Weekend Wars: Paper vs. Metal
Wherever you go throughout the world you are likely to find hard metal currency. I remember my first trip to England years ago and the confusion caused by holding the equivalent of $20 worth of coins. I made some beggars inadvertently very happy.
Decades later I find myself not knowing what to think about America’s own attempts to go metal. It seems that as though the icing on the crisis cake sprinkled by Congress is $1 billion worth of dollar coins that nobody wants.
Unused dollar coins have been quietly piling up in Federal Reserve vaults in breathtaking numbers, thanks to a government program that has required their production since 2007.And even though the neglected mountain of money recently grew past the $1 billion mark, the U.S. Mint will keep making more and more of the coins under a congressional mandate.
The pile of idle coins, which so far cost $300 million to manufacture, could double by the time the program ends in 2016, the Federal Reserve told Congress last year.
Whether the public actually does or does not want to use this money is beyond me. I remember the coins and generally found them mildly annoying. Then again I am not a fan of man purses and fanny packs. Regardless on those feelings, however, one thing is certain.
So, there are now about 1.2 billion dollar-coin "assets" chilling in Federal Reserve vaults, unloved and bearing no interest. By the time the presidential coin series finishes, and there are coins honoring all past presidents, there could be 2 billion.
Not that a couple of billion is much in the grand scheme of things, right? That’s what I hear every time I bring up a measly ten, fifty or one hundred million of waste. Why should it be any different because of the nine zeroes involved?
Still, my inner conspiracy theorist cannot help to think that in a time of crisis such as today, centralized authority fears anything that could even spark the notion of a gold or silver backed currency. I have yet to read anything about the coins’ metal content, but I highly doubt that they are made of brass alone.
So what say you, monkeys…would getting a metal based component of currency involved in the economy be a good thing? Is another two billion just a drop in the bucket and not worth the conversation? Can we afford to ignore assets which could be appreciating? Just a few thoughts to get your brains warmed up for the week ahead. Take it easy.
It's just so inconvenient. I assume it's an anti-counterfeit measure and could save money, but unless people switch to credit or start carrying coin purses I doubt anyone will really use them. I mean, I read about this a few days ago and I had thought that the only $1 coins were the ill-received Sacajawea coins. It' also more expensive to transport and manufacture coins than paper. Idk the cost-benefit analysis done (how much it could curb counterfeiting to the cost of manufacturing) but I would probably never use the coins.
I never held coins with me back home, loonies or toonies were bullshit too, saved em up in a jar and rolled. Now in London always somehow rack up those 1p coins as well but really prefer using cards even for small purchases. Coins are just so inconvenient... unless youre old.
Currently there are three dollar coin series in production: The Presidential $1 Coin Series (begun in 2007), the Sacagawea Golden Dollar (first issued in 2000), and the Native American $1 Coin (first issued in 2009). There will be 4 new Presidential coins and 1 new Native American coin issued for the next 5 years minimum. This program was created by the Native American $1 Coin Act (Public Law 110-82).
Its seems these coins are to enrich the government coffers by creating "collector's coins", but no one collects them anymore. Example, do you even look to see what State the quarter in your pocket commemorates?
At 30 cents per coin, it makes more sense in a fractional currency world to just print more $20 bills...much cheaper!
BTW, the coins are Manganese-Brass: 88.5% Cu, 6% Zn, 3.5% Mn, 2% Ni
http://www.usmint.gov/mint_programs/$1coin/
Go to mint.gov and look at all of the crap they have for sale. I agree that the bullion coins are a good idea, but constantly changing the penny to reflect the life and times of abraham lincoln every 4 months because our president thinks he's the second comming of lincoln is just silly. A box of nickles is a good investment that has a melt value above face.
While your statement is accurate, there is more value in the metal of a newly minted nickle than its printed value, the complete cost of smelting the currency when you factor in set up and energy costs, you'll do well to break even.
Edit Horribly flawed logic-- drinking and posting = Bad things...
http://www.coinflation.com/
While your statement is accurate, there is more value in the metal of a newly minted nickle than its printed value, the complete cost of smelting the currency when you factor in set up and energy costs, you'll do well to break even.
Edit Horribly flawed logic-- drinking and posting = Bad things...
http://www.coinflation.com/[/quote]
John Paulson has had the mint deliver special truckloads of nickles to his fund. Some can look past the smelt cost.
Quia nesciunt eius illum autem et. Quisquam quidem distinctio velit voluptate consequuntur. Omnis harum itaque sed.
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