The term 'Currency' is included in the Economics edition of the Financial Dictionary. Get your copy on Amazon in Kindle, Paperback or Audio edition. Choose your edition here...
Currency is also known as money that is accepted by businesses, the public, and the government as payment for goods and services. This includes paper notes and coins that a government issues and that circulate around a country and its economy.
Internationally, currency can be used to pay for imports in the balance of payments. Since ancient times currency has always formed the medium of exchange for trade. Currency has evolved over the years from gold and silver coins to bills that represent them to paper money that is today backed only by faith and trust in the government that issues it.
The U.S. currency has become the most heavily used reserve currency and medium for exchange around the globe. In the U.S., the BEP Bureau of Engraving and Printing creates currency in the form of the U.S. dollar. They produce literally billions of dollars of this currency every year and deliver them to the Federal Reserve System. These bills are known as Federal Reserve notes but are more commonly called dollars. The Federal Reserve states that there are around $1.4 trillion in these bills in circulation.
Keeping up with this incredible demand for dollars currency is not easy. The BEP proves to be among the biggest such operations for printing currency in the globe. They maintain operations in both Washington, D.C. and Forth Worth, Texas. Times have changed considerably at the BEP from its humble origins in 1862. In those days, they produced this currency on a machine that the small group of operators cranked by hand. They did this in the Treasury building basement.
Nowadays they utilize impressive technology that involves a cutting edged manufacturing process to produce the American paper money. The personnel doing this work are craftsmen who are extremely well trained and very skilled. They work with specific equipment and state of the art technology that utilizes the time tested historic techniques for printing. The production process involves a number of specific steps.
Counterfeiting has created a challenge for the BEP. They redesigned the U.S. currency to defeat the criminals who counterfeit the dollar bills. Special background colors have been added to these new notes that ensures it is harder to counterfeit their more secure safeguards. Such improved designs are used on the $100, $50, $20, $10, and $5 bills. These were rolled out in stages, with the new $20s brought out in 2003. New $50s followed for 2004, $10s for 2006, $5s for 2008, and the all new $100s for 2013.
The newly improved currency notes are the identical size as the prior issued notes. The images are historical with similar pictures to ensure that the bills appear and feel like other American dollars. Old security features are still utilized as well. This includes the watermark on the portraits that can be seen against a light, $5 special two number watermarks, a special security thread that can only be seen when placed to glow beneath an ultraviolet light, and better color shifting ink that shows different colors as notes are shifted.
$100 notes still have the raised printing and 3 dimensions security ribbons as in the last re-design. Counterfeit notes are still a tiny percentage of the circulating currency in the U.S. Technology advances have made it easier for computers to create realistic looking counterfeit notes.
Treasury has seen more of these computer generated fakes in recent years. This is why they chose to redesign the American paper currency so they could keep ahead of the technology empowered counterfeiters and their expanding methods for designing and printing the various dollar notes.