The E-Sylum:  Volume 5, Number 4, January 27, 2002, Article 11

TORTURING THE EURO NOTES

  The Euro rollout is generating a lot of press.   A January 22,
  2002 article in The Wall Street Journal attempts to answer the
  question: "Will Europe's new currency stand the test of time?"
  The answer?  "Maybe, provided you keep it out of the washing
  machine."   The article describes a number of tests and
  experiments designed to see how well the new currency will
  stand up to the rigors of circulation.

  "The banknotes ran a gauntlet of everyday hazards, from
  vigorous crumpling to spilled wine, and from a tumble with
  sweat-stained laundry to the kiss of a steam iron. We even
  sent them to the dry cleaners.  In the end, all the bills showed
  wear and tear. But the euro looked more haggard than some,
  losing much of the shiny hologram strip that runs down one
  edge. The 1,000-yen, 10,000-lira and 10-mark notes,
  meanwhile, came through relatively unscathed. ...Whether our
  euro's drubbing is a bad omen for the currency's long-term fate,
  only time will tell.  But the shimmering holograms that are
  designed to bedevil would-be counterfeiters certainly appear
  fragile for other currencies as well  (flecks from the one on the
  10 pounds note came back from the dry cleaners pasted to
  poor Queen Elizabeth's face).

  "If there are fewer features on a note, there's less to come off,"
  says Bert Melis, managing director of Joh. Enschede en Zonen
  Bankbiljettendrukkerij BV, a Dutch company that is printing
  euros for several countries, including the Netherlands,
  Luxembourg and Greece. "Those banknotes are not made out
  of steel."

  "Since the Jan. 1 launch, euro bills have gone through numerous
  public tortures in their short street lives by media and consumer
  groups. The European Central Bank generally declines to
  comment on the many tests, including the ones by the Wall
  Street Journal Europe. But Peter Walter, head of the German
  central bank's banknote division, which is responsible for
  printing about a third of all euro banknotes, says simply: "A
  banknote wasn't made to be washed."

  That didn't stop a German laboratory from sniffing out small
  quantities of toxic chemicals on 10-euro notes, prompting
  consumer magazine Oeko Test to warn that they should be
  considered poisonous. That earned this response from ECB
  board member Eugenio Domingo Solans:  "There is a product
  in the ink which, if you ingest 400 notes, becomes toxic," he
  said. "So, besides being expensive, it is not recommended to
  eat euro notes."

  "Printers and central bankers have tried to make banknotes
  more robust ever since they came into widespread use in
  10th-century China. But their task has always required a
  balance between making bills stand up to the wear and tear
  of daily use, and making them difficult for amateurs to
  reproduce -- a much greater challenge in the days of personal
  computers, fancy scanners and printers.

  The euro reflects European central bankers' love of anti-
  counterfeiting technologies, such as intricate water marks,
  holograms and special inks that change color when the light
  shifts. They're used even on the smallest 5 euro bill.

  The U.S. Bureau of Engraving and Printing, meanwhile, has
  been conservative about adopting such whiz-bang features,
  particularly on the small-denomination bills that take the most
  punishment. The upshot: euro bills cost an average 8 euro
  cents to produce, compared to 4 U.S. cents for dollars."

  When the U.S. redesigned some bills in 1996, printers
  considered adding holograms, but decided they were too
  fragile. "It's a very thin piece of foil," says Thomas Ferguson,
  director of the U.S. Bureau of Engraving and Printing in
  Washington. Even without the hologram, when it comes to
  thwarting counterfeiters, "we think the dollar stands up well
  against other currencies," he says. "It's just not very flashy."

  [Next time you're in the company of currency collectors,
  try working the name "Joh. Enschede en Zonen
  Bankbiljettendrukkerij BV" into casual conversation...
  -Editor]

  Wayne Homren, Editor

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