Stationed in Italy after Victory-in-Europe Day, I fell in love with the country, but as part of an occupying army, was insulated from Italian life. We lived apart and were paid in Allied Military Currency—scrip—bills of 2 to 1,000 lire, 100 lire to the dollar. Scrip was soft money, but 10,000 lire in scrip bought a
one hundred dollar postal money order. Sent home and deposited in an American bank, it was one hundred hard American dollars.
You could go to any PX, buy a pair of army shoes for $5, walk a block, sell them to any street black marketer for $35. A Waltham wristwatch cost $20, sold for 100. You could take R&R in Switzerland, for five bucks each buy what looked like watches and back in Italy when a black marketer sidled up, “Hey, Joe, sell watch?” get fifty. But the big money was in cigarettes. The PX sold cartons for 50 cents, resold for $10 to $15. You could buy only one carton at a time so GIs would write home, have twenty cartons sent. At mail call: “Schultz! Here’s your cigarettes,” and a bulky package flew through the air.
There was money-changing in Cairo. You borrowed enough to arrive with $1,000 in scrip. At the base exchange you changed it into hard Egyptian pounds. Outside the base were horse drawn carriages on which were painted white X’s, meaning “Off Limits.” You got in and changed your Egyptian pounds for scrip at 2½ to one. Now you had $2,500 in scrip. You went back to the base, did it a second time ending with over $5,000. The base exchange knew but let you get away with it unless you tried it a third time. Some made the Cairo trip weekly.
There were things that crossed the line: selling gasoline, food from army mess, military supplies like parachutes, out of which beautiful dresses could be made. One lieutenant signed out a weapons-carrier (like today’s Humvee), drove twenty miles near the coastal town of Manfredonia where salt was harvested from the Adriatic Sea, filled up the carrier, drove sixty miles into the mountains, sold it for ten times what he’d paid. He was your basic entrepreneur, taking a product from where it was surplus to where it was scarce, but using an army vehicle for private business was illegal, he was nailed, and dishonorably discharged.
One night, we were waked at 3 AM, told to take every lire and go to the pay line where it was exchanged for new Italian notes at a rate of 400 lire to the dollar. The new notes were hard currency. In the PX, a carton of American cigarettes still cost fifty cents, now 200 lire, and the black market markup was a quarter what it had been. The G.I. piñata was empty.