Posts Tagged ‘United States Treasury’

The Color of Money: Why is a Greenback Green?

Monday, February 9th, 2009

1 Star2 Stars3 Stars4 Stars5 Stars (1 votes, average: 5 out of 5)
Loading ... Loading ...

greenbackIn 1929, when the United States Bureau of Engraving and Printing introduced the small-size note, that we currently use today, green pigment was readily available in large quantities.  The color was relatively resistant to physical and chemical changes, and the color was viewed to be psychologically identified with the security and strength of the United States Government.

More importantly, this newly developed ink had protective qualities that could not be easily “lifted” from the note itself, which had been a favorite technique of counterfeiters in the past.  Since the mid-1800’s, it had been customary to print bills in black, with different slight variants of color.  When photographed, the color variants would show only in black, since early cameras could only photograph in black.  Not to be outdone, the counterfeiter soon discovered that they could remove the colored elements from the Bill, photograph the remaining black ink elements, make copies, and then overprint an imitation of the colored parts on the newly made copies.

A new solution was needed, and was quickly developed. The development, as well as the patent purchase for this ink, was by Tracy R. Edson, who later Founded the American Banknote Company, one of the same firms that produced the first currency used by the United States.

The faces of these early notes that were produced under contract were printed with the newly patented green tinted protective ink.

When printing with oil-base type inks, like the new “patent green,” it is not unusual for the color to show through to the opposite side of the sheet.  Therefore, the backs of early notes were printed in a darker shade of green to make the “strike through” of the tint less obvious.

The transition to the Treasury Department’s Bureau of Engraving and Printing was gradual, so the backs of the notes produced there during the intervening period were continued to be printed in green for the sake of uniformity.

Once the Bureau was in full-scale production, there was no reason to change the traditional color, and it was only logical that the practice continue.

Thus, the “greenback” was born!

The Bureau currently uses a technique called “Intaglio Printing,” which involves a revolving plate, filled with the grooves containing the design and wording.  These grooves are filled with ink and then wiped clean on the surface.  The paper is forced with approximately 20 tons of pressure onto the plate, picking up the ink contained within the finely recessed lines and grooves, leaving the surface of the newly printed currency with a slightly “raised” feel, while the reverse has a slightly indented feel.

Thanks to new technology introduced in the last few years, the newly redesigned, recently introduced United States Currency features some new splashes of color on the various denominations, using an “Optically Variable Ink” (or OVI).  This ink allows a shift in color variation when held at different angles.

A copy machine, for example, scans a document at ONE FIXED ANGLE, relative to the bill’s angle when placed on the glass, thus not picking up the color shift.

This ink, produced by a Swiss company called SIPCA, is not readily available and thus aids in deferring counterfeiting.

So, the next time you reach in your wallet and pull out a Greenback, you’ll know why it’s green!

What Happens to Defaced Currency?

Sunday, December 21st, 2008

1 Star2 Stars3 Stars4 Stars5 Stars (4 votes, average: 5 out of 5)
Loading ... Loading ...

defaced currencyIt is illegal to purposely deface, mutilate, impair, diminish, falsify, scales or lightens any coins minted or “coined” in the United States of America. However, the U.S. government will replace worn out or damaged money if three-fifths of it is still identifiable. Two-fifths will earn the bearer half the face value; less than that gets nothing. Every year, the U.S. Treasury handles over 30,000 claims of destroyed or badly damaged currency. But what happens to money that becomes unrecognizable or “mutilated” through unintentional means?

There are numerous ways that currency can become “mutilated”. The most common causes are fire, water, chemicals, explosives, animal, insect, or rodent damage, and deterioration from burying paper currency. If more than half of the money is identifiable and evidence relating to what happened to the remainder of the money indicates that it was completely destroyed, it is possible for money to be replaced however, special steps must be taken to ensure the authenticity of the currency and the condition of the remaining portions of the paper bills. Special experts are employed by the Treasury Department to examine mutilated currency. These individuals carefully investigate all mutilated money received and are responsible for okaying the writing of a Treasury check for the value of the currency as they determine to be redeemable.

It is important to note that paper money can become badly soiled, defaced, disintegrated, worn, and torn through the ordinary exchange of hands. If more than half of the original note is left and special examination of the note is not required, the money is not considered mutilated. These funds can be taken directly to a bank and exchanged for a replacement. The money is then sent to the Federal Reserve Bank to be exchanged for new bills. The serial numbers of the worn-out money are recorded and then the bills are destroyed. Damaged coins are returned to the Treasury for re-minting, meaning they melt them down to make new coins.  Mutilated currency however needs to be mailed or delivered to the Bureau of Engraving and Printing in Washington, D.C., with a letter indicating the estimated value of the currency and an explanation of how the currency became mutilated. Special care should be taken to ensure that the bills are left in the same condition they were in when found.

While it is comforting to know that there are measures in place to protect currency from losing it’s value through unintentional mutilation or defacement, one should take every precaution possible to protect our currency. After all, as taxpayers, we do pay for the minting and printing of all currency and coinage in the United States. Try to keep money safe by avoiding letting your wallet run through the washing machine, or leaving money lying around where it can be damaged. Also, please don’t write on bills ad this may cause them not to work in vending machines or not to be accepted meaning they will need to be replaced sooner than ordinary.

More On The United States $1 Bill

Wednesday, November 26th, 2008

1 Star2 Stars3 Stars4 Stars5 Stars (No Ratings Yet)
Loading ... Loading ...

Like the rest of the United States currencies, the one dollar bill is composed of 25 percent linen and 75 dollar billspercent cotton, with red and blue synthetic fibers distributed throughout the paper. The notes weigh one gram each and are 2.61 inches in width and 6.14 inches in length, with a thickness of .0043 inches. The United States one dollar bill is worth one hundred United States cents.

The United States government spends 4.2 cents to produce a single dollar bill and dollar bills are printed by the Bureau of Engraving and Printing, also known as the BEP. The Bureau of Engraving and Printing produces well over than sixteen and a half million one dollar bills every day, and most of these notes are used to replace older and worn out dollar bills which are no longer deemed fit for circulation. The average dollar bill has a life span of about eighteen to twenty-two months, depending on frequency of usage, and wear and tear. The United States Treasury estimates that there are billions and billions of one dollar bills which are circulating the globe to date.

The first one dollar bill was issued as a Legal Tender Note back in the year 1862. These early one dollar bills featured the portrait of Salmon P. Chase, who was the Secretary of the Treasury under President Abraham Lincoln. Only until the year 1869, was the portrait of George Washington used on the one dollar bill, and this remains the case until today. A vignette of Christopher Columbus sighting land was also featured to the left of the note during this time.

In 1886, the picture of Martha Washington, who was also the original first lady and wife of George Washington, was featured on the one dollar silver certificate, making her the first women ever to appear on any United States currency. Presidents Abraham Lincoln and Ulysses S Grant are also amongst the few to have been featured on the United States one dollar bill, although this depictions dates to 1899. The designs on the one dollar united states note and silver certificates were more streamlined and standardized beginning 1923, with minor exceptions such as color and ink.

In the year 1929, all United States currency changed to the standard and current size we now see, although various designs and depictions continued to be featured throughout the years after. In the 1957, the one dollar bill became the first piece of United States currency to bear the legendary motto ‘In God We Trust’. The current design of the one dollar bill was finalized in 1969 and has remained the same ever since, and no plans to redesign the one dollar bill has been proposed to date, even though higher denominations from five dollars onward have been redesigned to curb counterfeiting.

The United States one dollar bill is also the most experimented and tested bill in the nation’s history. In 1933, a test was conducted to determine the different ratios of cotton and linen used in the paper of dollar bills. Another well-known test was done in 1942 during World War Two to test alternative types of paper that paper currency can be issued in. This was a precautionary measure in case the current type of paper supply ran out. In 1992, the one dollar bill was again put under the microscope when the Bureau of Engraving and Printing began testing a web-fed press, to facilitate the production and issuance of more dollar bills.

The Bureau of Engraving and Printing

Saturday, October 25th, 2008

1 Star2 Stars3 Stars4 Stars5 Stars (1 votes, average: 4 out of 5)
Loading ... Loading ...

The Bureau of Engraving and Printing is currently the largest and only producer of all legal tender United bureau engraving printingStates currency today. It prints billions of Federal Reserve Notes every year and delivers them to the designated Federal Reserve Banks, to be issued and circulated accordingly. These Federal Reserve Notes are produced at two of its current facilities located in Washington D.C., and Fort Worth, Texas. Tours are offered to the public at these buildings and it showcases the various steps of United States currency production. The tour usually begins with the process of sorting out the large sheets of blank currency papers, closely followed by the intricate methods of getting the dyes ready, to the actual printing procedures itself, and ending with the ready to be spent dollar bills.

Apart from currency production, the Bureau of Engraving and Printing also plays an important role in advising other Federal managed agencies on document security matters. It also processes claims for the redemption of all United States currency that have been mutilated. It prides itself in its continuous effort in the research and development area which focuses on the continued use of state-of-the-art automation and counterfeit prevention technologies for use in the production of United States currency, further guaranteeing its integrity.

The Bureau of Engraving and Printing began its operation in the United States Treasury building back in 1862, resulting from a legislation which was enacted to help fund the Civil War. This legislation authorized the Secretary of the Treasury to issue paper currency in lieu of coins, largely because of the slowly diminishing funds that was desperately needed to sponsor the war. Before long, in 1877, the Bureau of Engraving and Printing was entrusted with the sole responsibility of producing all United States paper currency.

Prior to this, a private firm produced Demand Notes in sheets of four, and these sheets were then sent to the Treasury Department where dozens of clerks signed the notes, with another multitude of workers cutting the sheets and trimming it down by hand. This process eventually became mechanized and was moved down to the building’s basement, giving birth to the Bureau, an important umbrella of the Treasury which proved to be efficient as well as practical.

Before it was officially recognized in congress and was given specific allocations of operating funds through various legislations, the Bureau of Engraving and Printing, in prior to the year 1875, was more commonly known as First Division of National Currency Bureau. Other of its failed labels include, Printing Bureau, Small Notes Bureau, Currency Department, and Small Notes Room.

Apart from printing currency, the Bureau of Engraving and Printing is also given the task to produce revenue stamps, treasury securities, military commissions, award certificates, invitations and admission cards, different types of identification cards, passports, forms, and other special security documents for a variety of Government agencies. This additional responsibilities which was taken on by the Bureau beginning 1894, established it as the nation’s pioneer security documents printer which responds in like to the United States Government, both in times of peace and war.

National Bank Notes

Thursday, October 9th, 2008

1 Star2 Stars3 Stars4 Stars5 Stars (1 votes, average: 4 out of 5)
Loading ... Loading ...

national bank noteInitiated by the National Banking Act of 1863, and issued through banks that were bonded by the Unites States Government, National Bank Notes were one of the more controversial United States paper currencies in history. It is said that the involvement of the United States Government in securing these banknotes was due to several factors, amongst them being its self interest to help raise money for the Treasury during the Civil War, as well as a possible political debt that the Republican Party owed to its Whig and Federalist Party antecedents. This exploit, although politically impracticable during that time, was said to be made possible by the establishment of the said National Banking Act of 1863.

Before issuing these notes, the selected federal chartered banks were required to first deposit equally valued United States Bonds or Securities with the United States Treasury as a form of collateral. This was probably because before federal banknotes were more commonly used, local banks would issue their own banknotes which was secured by nothing but their own goodwill, making it somewhat unreliable. The value of National Bank Notes, however, would still remain in case the issuing banks fails or even if the banking system becomes solvent, due to the fact that its value was somewhat guaranteed by the United States Treasury.

Also known as the National Currency, National Bank Notes were also introduced in the effort to assist local banks create a much newer and profitable system of distributing banknotes. These Federal Banks, or also known as National Banks, would print up banknotes up to ninety percent of the value of the United States Bonds or Securities they have in holding with the United States Treasury. The masses trusted these federal guaranteed banknotes better because of the lower exposure towards unforeseeable liabilities it proposes. This practice also helped guard the public against fraudulent and badly managed banks, whose banknotes might become valueless.

National Bank Notes had a very identical appearance to the paper currencies which were produced between the years 1929 and 1990’s, although they carried some distinctive characteristics. One of the most obvious difference is the names, towns, and states of the federal banks that these banknotes were issued from, which were printed on the notes itself, as well as the signatures of the respective bank’s presidents and cashiers.

In view of the fact that National Bank Notes were not completely backed by gold, the contract, like that of United States Notes, declared that they were not for the payment of duties on imports or interest on the public debt.

The reign of these National Bank Notes were short-lived though, as the United States Government ceased its circulation during the great depression, in the early 1930’s. This was probably due to the panic withdrawals of deposits by a lot of people who lost confidence in the local banks at that time.

Today, National Bank Notes are religiously collected by currency hobbyist all around the world, especially those in the United States, where these notes are fastidiously studied and kept, often fetching high value amongst enthusiasts.