North Korea's High-Tech Counterfeit $100 Bills 528
ESRB writes "North Korea is apparently able to produce high-quality counterfeits of U.S. dollars — specifically $100 and $50 bills. It's suspected that they possess similar printing technologies as the U.S. and buy ink from the same Swedish firm. 'Since the superdollars were first detected about a decade ago, the regime has been pocketing an estimated $15 to $25 million a year from them. (Other estimates are much higher — up to several hundred million dollars' worth.)' The article also advocates a move to all-digital payment/transfers by pointing out both forms are only representations of value and noting it would cripple criminal operations such as drug cartels, human traffickers, and so forth."
No world without anonymous currency, thanks. (Score:4, Insightful)
"The article also advocates a move to all-digital payment/transfers by pointing out both forms are only representations of value and noting it would cripple criminal operations such as drug cartels, human traffickers, and so forth."
I would rather live in a world where I can carry cash and buy things without some asshole profiteer figuring out how many companies they can sell me out to behind my back.
Its a SWISS, not a Swedish firm (Score:5, Insightful)
The ink is made by a Swiss, not a Swedish company. What the hell is it with Americans that they confuse these all the time.
Re:Math Pedantry (Score:5, Insightful)
I wouldn't call it pedantry. I'd call it legitimately calling out the author for both having no apparent grasp of basic arithmetic, and likely being a moron.
electronic payments are not privacy compatible (Score:5, Insightful)
Electronic payment records are already being recorded and data-mined by corporations for fun and profit. If every payment is electronic, every payment is traceable and every thing you ever pay for will be recorded, compiled and cross referenced. I really don't trust corporations or even my government that much.
Repeat after me: "Cash Clears at Par" (Score:5, Insightful)
Why does cash still exist in widespread usage? It clears at par.
If someone wants to pay you $10, and they give you cash or a check, you get $10. If they want to pay with anything else, be it Paypal, Square, some other mechanism, etc, the payment processor changes some ridiculous fee that will range from $.10 to $.50 or who knows what higher.
"Clearing at par" is why cash and checks still exist, and until electronic transactions are not only convenient and easy, but ALSO clear at par, there will still be a huge role for cash and checks.
19th Century Bills (Score:4, Insightful)
American currency is stuck in the 19th century. All around the world, countries with currencies that Americans scoff at as "worthless" have invested time and money in redesigning their currency to 21st century levels that make it harder to counterfeit. But, whenever anyone in power even breathes a word of redesigning US currency, the populace flies into a rage, foaming at the mouth about anyone daring to pervert their sacred greenbacks. All efforts to bring the bills up to date have resulted in hideous, half-assed results.
I've actually heard stories first hand from a currency expert, who used to print banknotes in Europe, who was invited by the US to offer ideas on bringing the currency up to date, and the officials there rejecting each and every idea he put forward because they were "too different".
It's kind of sad. Everyone wants to counterfeit your money, and they're good at it, but you're too sentimentally attached to its archaic design that you're completely unwilling to change it.
Re:Illegal Immigration (Score:4, Insightful)
The law of unintended consequences would strike, and there would be an under-the-table economy using the currency of another country, the latter only too willing to expand its economy on foreign soil. All the cash that anyone would be spending would go to that other country only to be converted into dollars. I'm sure there are some people already making bets on that happening, a bets they'd handsomely profit on. Nothing of substance would change: there would still be illegal immigration into the U.S., only that some extra part of it would be diverted from the local economy to the foreign soil. That is in addition to whatever immigrants, legal or not, are already sending back home (not that it's a bad thing, I merely acknowledge status quo).
OOH! SCARY STORY! (Score:5, Insightful)
We better move you all to traceable, trackable, revokable electronic money.
You thought your privacy hit the fan before? Wait til your every pfennig is nothing but a shifting index in the Federal Reserve database.
Re:BitCoin (Score:3, Insightful)
Well since my karma is already terrible I will offer this humble reply; Bitcoin?! Have you lost your fucking mind? What are you smoking?
Re:OOH! SCARY STORY! (Score:5, Insightful)
Absolutely right. They want us to compare the costs too. OK. The loss to NK, what, a few million a year? That's nothing compared to the cost of overhead, that is, the cost per transaction for these electronic records. Hell, look how much Visa sucks out of the economy every year.
Why don't we just reciprocate and counterfeit NK money? (I kid, I kid)
How? (Score:5, Insightful)
Furthermore, how would you not riot over your government doing something like that to you?
Man, you really don't know anything about NK, do you?
Anyone trying would be shot. There's no press. Very little outside observation, almost none allowed in or out.
On top of that many of the people are very literally brainwashed to adore the countries leadership and accept blindly anything they say or do.
Re:How? (Score:4, Insightful)
Re:it's OK! it's just copyright infringement. (Score:4, Insightful)
It's exactly the same. The problem with counterfeiting money is it devalues the currency. The problem with illegally copying commercial media is that it devalues that commercial media.
Re:OOH! SCARY STORY! (Score:4, Insightful)
Why don't we just reciprocate and counterfeit NK money? (I kid, I kid)
You mean print more US dollars? :-)
Hell, look how much Visa sucks out of the economy every year.
Does it? Or does it enable more money to flow through the economy? If it really was sucking retailers dry like that, wouldn't they just choose not to accept the card? After all, AmEx charges way more than Visa/MC, and it shows by how few retailers accept AmEx, relatively speaking. The cost of accepting AmEx is too high - by extention the cost of accepting Visa is not. Retailers feel, and rightly so I would estimate, that the cost of not accepting credit cards is too high.
Compared to other choices, credit cards can be downright cheap. You avoid counterfit currencies for starters. If you're in a touristy location, you don't have to deal with other currencies and risk a hit when you go sell it for the local stuff (here I'm thinking of when I visited Playa del Carmen, Mexico or Disneyland or Niagara Falls, all of which largely accepted foriegn currencies - the USD in most places in PdC and NF, and CAD in many places around Anaheim - I always used my Canadian credit cards, no problem). You also largely avoid employee theft (employees writing down customers' credit card numbers is a separate problem that doesn't hit your bottom line nearly as often, partially because it's not your money being stolen and partially because it's much harder to convert a written card number to something of value vs cash) because the credit purchases go directly into your bank account at the end of every day. You also don't have to wait for customers' checks to clear.
Re:OOH! SCARY STORY! (Score:5, Insightful)
I take it you never vacation? Or always stay in the country?
Every year it has become more and more of a hassle to get a reasonable amount of cash when I go on vacation. We need to bring back the $500 bill instead of getting rid of $100s. I would rather not have to carry a suitcase full of money through the airport. Nor do I want to pay 3% on top of every purchase when I am overseas.
Re:Paper Money w/ Digital signatures (Score:5, Insightful)
Your solution does not address replay attacks. Unless anybody accepting a bill checks that into a central database there is no way to know that the same bill hasn't been printed a million times with the same copy of the original signature that remains valid.
If I send you a signed email, you can make a million copies of it, and they're all still signed.
Re:Paper Money w/ Digital signatures (Score:5, Insightful)
... The government just needs a private key and digitally sign each paper bill it produces (similar to the current serial numbers but with PKI powers) and then when you accept paper money for payment you will need a computer to read and verify the digital signature is valid. ...
Nice thought, but it won't work. You just need a bill, and you can copy the serial number, signature and all.
What might work is the following: Manufacture each bill with a random "fingerprint", and and sign that. This fingerprint would need to be something that is impossible to create in given configuration (it must be random, and there cannot be any alternative non-random way to make it.) It should also be easy to verify. I do not know of anything that meets these criteria, but there may be something.
Re:it's OK! it's just copyright infringement. (Score:5, Insightful)
Money has no intrinsic value in and of itself. It's only ink on paper.
which is a legal tender for all goods and service.
Because the government says its legal tender. Why do you accept the power the government has to say what currency is, but you don't accept the power the government has to say what's copyright. You can't have logical consistency and say that the government have the power of one and not the other.
Re:it's OK! it's just copyright infringement. (Score:4, Insightful)
Only to the same extent that forging a movie DVD steals from everyone else who owns that DVD.
Re:19th Century Bills (Score:4, Insightful)
heaven forbid your money actually be accessible to the blind...
and the polymer currency that many nations are now introducing are far more durable than paper money. (though US paper money is actually cotton... still....)
Re:OOH! SCARY STORY! (Score:4, Insightful)
Every year it has become more and more of a hassle to get a reasonable amount of cash when I go on vacation.
Er... why? Do you do a lot of spelunking? I've had a problem using a foreign ATM maybe once or twice, and it was only that particular ATM, not all of them in the entire country. And why would you bring U.S. cash, when the credit card companies (including your ATM card) generally have access to better exchange rates than anyone who would take your cash?
Re:BitCoin (Score:5, Insightful)
The GP actually has it right. He's not describing the Treasury Department or Stimulus Bill bailouts, he's just describing one of the mechanisms by which money is put into circulation. The problem with your analysis is that you are talking like debt can be conjured out of thin air. It can't be. Debt is the result of a *trans*action, which has two sides; if there is income on one end, there's expense on the other; if there's debt incurred on one side, there's assets acquired on the other. The Fed cannot add to the economy's *total* debt by the mechanism the GP describes because a debt and an equal asset are conjured into existence *together*.
The "growing debt" you are talking about simply reflects this intrinsic double-sidedness of transactions. Suppose the economy doubles in size. If you want stable prices, the amount of dollars in circulation has to double. Because of the double-sidedness of transactions, that means the amount of debt on the Fed's books has to double; logically it amounts to the very same thing. There's no way to get more money into circulation without creating a corresponding debt on the central bank's books, unless you want to *give* it away. If you simply give money away when you need the money supply to contract, you have no choice but to *take money away* from people. The system of loans is sensible in that the disbursement and collection of money are built-in.
So what about that interest paid back to the Fed? Is that a problem? Well it is true that the interest paid back to the Fed *does* take dollars out of the economy, but that's the easiest problem in the world for a central bank to fix. It simply lends them right out again. But the numbers keep getting bigger. Isn't that heading for disaster? No, because the numbers keep getting bigger only if the amount of money in circulation grows, and that should only be done when the economy grows. If dollars are only traded for things of value, then ultimately those dollars have to make their way into the hands of people who've created new value. So what if the economy contracts instead of expands? Even easier. That interest payment takes currency out of the economy, which is just what you want.
This all seems a bit "through the looking-glass, but keep in mind that money has no *intrinsic* value; it's just a token we use to making trading things with *real* value convenient and flexible. I was advising a friend recently to sell a small factory he owns but has no immediate use for. In fact tying up his capital in this asset is slowing down his business growth. "Put the extra 6000 sq ft of facility in a more productive investment; when you've grown the business enough to need it, take that space out again."
It makes no sense to talk about "under" or "over-valuing" goods in terms of *currency*; it only makes sense to value *one* kind of good against *another*. In other words it makes no difference if your magic sword costs ten rupees or a hundred so long as everything else in the game is proportionately scaled. The only reason you want stable prices so that *future* goods are not undervalued (inflation) or overvalued (deflation) relative to things you could buy today.
The only way to ensure stable prices is to manipulate the money supply to parallel economic growth. Is the process of manipulating the money supply subject to abuse and fraud? HELL YES. So is *every other* power we grant the government, from passing laws or maintaining national defense.