Start hoarding nickels?

http://www.survivalblog.com/2011/02/the_nitty_gritty_on_nickels.html

 

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While the source makes me nervous, and I do not buy his predictions, nickels we currently use will have to be changed. When that happens gresham's law will act and they will disappear from circulation just like all other higher value coins.

Unless their intrinsic value shot up from where its at now, I have better uses for my cash flow. Putting away BU rolls is always prudent, so a couple of bags of new nickels would be fine, but until I either know they are changing composition or they are worth $.15 melt, I wouldn't put more away than that. That is me though.

 

we'll ive got so much money layin around that i don't know what to do with so it made sense for me to stack some

 

It would make more sense to hoard the older Canadian nickels, which were pure nickel, not 25% like our copper-nickels. But, many have beat us to it already.

 

I've been thinking about roll searching $1000 worth for wartime ones and just keeping them all.

 

Really know very little about nickels as an inflation hedge. The link however, was an eye-opener. A sub-culture that's able to find a reason to fear almost anything. Reminds me of what Lao-Tzu said in the Tao-te-Ching. "He who does not trust enough will not be trusted."

 

Thanks for the link gbroke. I will be excluding nickels from my occaisonal trip to the Coinstar, after looking for 1964 and older dimes, quarters, and half dollars, and 1982 and older pennies. I'm not going to go looking for nickels though. Even though getting the melt value out of them may not be feasible, retaining their intrinsic value will keep them from becoming undesirable if the rest of the currency is.

 

Since you legally can't extract the nickel content from 5-cent US pieces, it makes no sense to hoard them. To be honest, I didn't even bother to click through the link. I have a pet peave against threads that are started as a link with no other commentary... seems "spammish" to me.

 

Doesn't stop people from hoarding copper cents, myself included.

 

My "pet peave' are people who comment on a thread without reading the revelant link associated with it. Those people shouldn't comment on the thread at all. Seems "lamish" to me.

 

Try telling your friends and family to "hang onto your nickels." I've been laughed at so many times, that I actually joke about it now. The fact is, a nickel's melt value is almost 40% more than it's face due to the copper and nickel inside. If you believe physical metal and paper dollars will both continue to move on their current trends, then buying nickels is a great investment. It doesn't matter that you aren't legally allowed to melt them. All that matters is that they can't be inflated away. The Federal Reserve Corp can't create a billion more with the press of a button. They are real and will be hoarded/collected once the gov't changes the composition of nickels to something less valuable in the near future.

Isn't that funny. The Gov't does't want our money to be "too valuable." I read a lot of posts on this site from people who own little to no PMs. I highly recommend purchasing nickels if you are looking to get into the metals game, but don't have the capital for gold and silver. What do you have to lose? You can always get your $.05 back. It's one of the last few forms of arbitrage left.

 

i agree but have to add that a holder of PM's is considered to be a "hard asset" advocate and in my book nickels are an excellent hard asset with the ability to buy below cost. it always amazes me why these pm holders always bash nickel hording

 

^^I don't

 

If your goal is to get industrial metals under spot, go buy used fishing lead. You can get it from most individuals (fairly readily) for 50c or less per pound. Spot is $1.25 a pound. If you really want to get nickel below spot, collect Canadian nickels (as someone else posted). US Nickels are primarily copper, with some nickel content.

The reason that copper pennies are worthwhile to collect even though they're also illegal to melt, is that they're relatively pure. If you really wanted to build a copper pile, you could with pennies. Nickels, by contrast aren't pure enough copper to work, and aren't pure enough nickel to work.

As for my commenting on a thread (not on the link) without reading the link... don't see an issue with that at all.

Nickel composition/distribution:

1.25g nickel ($11.4592/lb) = $0.031570096
3.75g copper ($4.2318/lb) = $0.0349842906

Since neither of the metals represent more than 5c in spot value, it's not worthwhile to try to extract the metal content, even if it were legal.

To hoard US nickels for metals content, the expectation would need to exist that either copper would increase 50% or nickel would increase 60% in spot value. The hoarding of nickels would have the same effect as the hoarding of Kennedy Half dollars did. It will kill the circulation piece. Nothing less, nothing more.

By contrast, copper cents have the following distribution:

2.9545g Copper ($4.2318/lb) = $0.0275617134
0.1555g Zinc / Tin (? Mixed and Tin is priced at 10x the cost of Zinc) = ?

Copper content: $0.02756

The excess content of copper creates enough room for extraction loss to make it worthwhile to refine the copper pennies (assuming it's legal) for copper content. For every ton of pennies, you would expect to extract around 1780 lbs of copper (assuming no loss to circulation wear).

 

If you took a bunch of nickels to a refiner, you'd actually lose money on them. Why? Because for one, just finding a refiner willing to separate the two metals in the coins would be hard enough. It's not a simple process. And, if you did find one, the additional effort to separate the metals will cost more, meaning you'll be lucky to get 30-40% of spot for your coins. It's not as simple as throwing a bunch of coins in a kettle and out pops a nice bar of bullion. If the value of the metal isn't at least 400-600% of the face value of the coin (in mixed metal coinage), you're wasting your time and money.
Guy

 

This was discussed before:

http://www.cointalk.com/showthread.php?t=155287&p=1099887&highlight=#post1099887

My take on this is that there are more profitable ventures involving recycled or undervalued metals. You would probably make more money at a coin show or with a metal detector at a public area. These are things that anyone with intelligence can do, and it's how many young kids make money when their peers wait for their parents' weekly allowance.

 

There's a lot of decent information in this thread, but many are missing the point. Don't collect nickels with the intention of melting them. Just like most people don't melt junk silver. Nickels are a hard asset, which can't be inflated away. In the near future, they will be collected/hoarded similar to junk silver.

You don't have to go to the bank and buy $10,000 worth, but it's a good idea to hang onto them if you have them. They also represent an extremely easy metal to get your hands on. If you've got real money to invest, buy silver and gold. If the PM market isn't an option for you, grab a few rolls of nickels. I bet you'll be glad you did relatively soon.

 

Not such a long time ago a 50 cent silver clad half was worth 75 cents when silver was $5.00. Today its over $5.00. Currently a box of nickels $100 is close to $140 in metal value. with five percent inflation over fifteen years your $100 bill would buy less then $50 dollars in goods while the box of nickels would be around $300 dollars in metal.

 

I'll take some of that money just laying around...

 

On paper, sure, but not in real life. But, if you do find someone willing to pay me $140 for $100 in nickels, be sure to let me know.
Guy