Hi all, guess I'm new and it's odd to have my first post go in this thread, but I just can't help myself.
Yes the lipstick case story is true, they were purchased as lipstick cases from France and also copper sheet was purchased to manufacture the cases in Israel.
About 2 million 9mm cartridges were made in "the Ayalon institute" the headstamp was EA (for Eretz Israel "land of Israel" and A for Ayalon).
While I'm not exactly sure what machines they had there my understanding is that they had everything necessary to turn copper sheet into cartridges and turn the cases into cartridges.
The idea I believe actually came from Australia, which did the reverse. A company that had made lipstick cases before WWII had switched to the manufacture of ammo.
http://150.theage.com.au/view_bestofarticle.asp?straction=update&inttype=1&intid=746
I'm not sure where the idea came from that lipstick cases would be too thin, my grandmother had a few from the 40's and they were pretty solid...it wasn't the same disposable culture as it is today, the cases were often engraved and given as gifts, the lipstick itself was replaceable. It was normally sold in just wax paper.
I would think in the time frame most of this went on 1944-1948 lipstick cases were quite probably made the exact thickness of some sort of ammo, since there were probably many trainloads of brass sheet scattered across Europe that was on its way to make ammo that had lost all demand right after the war.
I would imagine that anyone wanting to buy exports from Europe of brass sheeting, or worked brass would find many people very happy to sell. I would also imagine that there were still a large number of displaced persons and others who spent their time picking up empty brass to get a bit of eating money.
By 1948 things were back in boom in the US, but Europe was not in such good shape
My understanding is that some of the cases were given as gifts to the British soldiers to help allay doubts
As to the original topic, while it does sound like it has a number of possible holes, sometimes truth is stranger than fiction. I met a man who survived in the camps by repairing soldiers watches with minimal tools (no actual tools from his trade), he had made an entire pocketwatch out of various bits of scrap and hid it in the camp hoping he might get some chance to use it as a bribe or to trade after the war if he survived. I met him back in the 1980's and he still carried the watch. Apparently he filed the gears with flecks of stone. He said it saved his life by giving him something else to focus on during those years.
Never underestimate what people are capable of doing (or achieving) when their back is really to the wall.