by James Buchanan

On June 3rd, two Japanese were caught in Italy attempting to smuggle $134.5 billion in US bonds in the false bottom of a suitcase to Switzerland. An article on Motley Fool confirmed that Japan holds $686 billion in US bonds. The bonds that were being smuggling were reportedly bearer bonds, which can be transferred around much like cash. (Although you might want to check their serial numbers and history before paying $500 million for one.) One strong possibility is that the Japanese were trying to dump US bonds in exchange for euros. Obviously the bearer bonds could be sold with the least attention –assuming the people assigned to do this don’t get caught smuggling them. If these bonds are real, this could have a catastrophic effect on world confidence in the dollar. The US government issued a speedy denial regarding the authenticity of these bonds, but not everyone believes this denial.

A recent update on the $134 billion US bond smuggling incident reports “One other important, but ignored story: Italian authorities say they have arrested two Japanese men who were smuggling $134-billion (U.S.) of undeclared U.S. bonds into Switzerland. Police said the two suspects were carrying a total of 259 bonds, including 10 with a value of $1-billion each and 249 with a value of $500-million. Since then, it is sketchy but it seems that the Kennedy bonds were fake. However, the only way to make a fake bond is to have a real one to look at. Where did they get a billion-dollar bond and why would they be carrying 259 bonds? Who were they taking it to? What does this mean to the US? It is considered the largest smuggling case in history, yet barely a word has been written about it. I find that strange.”

This article makes an excellent point: Assuming the bonds were fake, why isn’t this incident getting some press for being the crime story of the decade? Why has the story dropped so far off the radar that only a few news outlets in Asia and a few perceptive bloggers are taking note of it. To add to the strangeness, the suspects are apparently no longer in Italian custody. Was the Japanese government involved? Was it organized crime? Think about what they’re telling us: “Nothing to see here. Only the world’s biggest attempt at counterfeiting.”

The very bizarre media handling of this story could be because the Japanese really were trying to unload their US bearer bonds because the world is losing confidence in the dollar. There is a large coordinated effort to cover this up (combined with the laziness of certain reporters and an unwillingness to think beyond what a US government spokesman tells them). If this were a counterfeiting incident, the details would be getting published as soon as they came out.

Another article reports “At least the Japanese press is still interested in [the] story of the two Japanese men caught with some $134.5 billion in (presumably fake) US bearer bonds. We can’t read Japanese, and Google Translate isn’t particularly helpful, but a reader informs us that the gist of this story is that a newspaper sent a reporter to Como, Italy and found that the men had been released, with their whereabouts unknown. Now, the easiest, most-benign explanation for this whole thing is that it’s just a counterfeiting scheme. Fine, but then why do you let them go… ”

How could they let the biggest counterfeiters of all time go? Is this a new “catch and release” policy for counterfeiters? We’ve all seen the gigantic amount of media attention that Bernie Madoff has gotten. But Madoff simply ran a Ponzi scheme involving a “paltry” 60 billion dollars. These smugglers had $134.5 billion in (allegedly fake) US bonds. Now which is the bigger crime story??

US authorities have claimed that only about $103 billion in bearer bonds are in circulation. US authorities also claimed that the bonds were “fake” –apparently before even looking at them. The bonds were still in Italian custody as of June 18th, and a US Treasury department spokesman called the bonds fake also on the 18th. Both of these denials are somewhat suspect because the US government has a HUGE interest in making this story go away.

One thing is certain: The official story from the mainstream media makes no sense whatsover. Could it be that the Obama-loving liberal media does not want a panic to start over the worth of the dollar? Could it be that the Japanese were trying to dump their US bearer bonds in exchange for euros? Enquiring minds want to know.