Friday 5 September 2008

 

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Clemency Burton-Hill
Clemency Burton-Hill

Clemency suggests


Currency Wars: Forging Money to Break Economies

Sounding a false note

John K. Cooley
Constable, 350pp, £18.99,
William Leith
Wednesday, 26th March 2008

William Leith on John K. Cooley's new book

In this book John K. Cooley, who has spent a lifetime writing about international intrigue, investigates the subject of forgery. More specifically, he looks at the way people have tried to use forgery as a way of waging war or seizing power. It seems like a terribly dry subject at first — lots of stuff about currency and exchange rates and the gold standard. You need to concentrate. But it’s a fascinating subject, and by the end, this book really made me think.

First of all, I had the impression that counterfeit money is quite a rare thing. Not so, says Cooley. As long as currency has existed, people have been forging it. For instance, early pilgrim settlers in America traded with native Americans in their currency of seashells. Dark clamshells were worth twice as much as the white shells of periwinkles. But both sides began to cheat. The settlers made fake shells from porcelain, and the native Americans used dye made from berries. After a while, everybody lost faith in the currency, and it collapsed.

Forgery exists wherever you look in history. Whatever the currency, people will be hard at work, somewhere, trying to copy it. Ancient Greeks and Romans clipped bits out of coins and melted them down. Then came paper money, which can be easy to forge, given the right technology. Right now, says Cooley, the world is awash with ‘Supernotes’ — US dollars forged so expertly they pass muster even when banks check them. ‘No detection device is perfect,’ says a banknote inspector interviewed by Cooley. And sometimes, ‘a genuine note is given a bad reading because of dirt, tearing, or other acquired imperfections’. So the whole thing is a grey area. And when forgeries exist, neither the forgers nor the authorities want to publicise the fact.

Cooley’s main focus is the use of counterfeit money as a weapon. The idea is that, if you print your enemy’s money, and release it into the system, you will destabilise his economy by causing inflation. Just about everybody does this. Hitler did it. Stalin did it. William Pitt did it, to damage both the American and French currencies. The British tried to ruin the Kaiser in the first world war. The CIA did it to Castro. A crook called Alves Reis almost seized control of Portugal as recently as the 1930s by forging money. And the North Koreans and Iranians are supposedly printing dollars, possibly millions of them, as we speak.

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