If the Mint stopped making Lincoln cents...........

...........would we have fewer PMD threads?

Chris

 

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The Lincoln cent market would rise as people begin to hoard and collect again.

 

Smarter move would to revalue all cents to 5 cents, make a new copper plated 5 cent piece and discontinue the current nickel. Solve both problems with one fell swoop, and people would be happy since every penny now is worth 5 times as much.

I know your post was tongue in cheek Chris, but you also know darn well as long as there are coins people will mess with them, and then others will come on Cointalk asking about their "rarity".

 

you are right about folks messing with coins other than cents. I know a ebay seller that is trying to sell three messed up half dollar coins as errors.

 

Copper-plated what, though? I thought both zinc and nickel prices had risen past the point of Mint profitability.

 

Ah but that's only because each cent costs about 2.5 to make. If they revalued it to be five cents then it would be well within profitability.

 

There was a notice somewhere about making copper coated zinc nickels, same size as current nickel.

 

No. Most beginners in collecting start with the cent.

 

And if we didn't have the cent then most beginning collectors would start with the nickel.

 

Then everything I collect would be obsolete ......

 

Huh? What? Who doesn't love a good PMD thread???

 

Do you think they could afford it?

Chris

 

Twenty times a day?

Chris

 

Actually if they stop making them it just might increase their collection. The result, more collectors, more threads. Be careful what you wish for.

 

Perhaps copper-plating some 19mm-diameter wooden biscuits that carpenters use? Hey, then we'd have 5 cents that could float! Is that right?

Seriously, though: Copper-coated aluminum, or straight-up aluminum. If cost-savings per unit is the goal, I would imagine that might be the only way, other than some sort of plastic(?)

 

Well considering the purchasing power, when I started collecting the cent had the same purchasing power that a dime has today. That means that someone starting today with nickels is paying only half what I was paying starting with cents back then.

 

Even if the Mint used aluminum/steel, it would still cost more than 1-cent per cent, since the labor and marketing related costs account for 1.3-cents or something like that in the current cost-per-cent formula. Seigniorage will forever be the only way production of the cent can be justified from a budgetary argument. It's a good argument, so long as it costs less than 4x the coin's face value to make said coin.

 

If the US stopped making cents then the per unit cost of producing all other coinage would increase.

 

That's the problem. There is no seigniorage on the cent or five cent, or rather they have a negative seigniorage. In the past they could use the positive seigniorage from the other coins to offset the negative seigniorage of the cent and five cent, but I'm afraid that the mint report for 2013 due out next month will show that last year the profit from the other coins will not be able to offset the losses from the one and five cent and the mint will show a loss on circulation production for the first time in probably a century. This can be a problem because the mint normally does NOT receive any tax money for its operation. It self funded from the seigniorage profits and sent profit TO the Treasury instead. Now the Mint may become a drain on the treasury instead which increases the debt and the need for more borrowing or taxes.

Three years ago the mint sent over 300 million dollars to the Treasury General fund. Two years ago it dropped to 71 million. Last year it was either 16 or 23 million I don't remember which. And the only reason there was any profit at all was because the 2012 fiscal year included the last quarter of the 2011 calendar year and the last three months of small dollar production. If it wasn't for the 70 some million in seigniorage on those, the Mint would have been some $40 million in the red.