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Just in case you missed it, the Tuesday before last was the final day you could’ve legally shopped with your Houblons. For those who think a Houblon is something like a dubloon, and I’ve been smoking too much of something I shouldn’t, a Houblon is a fifty pound note with a picture of Sir John Houblon on it, the first Governor of the Bank of England. Apparently, there were too many forgeries on the market. You’ve got to laugh. The Bank of England has been issuing counterfeit money through the Quantitive Easing scam virtually since most of the Western World’s leading banks went belly-up in 2007, so has the US’s Federal Reserve.
Nevertheless, however good it feels to have a few in the palm of your hand, for most of us the shifty-fifty is a real pain to get shot of. Shopkeepers look at them like they might be Burmese fifty kyat notes with funny, foreign writing they can’t read. Anyone who’s tried changing one into the sort of money you can actually spend anywhere by buying a packet of overpriced, best-eaten-before-World-War-One, cheese and onion flavoured crisps down at the corner mini-mart, will know what I mean. The way things are, you’d think they’d be grateful for the extra trade. But no, more often than not, you’re met with the type of wary look usually reserved for serial shoplifters. I mean it’s not even as if you want his mouldy old crisps. In your mind, you’re doing him a favour by taking them off his hands. You’re a brand new, cash-paying customer who only lives a few doors away. A resident with actual money, who isn’t asking for crisps on credit. You might even be stupid enough to come back and buy something else one day. But the shopkeeper’s tight-lips and stone eyes tell you, however you got your hands on that fifty, it wasn’t by doing anything honest. And anyway, it’s probably dodgy. The pain transmitted in the facial expression is enough to make you feel you farted in his wife’s face just as she bent down to pluck a particularly limp, brown lettuce for a short-sighted, old-aged pensioner out of the box in front of the counter you were standing at. As you leave in shame, you become convinced he’s phoning the police.
Things don’t go much better down at the pub. After ordering half a pint of shandy, you don’t really want, and another packet of stale cheese and onion crisps, to try to make the transaction seem worthwhile, you hand over the fifty. Or try to, at least. Again there’s the Burmese kyat expression. The eyebrows bounce up. “Is that the smallest you’ve got?” Still there’s some chance, as you hear the till slide open. But the note clips spring back and forth pointedly, and sort of emptily, as the publican examines his paltry hoard of smaller notes before sucking his teeth and shaking his head. “That’s the second one I’ve seen today, No can do, squire. Try the corner shop.” You feel about as popular as a steak and kidney pie vendor at vegan food festival. In the end you have to pay him with the crumpled fiver you were reserving for an emergency. This has become the emergency: paying for half a pint of shandy you didn’t want in the first place, and an emergency packet of stale cheese and onion crisps you’ll probly not be able to finish.
In the 1920s, before the Wall Street crash of 1929, inflation was rampant in post-war Germany. It is said workers were paid every day at lunch time to try ot keep up with it. Employers would have transport the notes in wheelbarrows. Here are two 100,000 mark notes from my collection. The one on the left was issued in February 1923. The one on the right was printed in July of the same year. Note that, not only had the value decreased incredibly, but the size was less than half, and it was printed only on one side of a much inferior quality paper. The German financial crisis played a great part in bringing Adolf Hitler to power.
Quantative Easing is supposed to save us from the same fate. The reality is cental banks are allowing inflation to build up like steam in pressure cooker without a valve. When the pressure gets too much, inflation will explode, bringing the entire global financial system crashing if sensible fiscal measures are not taken to prevent it.
When you think about it, in this day and age, with debit and credit cards accepted everywhere you go, and all the other various methods of paying on-line, what sort of person carries so much cash about their person they need the convenience of fifty pound notes? And why were they needed more than thirty years ago? when you could still buy three of pints of lager for just over a quid. Even if they did look and taste like poodle piss. Though when poodle piss doesn’t have much of a head on it, at least the poodle does.
At its introduction in 1981, the reverse side of the of fifty pound note featured a mugshot of Sir Christopher Wren, who rebuilt London after the Great Fire of London in 1666. Not on his own, I might add. The banknote quickly became a favourite amongst antique and secondhand car dealers. If you went down to Bermondsey antique market at 4am of a Friday morning or Saturdays on the Portobello Road, you’d witness hordes of shady-looking shysters peeling loads of Wrens from fat wads, so untouched and crisp they snapped, and so fresh you could still smell the print.
The same went for estate agents in the property boom of the 1980s and ’90s. There was the price in the estate agent’s window, and the under-the-table, knockdown price, in exchange for a large hunk paid in wedges of fifties that needed too much explaining.
The art world was another planet inhabited by funny-money. I remember seeing Lucien Freud pull a fat roll of fifties out of a trouser pocket at a butchers in Holland Park Avenue once. I think he was buying a Cornish pasty. The butcher was so posh a Cornish pasty probably cost fifty quid. It’s a true story, except for the Cornish pasty bit. I think it was half a pound of pork sausages. But as the great artist was almost as well-known for his love of the nags and roulette, as for his skill with hog’s hair, he might have won them at the bookie’s a couple of streets away. And there’s another business where dirty money goes in one end and comes out freshly laundered at the other: gambling. No questions asked, a nod and a wink and Bob’s your uncle.
The underworld up and down the country toasted the introduction of the half a ton. It made things far easier and less obvious than carrying oodles of grubby twenties and tens around in a large suitcase. It was as if the Treasury had purposely designed them with the criminal fraternity in mind. They were perfect for every type of crooked skullduggery you could think of.
The shifty-fifty was the drug baron’s dream come true. They streamlined the business of musclebound men called Igor, who had rings through their nipples, and drove round in black BMWs with kilos of bankers’s nose powder in the boots. Now they could get paid under railway arches in East London with attache cases instead of crates.
Robbing banks took less than half as long, if you only bothered with fifties. Bribing policemen became a doddle. Slipping a grand in a slim brown envelope under a table at McDonald’s was a piece of cake, as was stuffing it behind the cistern of the gentleman’s down at the boozer.
According to The Bank of England there’s still an awful lot of fifties floating about somewhere and a lot of them are Houblons. At the last count there was an estimated 224 million £50 notes worth £11.2 billion in circulation. Now, that’s what I call wonga.
Nevertheless, to judge by the ones in the hands of ordinary folk, you wouldn’t think there was quite so many. After all, with a population of 62.4 million it works out at £179.5o each for every man, woman, child and baby in the British Isles. Of course, that doesn’t compute into fifties exactly, but it still means a family of four should have around fourteen, give or take a couple, in their spare cash. That’s apart from all the fivers, tenners, twenties and various denominations of coins, lying about the house. Of course, for that scenario we have to assume wealth is distributed more or less equally across the nation. But, like everything else worth having, obviously it’s not.
I would go so far as to estimate the average British household never has more than a couple of fifties in the house at the best of times, and usually doesn’t have even one. If they ever do, they either need, or want, to spend it as quickly as possible. If only for the reason many smaller businesses refuse to take them, because of a fear of forgeries, or that they use up a lot of change.
Most of us rarely need more than a couple of hundred quid in cash, and it’s just as easy to carry that about in tenners and twenties.
They’re only of real use to criminals and the very rich. Entrepreneurs, who need to grease palms to secure immensely lucrative contracts, and arms dealers, who have to pay baksheesh to make sure heavy weapons are delivered into the hands of psychopaths who shouldn’t be trusted with sharp scissors, let alone firearms
The demand for high-value banknotes is far greater than you might imagine. That’s why a large number of criminals have turned to dealing in high-value euro notes over the last few years. The 500€ was quickly dubbed the Bin Laden after its introduction in 2002 simply because, though everybody knew they existed, nobody had ever seen one. Believe it or not, it was a lot to do with weight. Drug cartels were dealing in so much cash the amounts became too heavy. £1 million in twenty pound notes weighs almost 50 kilos, but £1 million Bin Ladens weighs just over 2 kilos. The equivalent of a couple of spoons over two bags of sugar. In other words, less than an attache case full.
But the fifty pound note is also still very handy when having to transport large sums of illicit cash. Paintings by famous dead painters and antiques are ‘discovered’ and bought at supposedly low prices, then sold at auction for much larger amounts, hence rendering the proceeds legal. When in reality, huge amounts of untracked, dirty money has been made squeaky clean in a jiff through the deception.
And it’s not just drug barons who will have fifties stashed at home. Judges, police chiefs and politicians are bribed with fifties, sex slaves are bought and sold, as are stolen goods. Pornographers and pimps deal in fifites. The very rich use fifties in fancy shops all too happy to issue Mickey Mouse receipts. Cash is king.
The funny thing is, despite the fact the announcement they were being withdrawn from circulation on April 30th this year, The Independent newspaper reported that an estimated 53 million Sir John Houblon notes, worth a staggering £2.6 5 billion, were still floating around. That was a fortnight before the big day. In a bid to outdo its rival, The Guardian reckoned there were 63 million notes worth £3.15 billion. But hey, what’s a few billion here and there to a country that can bail out the nation‘s major banks, whenever they get themselves into a bit of a muddle, to the tune of £850 billion?
So why weren’t there long queues of people outside banks trying to cash all their Houblons in before the big day? one might be forgiven for asking. One reason could be that nipping down to your local branch of Barclays with plastic bag stuffed with fifty quid notes could lead to being asked a few questions by the Inland Revenue, as banks are required to grass you up if you bring in more than a certain amount of cash. And they will, even though the HSBC never grassed up the Mexican and Russian drug cartels that were shifting billions using their services. It appears even drug cartels are now too big to fail.
And it wouldn’t surprise me at all if it was yet another ruse to cheat the poor out of their savings. A good proportion of the Houblons still out there are the the fruits of the burgeoning black economy. A lot of small self-employed tradesmen, like builders, plumbers and carpenters, for instance, get paid in cash by wealthy clients in possession of more than enough fifties to cause embarrassment. They’re only too eager to spend the proceeds of their shady deals on a few marble, Georgian, winged garden gnomes arranged tastefully around a fountain. Or do posh people call them putti?
Often too mean to pay a decent price for a decent day’s work, or the taxes due, they offer cash as compensation and as an inducement. With so many others in need of work, it’s difficult is to refuse during a crisis. And then it becomes the norm. A proportion of the loot gets stuffed into mattresses, on top of wardrobes, or in shoe boxes up in the attic. It’s the working class way of putting something extra by for retirement, or just for a rainy day, which can build up to a tidy sum over the years. But claiming the mattress is the poor man’s version of a tax haven might not go down to well with the tax inspectors, a breed not generally employed for their ready smiles and senses of humour.
But it’s an ill wind. Making the Houblon illegal will wipe out, or devalue, a lot of those savings, as many hoarders will be afraid of being caught with large sums of cash, even if they are perfectly legally obtained and full tax has been paid. With many people’s cash effectively devalued or confiscated, the net gainers will be the banks of course. The timidness of the poor in the face of bureaucrats with big sticks will allow the Bank of England to issue a whole new raft of Quantative Easing on the back of the billions that never get turned in.
The giveaway is in this article from The Independent. Victoria Cleland, head of the notes division at the Bank of England is quoted as saying: “We’d expect a lot to be out there. There was an increase in demand for fifties during the financial crisis”. You might wonder why there would be such a demand, and why they would still be out there seven years later. Obviously, there are an awful lot of people who just don’t want the government to know how much money they’ve earned over the years, and are wealthy enough to put a torch to it rather than get caught.
I’d sort of hoped the new fifty might picture Edward John Smith, captain of the Titanic. Instead, and rather inappropriately, there’s a picture of James Watt, inventor of the steam engine, and his business partner Matthew Boulton. The pair believed in a nation’s wealth being based on its labour force and means of production. Both men helped lay the ground for the Industrial Revolution, which made Britain the leading country for manufacturing in the world during the 19th century. Boulton also made money. Literally. He revolutionised its production by applying modern techniques to the minting of coins and struck millions for countries all over the world. His processes help beat the counterfeiters of the day. All points the Bank of England, the Federal Reserve and the entire Western financial sector might like to take note of today. Or the next revolution might not be industrial in form, but could be industrial in scale.
Copyright © 2014 Bryan Hemming
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