Money is fake. So, you have to wonder what all the fuss was about when businesses in downtown Iowa City went into panic mode after seven instances of counterfeiting were reported over the past six months.
The Daily Iowan notes that the Bread Garden Market, a popular business located on the Pedestrian Mall is no longer accepting $50 bills because the counterfeit ones are so realistic they even fool the banks and those machines designed to identify homemade money. And while a person unwittingly in possession of counterfeit currency isn’t necessarily in legal trouble, they are stuck with bills that literally aren’t worth the paper they’re printed on.
Counterfeit money is only slightly different from cryptocurrency that has recently led to the collapse of two major banks having significant exposure to cryptocurrency. And while, say, Bitcoin isn’t technically fake currency, it isn’t backed by a government and is created by “mining”, a curious process of complex computer number crunching which, unlike most forms of labor, produces nothing of real value except scarcity. Bitcoin is only considered to be money because some people agree that it is.
What we think of as real money is disturbingly insubstantial. Tony Greenham, of The Economics Foundation in the UK, explains that money can be loosely defined as “anything widely accepted as payment.” He points out that only about 3 percent of the economy’s money is cash. “Commercial bank money—credit and coexistent deposits—makes up the remaining 97 percent of the money supply.” In other words…thin air. Greenham explains that money isn’t so much about a physical thing like gold or real estate, it’s “a relationship of credit and debt.”
Counterfeiting used to be much more common in the United States. In 1865, the Secret Service was created, not to protect the president as it does today, but to combat counterfeiting, which, at the time, accounted for one-third to one-half of all the money in circulation.
The most prolific American counterfeiter of all time was Frank Bourassa who, burned out from working 20 hours a day, running a brake factory, turned to making money another way and beginning in 2004, printed $250 million in $20 bills that were virtually indistinguishable from the real thing. Like most counterfeiters, Frank’s greed was his undoing. The feds finally caught up to him in a rented farm house, equipped with special paper, ink and printing presses valued at $325,000 Canadian. In exchange for a greatly reduced sentence, Frank agreed to help the Treasury Department catch counterfeiters.
The most elusive counterfeiter in American history was Emerich Juettner, a 70-year-old New York junk collector from Austria who, in 1938 began printing $1 bills that were so laughably crude, the Secret Service assumed the counterfeiter was taunting them. The printing was fuzzy, the text was misaligned, Washington’s eyes were just two black dots and the president’s name was misspelled “Wahsington”. And yet, it took the feds ten years to catch him because he never printed more than fifteen dollars in a week and never passed one of his fake bills to the same person twice, he said, “so nobody ever lost more than $1.”
Juettner was facing three felony counts, each carrying a 10-year stretch. But when he was arrested, the judge, amused at the grinning, toothless, 5-foot-three-inch junk man, sentenced him to one day in jail and fined him $1.
In 1950, an Academy-Award winning movie was made about Juettner’s life, ironically providing him with a comfortable retirement. When a reporter from the New York Daily News asked him if he was ever tempted to return to a life of counterfeiting, Juettner replied, “No. There wasn’t enough money in it.”