What Materials Are Used to Make Paper Money?

Written by david kennedy
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What Materials Are Used to Make Paper Money?
(Money by Tracy O (http://www.flickr.com/photos/tracy_olson/61056391/))

US currency is made of 25 per cent linen and 75 per cent cotton. Threaded throughout the paper money are red and blue synthetic fibres of different length. These are used for security and as a deterrent to forgeries. The Secretary of Treasury is in charge of the designs and portraits used on paper money. In 1990, microprinting, the process of printing text too small to read with the naked eye, was introduced to deter counterfeiting by advanced copiers and printing machines.

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First Uses

Paper currency was used early in China, printable by Chinese block-printing. Paper currency had two main advantages: it was easy to carry and it saved on metallic natural resources like silver and copper. The paper money was used to make government purchases in distant areas, where the paper currency, or bank note, could then be exchanged for real money at the capital. China officially adopted paper currency during the Song Dynasty (960-1279). These notes had no actual value; they were not made with any precious material, but were still used as currency.

Silk Notes

When the Mongols came to power they created a form of paper currency called silk notes. Although the silk notes were not made of gold or silver, they did have real value in the silk yarn from which they were made. The government exchanged all old forms of paper currency into silk notes and unified the country's currency. By 1294, the silk notes were in use as far away as Persia.

Early U.S. Paper Currency

In 1775, American colonists used paper currency only backed with the promise of tax revenues to finance the Revolutionary War. The money quickly lost its value due to the lack of real monetary backing. It was also easily counterfeited. Again in 1836, when state banks had little regulation, paper currency was widely printed in a variety of colours and designs. These were also easily counterfeited. In 1863, the U.S. Treasury adopted the Treasury seal, using intricate geometric patterns and using linen paper with red and blue fibres.

Silver and Gold Standard

Silver and Gold Standards allowed a person in a country using that standard to exchange paper money for a fixed amount of silver or gold. This is when paper money was backed by real value. Although the gold standard was more widespread, the silver standard represented the idea that a precious metal could be used to signify the worth of paper money. Today, most countries use fiat money, or money that has no intrinsic value. They cannot be exchanged for a fixed amount of gold or silver but still serve all the functions of a monetary unit.

Bureau of Engraving and Printing

The Bureau of Engraving and Printing has the responsibility of manufacturing U.S. paper currency. Engravers stencil on the metal by hand because the process is harder to counterfeit then if it was automated with a computer. A siderographer transfers the metal to a soft roll. When it hardens it is used as a coping tool to duplicate the engraver's carving.

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