ARTICLE: "Counterfeit Nation: America's reliance on dubious credit goes all the way back to the country's founding," by Stephen Mihm, New York Times Magazine, 19 August 2007, p. 15.

Author's book on the subject comes out next month ("A Nation of Counterfeiters"). In it, he explores our country's early (pre-Civil War) financial history, pointing out that "bank notes" were just that, a form of localized credit currency that drove our economic expansion. Since virtually any bank could issue them (they were supposed to have the equivalent in gold or silver on hand, but often played fast and loose with that requirement), they were easily counterfeited. Basically, almost anyone could set up a bank and "make money," as it were.

Indeed, America's currency itself was highly counterfeited (estimates up to one third of paper money) up to the point when Lincoln, during the war, really had the Federal government grab far more control over the situation by monopolizing--for the first time--the printing of money (better to finance the war), and thus the modern form of "greenbacks" was born, eventually driving out the bank notes as the main form of paper currency (likewise, greenbacks were supposed to be backed by federal holdings of gold, until Nixon took us off that more than a century later).

Points being: credit has always driven economic advance in this country,along with FDI from outsiders, and in those early systems there was a plethora of illicit activity.

We need to remember this as we watch the continued rapid expansion of globalization and its ongoing consolidation of the recent huge expansion that brought in all the "emerging markets" (or the globalizers who joined since about 1980). That's a huge frontier of new economic activity to be integrated, and in that integration process we will see plenty of schemes--both licit and illicit--come and go with regularity.