Wednesday, December 8, 2010

Financial Comedy


12 cents each. That's all, I swear!

You want 1.1 billion of them? That's great!

There is just one catch. Some random percentage of them will be defective due to faulty equipment and sloppy processes, and those will have to be destroyed and new one will need to be made, all at your expense.


That's pretty much what is happening in relation to the newfangled, so-called “high tech” $100 Federal Reserve Notes. Aparently there is a defect that will cause some number, as of yet undetermined, to be useless, and each one of these worthless pieces of “high tech” paper costs 12 cents.

I guess it is OK to waste so much money when you consider that the money used to pay for it is also worthless... but that doesn't make it sound any better when you consider all the stuff people can still, for now at least, buy with it.

I sometimes wonder if we waste more money implementing new anti-counterfeiting measures than we'd waste simply dealing with the counterfeiting directly. 12 cents doesn't sound like much, but that's 12 cents for each of 1.1 billion bank notes... totaling 132,000,000 dollars. If these were one dollar notes, each one would cost 12% of it's face value to create, but regardless of the tiny fraction of the cost involved with these $100 notes, 132 million dollars is still a lot of money to see disappear into thin air.

Of course, I'm sure they printed enough to compensate for it...   

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