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Remarks

Alan Greenspan
Chairman
Board of Governors of the Federal Reserve System
Washington, D C

Announcement of
New Currency Design
U S Treasury
Washington, D C
September 27, 1995

Thank you, very much, Mr Secretary. I needn't tell you that the Federal Reserve
is quite pleased to be part of this event
As many of you know, the Federal Reserve has the responsibility of putting
currency into circulation through the banking system
These newly designed Notes will be handled in the same way as older currency
Depository institutions obtain the currency they need for their customers from
their district Federal Reserve Banks, and they dispose of surplus currency by depositing it in
their Reserve bank accounts
In this process of receiving and paying out currency in response to the needs of
depository institutions, Federal Reserve Banks ~ as they count incoming deposits ~ also have
the opportunity to determine whether each Note is in good enough condition to be recirculated
and to verify each Note for genuineness
Approximately two thirds of all Notes received by the Reserve Banks in incoming
deposits are fit enough to be recirculated
The remaining third ~ which are worn out or soiled — are destroyed and replaced
by new Notes obtained from the Bureau of Engraving and Printing
On average only nine Notes in every million are found to be counterfeit
The introduction of the new currency will work this way
The new $100 Notes — the first in the series — will be ready for circulation in
early 1996
As banks deposit Notes in the regular course of business, the Federal Reserve
Banks will replace any older design Notes with Notes of the new design
All existing Notes will continue to be legal tender
The new designs of $50s, $20s, $10s and $5s will be introduced individually over
the next several years
The 12 Federal Reserve Banks and their 25 branches around the country provide
currency to the depository institutions in their territories as the depository institutions need it

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Consequently, not all depository institutions and not all depository institution
customers will be seeing the new $100 Notes immediately.
I want to assure you that the United States has never recalled its currency and will
not do so now.
Old Notes will not be recalled or devalued.
The United States has always honored its currency at its full face value, no matter
how old
Our currency is trusted and accepted by people throughout the world Because
of this special status, the protection of our currency from counterfeiting has long been a priority
.. So, rest assured that the Department of the Treasury and the Federal Reserve
System remain firmly committed to that goal.
And now, Mr Secretary, I believe we are ready to introduce the redesigned
currency.