000 bills were on game shows! Monty Hall used to hold up $500 or $1000 bills to entice contestants. I also remember them on the show Sale of the Century. Sometimes they didn't look exactly "real", but they weren't like phony-designed. They were made to look exactly like the actual bills. Sometimes they may have been the actual bills.

Quote: cclub79

And to take this discussion full circle, when I was younger, the only place I used to see $500 and $1000 bills were on game shows! Monty Hall used to hold up $500 or $1000 bills to entice contestants. I also remember them on the show Sale of the Century. Sometimes they didn't look exactly "real", but they weren't like phony-designed. They were made to look exactly like the actual bills. Sometimes they may have been the actual bills.

Let's Make a Deal (LMAD) was on from r 1963 until 1975.

All the denominations above $100 were part of the 1928, 1934, and 1934A series which may have been printed up until 1945. The next series was 1950. The high value were not "discontinued" on July 14, 1969. At this point all the notes in possession of the banks were destroyed, and every note subsequently turned in were destroyed. The remaining notes are still currency, but are more valuable as collector's items than at face value.

So if LMAD had real ones, there probably wasn't very many of them. If they were fake they would have to be obviously fake (like the wrong face), as the Secret Service looks poorly on realistic copies.

There were only a total of 46,240 of the $10,000 notes printed. Since not that many people can afford to keep a $10K collectible for 80 years, most of them were turned into the banks and destroyed. The remaining ones are very rare.

Quote: pacomartin

If they were fake they would have to be obviously fake (like the wrong face), as the Secret Service looks poorly on realistic copies.

I know, I always used to think that too, but they looked pretty realistic, though always slightly fake. I guess like play money you can buy. Pause this at around 2:42 and you can see what I mean. I don't think they are real.

https://www.youtube.com/watch?v=4TOhIDm_NY0

I think the $500 bill should be printed again with Ronald Reagan's portrait.

There will be sufficient supplies of the new $100 bill when they are released in October. The tasks till then is to get the word out what the new "legitimate" bills look like, because:

A. They don't want to open the door to "look alikes" to be passed as legitimate
B. They need to educate consumers to know that the "old bills" are still valid currency
C. They want bank tellers, business cashiers, to know what the new ones really look like
D. They want the vending machine industry to be ready (aka casinos)

Quote: AlanMendelson

They need to educate consumers to know that the "old bills" are still valid currency

The BEP prints brochures with the following statement:
It is not necessary to trade in your old-design notes for new ones. All U.S. currency remains legal tender, regardless of when it was issued.

Technically you can spend one of the $500 banknotes that were printed in 1934 at the store. The store is allowed to deposit it in the bank and the bank is permitted to turn it into the treasury. But once the treasury gets it, they are obligated to destroy the note. Everything else is legal. But, of course it won't happen.

The big headed twenties were printed beginning in June 1998 during Clinton administration. They stopped printing them in June 2003.
The color $20 banknote begin printing in May 2003 but they didn't have enough to completely replace the old notes until 2009 or 2010. But since nearly all the banknotes circulate in the USA, people didn't reject the older non-color banknotes.

The problem with the c-note is people get nervous about the older ones much faster than they do about a $20 banknote. Furthermore most c-notes circulate overseas where people get nervous much faster than in the USA. Government assurances written on brochures don't mean much, and you are often trying to "educate" people who don't speak English. Plus you are often dealing with cash that people don't want to acknowledge what they did to procure it.

Since there is no $500 note, there are more $100 notes circulating than $20 notes. On June 30, 2012 there was 17% more c-notes than $20-notes or an extra 1.2 billion notes.

Quote: pacomartin

Since there is no $500 note, there are more $100 notes circulating than $20 notes. On June 30, 2012 there was 17% more c-notes than $20-notes or an extra 1.2 billion notes.

Wow, that surprises me. Other than us gamblers, I didn't think anyone used $100 bills.

Quote: DRich

Wow, that surprises me. Other than us gamblers, I didn't think anyone used $100 bills.

It surprises a lot of people. It surprised me when I first notice it in the late 1990's when twenties were still twice as plentiful as c-notes. At the time it was often said that our most profitable export was wide body aircraft. The production of narrow body jets is done in a few places and profit margin is relatively low. But only two companies in the world can make a wide-body jet (Boeing and Airbus) and the profit margin is much higher.

I checked the stats and concluded that the export of C-notes is actually more profitable to the country than the sale of jet aircraft.

Which raises the inevitable question of what are we exporting with C-notes? And how reliable is this market, and how does it compare to other countries? Can it keep growing at a rate much higher than inflation? Can the market bust, or can a competitor develop? What effect would counterfeiting have?

The Bureau of Engraving and Printing (BE produced 12 billion big headed $20 notes without color, than another 16 billion in color in 14.5 years. Because the $20 notes wear out because of constant use, there are 7 billion in circulation (roughly 22 per capita).

Production numbers are 16 billion big headed $100 notes without color by the BEP, and report was 8.2 billion were in circulation as of June 30, 2012. That number increases by about 0.1 billion per month. They will probably keep printing them at that rate until October when the color ones are released.

It is difficult to say how many they can make. They produce 4 billion $1 notes in a year largely because the note has no new anti-counterfeiting devices and has been unchanged for decades. They could make the $20 notes in large quantities. But the massive production breakdown after printing over a billion C-notes has never happened before in history. So who knows how many they can make in a pinch.

If North Korea has a super-dollar, now would be a good time to release several hundred million of them. They could push the system into chaos if the BEP can't make replacement notes fast enough. Remember, the real danger of counterfeiting is not the bad notes, it is the fear of getting bad notes.

Estimates vary, but I have seen estimates that as many as 80% of the c-notes are circulating overseas.

Outside of the EURO, most countries contract to private suppliers (even UK and Canada) that they have been working with for most of their history instead of making their own facilities. These companies make all kinds of secure items. But it tells you why most countries are quicker to make simple decisions like how to get rid of the $1 and $2 banknote in favor of the coin. The mint is invariably a government function in most major countries, but Canada's mint makes coins for dozens of smaller countries.

Quote: AlanMendelson

I was joking with you. The new $100 bills won't be released until October 8th. But one of the problems facing the US Treasury now is that they are afraid of counterfeits that will resemble the new bills will start circulating and people won't know the difference.
I've been writing on the new money on my website, here: http://www.alanbestbuys.com/id239.html

Alan, I have to make a point regarding some of your comments

(1) ALAN COMMENT:For months the government went through its stock of printed bills to determine which were printed properly and could be released to the public.

While it is true that the government printed 1.440 billion c-notes of the 2009 series, and announced their intention to design a machine to pull the defective notes before the release, there has been no follow up to this statement. I personally think that they have quietly disposed of these notes and will only issue the 2009A series. This is an important issue, because it determines how many notes will be available in October.

As of the end of 2011, there were only 64 million of the 2009A series notes printed.

For the calendar year 2012, 1.4464 billion c-notes of the 2009A series were printed. As there were 1.440 billion of the 2009 series, it is important to know if any of the 2009 series were salvageable.

It remains to be seen how many of can be produced by October 2013, but it will only be a percentage of the more than 8 billion c-notes currently in circulation. As of the end of 2012 all c-notes were made in the Texas facility (none in the Washington facility). They may be trying to print this entire series in Texas because the design problem means that they can only use specialized equipment. My guesstimate is no more than 2-3 billion will be produced, and it will take years until more than 90% of the present supply can be replaced.

(2) ALAN COMMENT:There is no need to exchange or trade-in older $100 bills for the new ones.

It is true that the US government has a policy, unique in the world, to never demonetize it's banknotes or coins. You can still consider any money ever printed (including the $10,000 bills which were printed in the 1930's) at face value. Now most currency that old is worth more as collectibles.

However, the market does not respect old designs. When the big-headed c-notes were released in 1996, the older notes were quickly considered unacceptable overseas where the overwhelming majority of the c-notes circulate. The US government has to set up special operations in places where US currency is heavily used (like Russia) to ease the problems of exchanging notes.

In general, counterfeiters are trying to take advantage of the confusion as well, by using the relative unfamiliarity with the new notes to pass fakes. When Ecuador dropped the sucre and adopted the US dollar, there were many people who had never even seen a US banknote. Inflation had destroyed the value of the Sucre so that their largest banknote was officially worth US$2. People were easy prey to plain old fashioned color copy counterfeits that could never pass anywhere else.

So while officially there is no need to trade-in older bills, there is a strong unofficial need to do so.

(2) ALAN COMMENT:Casinos are perhaps the biggest users of $100 bills in this country, and many casinos will not give out $50 bills because many gamblers consider $50 bills to be unlucky.

The $50 bill is pointless. The BEP printed 3.25 billion of them (40% in color) between 1996 and before the 2009 series under Obama. It is a nearly useless denomination, and should never have been redesigned. It should have simply been discontinued when the big headed banknotes were developed.

Now the BEP printed 500 million $2 banknotes since 1995. You can at least argue that these are profitable to the government since people buy them and then store them in drawers thinking that they will someday be valuable as collector's items. As if something will become valuable if there are hundreds of millions of them.

Quote: pacomartin

I checked the stats and concluded that the export of C-notes is actually more profitable to the country than the sale of jet aircraft.

I still have trouble viewing this as "profit" so long as every customer has the permanent right to return the "purchase" for a full refund. The outstanding obligation just wreaks havoc with the idea of it constituting profit.

Quote: Doc

I still have trouble viewing this as "profit" so long as every customer has the permanent right to return the "purchase" for a full refund. The outstanding obligation just wreaks havoc with the idea of it constituting profit.

I am being a little tongue in cheek when I call it "profit". You are correct, in that on a balance sheet it would be an outstanding liability, but the US government treats it as profit, and the BEP in their annual report to congress discusses the money as if it was a profit.

In any case, it would be a considerable disaster to the government foreigners lost their confidence in hard US currency. The worst possible scenario is if counterfeiting should shake confidence so much, that people trade in hundreds of billions of dollars in notes for another currency (Canadian, Euro, Swiss, etc).

The Bureau has started posting production figures again. They seem to be hedging their bets by printing a decent number of the old banknotes with Bush's signature. Presumably that is to meet present day demand.

After 19 months, they have $287 billion in the new color c-notes printed. They are printing $17-$20 billion every month. Hopefully they will have enough to keep things under control on the 8 October issue date. The total c-notes in circulation are over $800 billion.

Still unresolved is the $144 billion in color c-notes with before the "unexpected production delay" (unacceptably high failure rate). The government may have salvaged some of these notes or they might have destroyed the whole lot.

The non-color notes will be like the HAWAII overprint notes in WWII. The government says that they are currency, and even if the Japanese had taken the islands, the government might never have declared them "not money", but people don't want them just because a requirement of money is that it makes you feel secure. You lose that feeling of security, and the notes become problematic.

Recently I tried to pay for the buffet in Fremont with 2 $5 notes. One was an old note, and the cashier couldn't tell whether it was genuine or not, neither could her supervisor. They wound up calling security to make a determination. It seems the alck of color or a watermark completely threw them off their game. I'm pretty sure I got that bill at the Ditz, as some of their old slots seem to have trouble reading new notes.

Anyway, I could tell it was genuine. for one thing the material felt right. For another you could see the polyester strip woven in the paper on one side (I think it fluoresces in UV light). I paid with a different bill and was seated. The cashier later came to my table to say the note was good and to return it. Imagine that :)

Quote: Nareed

Recently I tried to pay for the buffet in Fremont with 2 $5 notes. One was an old note, and the cashier couldn't tell whether it was genuine or not, neither could her supervisor. They wound up calling security to make a determination. It seems the alck of color or a watermark completely threw them off their game. I'm pretty sure I got that bill at the Ditz, as some of their old slots seem to have trouble reading new notes.

Anyway, I could tell it was genuine. for one thing the material felt right. For another you could see the polyester strip woven in the paper on one side (I think it fluoresces in UV light). I paid with a different bill and was seated. The cashier later came to my table to say the note was good and to return it. Imagine that :)

The 2003A $5 note was the last non-color $5 banknote. Since the 2006 series they have all been color. Normally people don't counterfeit $5 banknotes, as it would be way to much trouble to duplicate the security strip for such a small note.

Because there are relatively few $5 banknotes in circulation, it isn't difficult to replace most of the old ones with new kind. You don't see many non-color ones left. But because they are not worth much, and there are very few internationally, you don't have a panic to replace them.

The $1 banknote does not have security strip. It makes it harder to bleach them and overprint a larger denomination.

I hear some complaints about the quality of the new $100 note. Supposedly this damage resulted from just being in a wallet.

Also an argument towards having a new $500 or $1000 token. I still favor something modeled after a casino chip which can be checked electronically against counterfeits.

If anyone has any $500 bills, I will buy them from you for a premium. I'm defiantly interested. I knew a bank teller that would call me when they came in, I had 5 very nice ones at one time, they were misplaced or stolen from my house, possibly during a big party I had or maybe some girl I dated. I'm always hopping I will find them in a book or something.

I've been in favor of the following:

1.) Abolish the penny,nickle and 1/2 Dollar ... decimalize the dollar, and reduce expensive coinage.
10c the size of a penny, quarter in between the size of nickle and old quarter, and brass $1. Just 3 coins.

2.) Abolish the $1 bill, and substitute a $1 brass coin. Coins last a LONG time.

3.) Abolish the $10 and $100 bill, using a $50 (already in circ.) and $200.
Denominations are therefore $5, $20, $50, and $200. Option for $500 or $1000.

Quote: pacomartin

I hear some complaints about the quality of the new $100 note. Supposedly this damage resulted from just being in a wallet.

Also an argument towards having a new $500 or $1000 token. I still favor something modeled after a casino chip which can be checked electronically against counterfeits.

Paco,

Not sure what your BBR's are about; they're not clickable, and a cut and paste into a new window just brings up a non-linked logo as well. Is it audio, video, illustrations of torn banknotes?