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."
BitCoin (Score:5, Funny)
It's the only way to prevent counterfeit money.
Re:BitCoin (Score:5, Funny)
4 more years and the dollar is going to resemble Zimbabwean currency anyway... why invest time and effort into this.
We'll be counterfeiting the DPRK's won, and then burning it to keep warm like they do.
Re:BitCoin (Score:4, Funny)
Re:BitCoin Vs USA PetroDollars (Score:3)
It really doesn't matter how many counterfeit $50s & $100s that the DPRK can print or dump onto the international marketplace. Not one bit, even if the DPRK counterfeited $1 Billion USD instead of only $200 Million USD. Compare that to the $2+ Trillion USD that the USA Federal Reserve has created out of thin air, and without even bothering to print them up. This was the amount of "digital dollars" that have been passed along to international corporations, foreign banks, and foreign central banks sinc
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North Korea wanted to make real money, they should simply set up a small 'economic zone'. A tax haven location, where extradition never applies and gold can buy you anything, absolutely anything, nothing to sick or depraved. They'll have the rich and greedy flocking in and readily generate billions every year ( the same rich and greedy will also seek to protect it).
North Korea ain't communist or socialist, it's an insane asylum with the insane in charge.
Re:BitCoin (Score:5, Informative)
That's a misrepresentation of the process. You are describing the bailout loans. The debt created by the fed is in the day to day banking operation.
The fed prints money by depositing electronically into banks. The banks PAY the fed interest on the money. The banks don't deposit the money, this money is what banks use to loan you money. For instance in the form of a mortgage.
So bank shows fed a fraction of loan, fed loans bank dollar. Bank owes fed $1.01 (simplifying here). Bank loans $1 dollar to you and you owe bank say $1.05. The problem is that we've created $1 of money and $1.05 of debt. The 5 cents doesn't exist and therefore is impossible to pay back. So where do you get it? Well at some point it comes from the only place it can. Someone else borrowing another dollar from a bank who borrows from the Fed... So now we have $2 created and $2.10 worth of debt. If we pay the original $1.05 debt, there is only $0.95 money left to pay the new $1.05 debt.
Now scale this up to trillions of dollars. Basically the system works by continually creating an ever growing national debt (and no, I'm not talking about the governments debt). Now we justify this saying that those loans have to backed by goods, even if only a fraction of the loan so we must produce more and more goods to keep the cycle flowing. But the reality is that we can just assign the same goods a continually higher value and continue to create debt without limit. Not only can we, we will do so because we need higher prices to pay off our debts! Inflation creation at its best... and yet our interest rates our higher than our inflation rate... what that means is that our inflation rate is false. What does reporting a lower than reality inflation rate do? Well if you are the currency that the global currency exchange uses to benchmark other currencies against, it means you are stealing from the value of all the other currencies because they are valuing against your false inflation thereby giving you more goods for your currency than the currency is worth when you buy goods in their nation or pay debts.
The result of doing this for 80 years or so? Massive over consumption and over valuation of goods causing rippling global economic crisis... like the one we see now.
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No, I am not describing the bailout loans. Second you have some things really confused.
The federal funds rate is 0.12%. This is the rate banks pay the Fed to barrow money. Here's a link to the list of rates from the Fed:
http://www.federalreserve.gov/releases/h15/current/ [federalreserve.gov]
The Fed pays 0.25% interest on required balances and excess reserves. Here's a link to the rates from the Fed:
http://www.federalreserve.gov/monetarypolicy/reqresbalances.htm [federalreserve.gov]
0.12% - 0.25% = 0.13%
That is the subsidy. And that is why the money
Re:BitCoin (Score:5, Informative)
Economics is not a zero-sum game. Just because an addition 5 cents of debt has been created does not mean it's impossible to pay back. Presumably, people borrowing money at $1.05 on the dollar are planning to do something with it which will result in more than $1.05 of productivity. If you can't make at least $1.05 from the loan, then it makes no sense to take out the loan. Say you buy equipment with the loan which allows you to become more productive at work, You in effect make $1.10 off the $1 loan. You pay $0.05 extra back to the bank, and pocket $0.05 for yourself.
"But nothing new has been created!" That's right. But you're forgetting that there's also value in organization and distribution. A chicken farmer laments that his family has all the eggs they can eat, but only dirty well water to drink. His neighbor the dairy farmer laments that his family has all the milk they can drink, but only his vegetables to eat. They look at each other, and agree to trade a bucket of milk for a dozen eggs every day. The amount of eggs and milk being produced before and after the trade is exactly the same as before. No new materials have been created. But the due to the improved distribution, the value of those milk and eggs has increased. The standard of living and consequently the productivity of both farmers has gone up, even though they're producing exactly as much as before. Better distribution like in the above example will increase productivity without increasing the amount of goods in the world. Efficiency improvements will increase actual production for a given cost. Better organization can also yield increased net production without actually increasing production (e.g. decreasing crop losses due to vermin).
Money is just a token symbol. The actual currency being traded is productivity, we just happen to measure it in dollars because it's easier than bartering for everything. As the population and per capita productivity increases, the money supply must increase to keep pace or else you experience currency deflation. The value of a $1 bill would go up over time, meaning people could "make" money by stuffing it under their mattress instead of doing productive work, resulting in the economy stagnating. So to keep the economy thriving, the money supply should grow slightly faster than the economy (enough money needs to "printed" to match country's increased productivity, plus a little extra). And the way the government does this is by authorizing banks to loan out more money than they actually have. Creating money "out of thin air" to match the increased productivity of the nation's economy due to improved efficiency, organization, and distribution.
Where we get in trouble when people stop appreciating just how much a dollar is worth, and spending it on frivolities whose return in improved productivity does not offset the purchase price (or loan repayment). This typically happens in a bubble, when people become irrationally exuberant that they market will keep going up, and that they'll continue to make "easy money" indefinitely so it's ok to waste it. In terms of how you put it:
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.
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So the the Fed "prints" money by electronically transferring it to the banks. The banks then deposits that money with the Fed and earn 1/4% (or so) interest.
You've got that all backward. First of all the "Fed Discount Window" is now a minor fraction of bank-to-bank overnight loans, so the real rate you need to be looking at is the 0% federal funds rate. Secondly, the 1/4% window transactions you alluded to are loans from the Fed to member banks. As such, the member banks pay the Fed the discounted (below
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The federal funds rate is 0.12%. This is the rate banks pay the Fed to barrow money. Here's a link to the list of rates from the Fed:
http://www.federalreserve.gov/releases/h15/current/ [federalreserve.gov]
The Fed pays 0.25% interest on required balances and excess reserves. Here's a link to the rates from the Fed:
http://www.federalreserve.gov/monetarypolicy/reqresbalances.htm [federalreserve.gov]
0.12% - 0.25% = 0.13%
That is the subsidy. And that is why the money does not make it into the system. It's literally free money for doing nothing.
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Well since my karma is already terrible I will offer this humble reply; Bitcoin?! Have you lost your fucking mind? What are you smoking?
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Bitcoins. We've found a way to smoke them. This time they are REALLY going to make us rich!
Re:BitCoin (Score:5, Funny)
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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
As well as bringing BIG bucks to the banks! Jesus, I imagine they're salivating over the extra fees they'd get. As it is, I have no credit nor debit cards, nor do I want any. When I'm at a bar I use quarters as counters, one per beer, which is both the bartender's tip and a way for
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You tip for the service (not the real task). If you are lousy tipper, the next time you come in, you will the last to be served. Irrespective of if is a beer or water or a cocktail.
:)
I, infact, do tip for coffee (I carry those 1 dollar coins, specially for tips), and any place where I believe their service is worth it.
Though, I do wish they would allow me to write a negative tip for places where the service was horrible
Because wire transfers are never falsified.... (Score:2)
advocates a move to all-digital payment/transfers by pointing out both forms are only representations of value
Sure, we should plug the paper hole, but who here believes that wire transfers are never faked?
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It's exceedingly difficult to fake a wire transfer as they are double checked by multiple redundant systems. You'd have to hack into a dozen different systems and coordinate everything simultaneously.
The best you probably get away with is to fake a transfer for a short period of time. Kinda like writing a bad check, but it's caught much, much faster.
Re:Because wire transfers are never falsified.... (Score:4, Informative)
It's not a matter of botnets - the backbones of these systems use leased lines, they aren't on the internet. They only talk to the outside world through transactions, the only way to access the application or OS is physically walking up to the machine. That's why you need access to dozens of machines, you need to fake them all out simultaneously. Then, it's only a matter of time before the transactions are resolved and your fake is caught.
I once worked with software that queried a credit reporting agency. Their security was completely nuts, and all I was doing was querying credit scores. Think leased lines, short-timeout encrypted access tokens, multiple layers of transport encryption, custom transport layers with multiple transaction verification schemes. They also did some heavy-duty traffic analysis - if you did anything even slightly weird you'd get a mail asking what was going on. This is just for credit scores, now just imagine what banks have protecting money transfers.
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No doubt there is security there, but think rogue APs, USB flash drives in the parking lot, subverted employees, etc.
I wouldn't expect it to be an everyday occurrence, but given the value of the target, I also wouldn't expect it to never happen if the easier routes are closed off..
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The notion that "do it electronically" would solve counterfeiting is the sort of thing I wouldn't expect to see parroted on Slashdot.
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.
Math Pedantry (Score:5, Informative)
The 2009 attempt to raise funds by devaluing its already pathetic currency revealed not only the country's fiscal desperation, but also the abuse Dear Leader was willing to inflict on his people. The won was devalued by 100 percent, which meant 1,000 won suddenly had the purchasing power of 10 won.
It appears they got the 100 to 1 ratio [businessinsider.com] correct but I don't see how this is a "devaluation by 100 percent." Such ambiguous language would normally lead me to believe that a devaluation by 100 percent means everything is completely worthless (with zero percent value left). Wouldn't the correct devaluation percentage be 99 percent? I guess I would have preferred the fraction or ratio comparison instead if that is indeed how listing devaluation by percentage works in economics. Perhaps they could use better phrasing like "reduced purchasing power of all your money to one hundredth of its original worth overnight." Furthermore, how would you not riot over your government doing something like that to you?
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.
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Re:Math Pedantry (Score:5, Funny)
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.
I have it on good account that the article's author had been measured a Barbie Math Quotient of 73, as opposed to 100 for an average Barbie doll.
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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.
Don't act so surprised; he probably an economist.
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> Furthermore, how would you not riot over your government doing something like that to you?
Because the citizens are told (and some believe) that other countries are doing worse to their citizens.
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)
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.
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Yeah! Just like all those absolute morons who think they speak Austrian [ihatethemedia.com] in Austria.
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That's not as bad as people who think you can speak Mexican...
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"American" is the standard English-language word for people from the USA. There's no danger of confusion there, as the USA is the only nation in the world with "America" in its name. Using "America" to refer to the USA is more specific than using "United States," even: Mexico's official name translates to English as "The United States of Mexico." This sort of assault on the English language is simply political correctness run amok.
Besides, even if you were able to artificially redefine "American" to refer t
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Hate to be anal, but this is Slashdot, Mexico's official name in English is "The United Mexican States". And while no country today uses the term "America" in their official name (although there are International organsiations using it), the Federal Republic of Central America [wikipedia.org] did used to have "America" in its name. It was often called the 'United States of Central America' too.
Real reason to go all digital for money (Score:3)
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.
it's OK! it's just copyright infringement. (Score:5, Funny)
Just like copying movies and music: NK haven't stolen anything. The US still has all the dollars it ever has. It isn't like stealing a car where that deprives the original owner of the car. It's more like *duplicating* the car while the original owner still has it.
So it's OK, according to Slashdot.
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It's stealing from everyone who holds dollars, and I suspect you know that.
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.
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No, the only person hurt when you duplicate a DVD is the person legally allowed to sell the DVD
No, the legal buyer is hurt too. Not as badly, but he is hurt. Let's take it to the extreme. Say that there were only 2 official copies of the DVD. I buy one of them for $20. Consider two scenarios.
1) There is no piracy. I feel pretty good about owning the DVD. I feel I got my $20 worth. My friends come round because they want to watch my DVD. I (try to) impress girls with my DVD collection. (Hey we were all young once and tried it.) I can feel superior to my work colleagues because I know what happens in t
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Exactly, that's why I can walk into any convenience store and purchase a beer for the paltry price of five Sir Mix-a-Lot .mp3 singles, or five green Baby-Got-Backs.
Nice troll, but obvious 4/10
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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.
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I don't see how it devalues the media. If everyone on Earth has free use of a particular song, that song is likely worth more given that it's so well known.
If everyone has free use of it they don't need to buy it. You don't get any more extreme devaluing than that.
It would be useful in movies as a background song in the same way that Turn Turn Turn is used because everyone knows it and knows what they're supposed to feel when it is played. It can be played by bar bands. It can be used in mix tapes. The original singers could perform the song and sell more concert tickets.
These are all possible alternative revenue streams. But the first 3 also require that people respect copyright. Are you perhaps saying it's OK for you to break copyright law by copying the song. But filmmakers, bar bands, and mix tape makers have to obey that same law?
You'r very argument admits that the value of the song comes from the ability of the copyright holder to restrict rights for other peop
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Absolutely right. There's nothing wrong with printing copies of money. The government has no copyright on the design.
Now, as soon as you SELL THEM, or otherwise FRAUDULENTLY try to pass them off as legitimate, you have broken other laws unrelated to the copying of the bills.
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.
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.
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"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.
Some banks are actively working on fixing that flaw of checks ;-)
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Some banks are actively working on fixing that flaw of checks ;-)
Others are doing the opposite: a lot of ATMs now have check-scanning on them, and there is also the "Photo the check" apps that several banks are deploying, which are all about "people use checks because they clear at par, so lets reduce our costs so we only lose a penny or so in the process"
Re-read The Handmaid's Tale (Score:3)
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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: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....)
Paper Money w/ Digital signatures (Score:2, Interesting)
We don't have to abandon paper money just because it is not possible to keep forgeries from being manufactured. 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. This would solve the problem (with the added expense of verifying bills) but the government won't propose such a simple soluti
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This is completely wrong.
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.
Wait... (Score:4, Interesting)
We get the ink for our money from another country?
NPR podcast on the topic (Score:5, Informative)
There's an excellent Planet Money podcast on North Korea's illegal economy [npr.org].
In the podcast they explain how North Korea is able to sell their fake currency, as well as the other shady things their government does to make money. It's worth a listen if you're interested in the North Korean regime.
Technology? (Score:3)
What kind of technology goes into printing bills? Just curious, for the sake of philosophy.
Criminal et al use props up the dollar (Score:2)
I've long argued that the main thing propping up the artificially way too high US Dollar is its preferencing by extralegal entities since the normalisation of white collar "work" drove most of the American economy out of inherently tradeable production into devices which must be propped up by legal fictions to acquire monetary value.
Makes sense (Score:4, Funny)
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Kate, in 5 years the Corleone family will be completely legitimate.
Why the US Dollar, why not Chinese Currency? (Score:2)
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The Chinese are more aggressive when they catch your money mules.
One might think that with the amount of US currency that China owns, they would care if someone (other than themselves) was manipulating the dollar's value.
$cnote=physical token digital currency certificate (Score:2)
Current $100 bill are not entirely private. Its trivial to read and record the current serial numbers. And some banks may be doing that for large bills to look for crime payouts.
Much of bitcoins p
Inflation, Bitcoin, Shire Silver (Score:3)
Of course, this is exactly what the U.S. Government itself does: Print new money that doesn't actually represent any extant wealth and then "pocket" the full face value of the new currency. But then once these new bills makes their way into the market, the rest of us get to suffer inflation as a result.
It would do no such thing. More and more people are switching to simple barter mechanisms, precious metals as an intermediate, things like Bitcoin, and "alternative" currencies (example [shiresilver.com]). If the government ever eliminates cash, this will only make such things thrive.
But the fact that North Korea is making a few million a year off of counterfeiting serves as a wonderful pretext for forcing everyone into privacy-less currency, doesn't it?
25m a year (Score:3)
Wow, if they keep this up for 1000 years, it might inflate the dollar by 0.1%.
Use advertising! (Score:5, Funny)
Kim, don't copy that dollar! You wouldn't steal a movie, would you?
~Loyal
Privacy (Score:3)
False Flag (Score:3)
The argument of this article smells all wrong to me. It was just a month ago that I speculated someone whether paper currency would be banned in our lifetime, and now here's an article arguing for that. Note the following about TFA:
(1) The article spends several paragraphs finger-wagging at North Korea and what dastardly bastards they are. (Although, "That sounds like a lot of money, but compared to the $1 trillion in cash circulating in the great ocean of commerce, a few hundred million is chump change... probably won't bring about a crisis of faith in our paper money anytime soon. ").
(2) Then near the bottom the article switches to a call to get rid of all paper currency, with a nice jab at "liberty" voters (as some call them), lumping the ACLU in between crazed militias and the Russian mob ("If killing all cash strikes you as a little too radical... At the risk of infuriating cash-hoarding militia members, anonymity-obsessed ACLU'ers, the U.S. Treasury, Russian mob, Laundromat owners, and just about every person who has ever hid a purchase from a spouse or income from the government, I would say this to Kim Jong-un and his posse of counterfeiters: Bring it.")
(3) Ultimately, the headline about North Korea is really just a tiny degree away from "terrorist" fearmongering -- and at the end, it casts off even that garb and goes all-out terrorist/ drug-dealer/ child molester on us ("Who would be most inconvenienced if Washington were to outlaw $100 and $50 bills tomorrow? Cartel bosses in Juarez, Mexico jump to mind. So do human traffickers in China and Africa, aspiring terrorists in Afghanistan, wildlife poachers, arms dealers, tax evaders, and everyday crooks..."). So long as it potentially, minimally inconveniences some "bad guys" then of course it's worth it, even if "killing all cash" (the actual argument) means the end of privacy and convenience for all of us.
Barf. I cull FUD and bullshit. Digital surveillance of every monetary transaction by the government -- that's real end-game here.
The end of privacy (Score:3)
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.
Bullshit. Money laundering became a crime in the US over 25 years ago as an anti-drug strategy. Clearly it didn't work, since drugs are cheaper today than they were back then, but every time you make a cash transaction over a few thousand dollars (can be as little as $2000, depending on the transaction type) a notice goes off to the government. From what I can see the net effect is if the feds want you they can bust you for spitting on the sidewalk then force you to plea bargain by threatening a 300 years sentence on financial crimes.
And it's hard to imagine what Washington couldn't know about you if every single transaction you made landed in some government database. Not that it will make any difference to the criminals - drug traffickers and pimps (and their customers) will start using euros, yen, pesos, or drugs as mediums of exchange. Or gold, or bearer bonds. Whatever.
Re:First Copy (Score:4, Funny)
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: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)
Re:OOH! SCARY STORY! (Score:5, Informative)
Let us say this right, They want to remove paper money from the hands of U.S. citizens, going electronic will do nothing to stop large cash transactions around the world, they will just switch to British Pounds, or even Hondoran Limpira
Re:OOH! SCARY STORY! (Score:5, Funny)
In fact there are three freely convertible currencies in the Galaxy, but none of them count. The Altarian Dollar has recently collapsed, the Flainian Pobble Bead is only exchangeable for other Flainian Pobble Beads, and the Triganic Pu has its own very special problems. It exchange rate of eight Ningis to one Pu is simple enough, but since Ningi is a triangular rubber coin six thousand eight hundred miles along each side, no one has ever collected enough to own one Pu. Nigis are not negotiable currency, because Galactibanks refuse to deal in fiddling small change. From this basic premise it is very simple to prove that the Galactibanks are also the product of a deranged imagination.
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It is something Douglas Adams came up with.
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.
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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? ... Retailers feel, and rightly so I would estimate, that the cost of not accepting credit cards is too high.
You are pointing out that retailers think accepting credit cards is better than not accepting credit cards. It does not necessarily follow that a credit card transaction is preferable to a cash transaction. My anecdotal evidence from wo
Re:OOH! SCARY STORY! (Score:4, Interesting)
Small retailers prefer cash. Big retailers prefer credit.
The difference is administrative costs. In a small business, the cash is largely handled post-transaction by one of a few people. It can be counted quickly and dropped off at the bank on the way home. This becomes quickly inefficient for a very large business.
Small business example: Used book store with a couple employees. Even if all of the transactions are cash, it's at most a couple thousand a day that needs to be counted and deposited. The owner spends so little time every day on that process, that he doesn't even allocate a cost to it in his mind. Basically, it costs him $0 to process the cash, but 3% to process credit cards. (This is an actual real-world example, btw.)
Large business example: A large Walmart SuperStore can do $80 million of sales in a year. That's over $200,000 a day. Imagine the cost of counting, securing and transporting that amount of cash every day. Esepcially since most of the people who would do that would be on hourly pay. So Walmart could pretty much exactly determine what most of those steps would cost. PLUS, Walmart gets a much better deal from the credit card company. Probably closer to 1%. So let's say Walmart could get rid of most of the cost of moving around $200,000 a day, and it only costs them something like $2,000. Quickly starts to make a whole lot of sense.
Re:OOH! SCARY STORY! (Score:5, Interesting)
I agree with you on this point. Retailers do feel that way.
If it really was sucking retailers dry like that, wouldn't they just choose not to accept the card?
That is like the argument that if taxes are too high, then nobody will open a business, with the end result being that 100% of businesses would close. In the real world, businesses accept the federal/state/local tax, and accept the visa tax.
Consider this though- My company (retail sales) pays more money to Visa in card fees than we pay to the government in taxes. The government provides roads, education for employees, police & fire emergency responses, laws and just general positive effects by not having anarchy. Visa provides
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do you mean that credit cards must be useful since merchants take them? or are you committing a broken window fallacy?
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: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:OOH! SCARY STORY! (Score:5, Interesting)
I don't want to pay the fees. My Visa cards adds 3% to the rate. I would not call that good either.
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Get a better credit card. Just google for "credit card with no foreign transaction fee" (without quotes) and you'll find plenty.
Re:OOH! SCARY STORY! (Score:5, Informative)
Actually, as a followup to my previous post, if you want a specific recommendation, try the penfed platinum rewards card. no foreign transaction fee, no annual fee, 5% back on gas, 3% back on groceries, 1% back on everything else. You can also get a $250 sign up bonus at the moment. Although penfed is designed for federal employees, anybody can get in. If you don't have a qualifying relative, then the easiest way to get in is to make a small one time donation ($20, I think) to one of the military charities listed. I did years ago, and it's easily paid for itself 100 times over. They've got great car loan and mortgage rates.
Re:OOH! SCARY STORY! (Score:5, Funny)
I would rather not have to carry a suitcase full of money through the airport.
Rich people with their problems.
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Which is why I regularly get $300, in $20's from the ATM, then promptly step up to the bank counter (next to the ATM in my grocery store) and ask for 200 of it to be changed to $50's.
It is a lot easier to sit on a literally thin wallet, but it sucks to be broke, and 20's don't go very far.
Last summer, I purchased a used car for cash - $8000 in $100's is a fat enough envelope, paying with $20's would be retarded. (And yes, paying in cash was a reasonable thing t
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).
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Bullshit.
Look at places where this has actually happend. Zimbabwe for instance. They use some other kind of normal paper currency.
A dollar might get you 3 eggs and a gold ring would get you the same. Convertible currency is worth more under those conditions than gold or silver.
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Oh, my bad, they're actually produced by the Bureau of Engraving and Printing - on behalf of the Federal Reserve and at cost to the FR of around 4c per note (regardless of denomination), but the FR are the only body authorised to *issue* them.
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No, see he's resolving the symbolic link (puppet) to China. :P
Re:paying their due (Score:5, Informative)
North Korea has an estimated $20 billion debt. [wikipedia.org] That's debt, as in money _they_ owe to other people, mainly Russia. And that's after Russia forgave them for about another $8 billion. I don't think anybody owes North Korea any money, and even if they do it is far exceeded by the amount they owe everyone else.
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Citations needed.
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