I did a search here and couldn't find any reports of anyone getting in trouble for breaking the law against melting coins that came about in 2006: http://www.dailyreckoning.com.au/mint-nickels/2006/12/23/ This could be another example of new laws that aren't being enforced much if at all, like the Patriot Act laws that were designed to thwart money laundering and that coin dealers were supposed to have a compliance plan for. Another thread where a fellow announced plans to hoard and melt nickels: http://www.quatloos.com/Q-Forum/viewtopic.php?t=6896 Thanks for the feedback.
is it true that it's difficult & expensive to seperate this copper/nickel alloy ??? maybe that is the reason why ???
Running a smelter costs money in both overhead and labor. In order to show a profit from melting either nickels or cents, you have to melt a LOT of them. Think Dump truck loads. Couple that with the fact that you could go to jail AND get substantial fines and most folks will simply collect their hoards until they get tired of either storing them or hauling them around. Then its off to the bank.
They don't need to be separated and it's far too expensive to do it. They will be used for alloy in making products that require both copper and nickel such as stainless steel. There are no transportion or melting costs either since something has to be used and it may as well be nickels. But people don't have an electric furnace in their backyards cranking out stainless by the ton so there's no need to police or prosecute sine no one's going to do it. Pennies are another matter and there are small scale melters. If they get caught then they're up the creek but the government is unlikely to worry about someone making a 80 pound bronze sculpture unless they want to make a case for show; make an example of someone. No one cares about the zinc and they're cheaper than washers.
Thanks for the responses to this question. I saw someone arrested for melting pennies, which have a much larger profit margin. Problem will always be that if the IRS ever audits you they may call up their buddies at the Secret Service who are authorized to enforce currency violations. Plus the EPA or state DEP may get involved if they are looking for an easy target--I'm sure the melting/smelting causes environmental issues.
Eventually the law will change. The government will find a way to make money off old coins. They will allow a few limited companies with authorized permits to take in old coins for metal reclamation. There a few authorized companies that make blanks for current coins and one company authorized to manufacture the linen paper used in modern currency.
I still think it will be like it was back in the late 60's.. Back then the Fed had a couple machines that separated the silver from the clad coin. The clad was sent back to the banks and the silver was kept. Then when the amount of silver recovered by the machines dropped low enough that it was no longer worthwhile to try and recover it they stopped and the law against melting down the silver coins was repealed. It would not surprise me to find that they are cuirrently separating out the copper and zinc cents and when the percentage of copper cents in circulation drops low enough they will change the law forbidding their melting. The current laws against melting the cents and nickels are not there to keep people from making a profit, they are there to protect the circulating coinage and to ensure there is no shortage. Once all the cents are zinc and pulling out the few remaining suddenly wouldn't cause a problem we will probably see the law change. Some 20 to 30% of the cents are still copper and if they were suddenly pulled there would be a cent shortage.
I'm not questioning your credibility, but that seems pretty far out there. Extraordinary claims require extraordinary proof. Do you have any citations to back up the story of separation occurring in the 60's? From the amount of silver that still turns up, I'd say Greshams law was all that was at work.
The government issued massive quantities of 1964 dated dimes and quarters until 1967. The point was to make them common enough that Gresham's Law didn't become operative. In 1968, the clad coins in circulation were sufficient to tolerate the selective withdrawal of silver coins, so the government only minted clad coins (and 40% silver halves) from then on. Silver coins gradually disappeared from circulation thereafter, but still appear from time to time as old hoards are discovered or inherited by people who don't know the difference.
I'm posting some info on Canadian nickels ,their weight and nickel content,also I don't believe if you are American you can be arrested for melting foreign coins. At this moment nickel is at 12.72$\lb. Canadian nickels weigh 4.54 gms so 100 make a lb. 454gms= 1lb. [SIZE=-1][FONT=Arial, Helvetica][SIZE=-2]Coins from 1953-1964 (Laureate Bust) weigh 4.54 grams, with a diameter of 21.3 mm (opposite corners) 20.9 mm (opposite sides) and a thickness of 1.7 mm. They have a composition of (1953-54) steel with .0127 mm nickel plating and .0003 mm chromium plating (1955-1964).99 nickel. Coins from 1965-1978 (Tiara Obverse) weigh 4.54 grams, with a diameter of 21.21 mm and a thickness of 1.7 mm. They have a composition of .99 nickel. Coins from 1979-date weigh 4.54 grams, with a diameter of 21.21 mm. They have a composition of (1979-1981) .99 nickel (1982-date).75 copper, .25 nickel. The purity is awesome so separating the copper wouldn't be an issue. [/SIZE][/SIZE][/FONT]
Can you get one of those machines that seperates silver from clad? Sure would make it easier to do CRHing
It should be considered that home smeltering of copper-nickel products can produce severe neurological damage, respiratory system cancer, and of course death from toxic exposure. If you do not have commercial smelter safeguards, the riskd far outweigh the profits, IMO. Jim
There seems to be some kind of idea that if they didn't have the no melting law people would be melting them down in their backyard furnaces. There are plenty of business that deal in scrap metal that buy from the public and then ship it off to the commercial smelters by the semi-truck load. That's where the cent and nickel hoards would go and they would then handle the shipping and the commercial smelter would handle the melting. The recycler would buy them because he is gathering enough to make the shipping worth while and the smelter would be getting enough in to make the melting of multi ton lots economical. After all, if you melted it down yourself what are you going to do with it? Sell it to the scrap dealer of course. So why melt it twice when he will buy it in its original form.
The Treasury rule will be repealed someday after the percentage of these coin in circulation are minimal. Of course, this will require a new alloy nickel to be produced. The rule is just there to scare smelters away from handling these, to facilitate commerce. The question is, how long does someone want to hold onto these, having to keep them secure from theft and earning no interest on this money, in order to cash in on them in the future. If someone put away BU nickels each year I would not argue, but I have better things to do with hundreds or thousands of dollars than to put them in bags of nickels earning no interest. The thought that these will be worth more than face value in the future is right, but at what cost? Even silver coinage you would have been better off putting in a mutual fund in 1964 than keeping silver change. You cannot ignore the time value of money, and if you don't like the USD, then invest it in something with exposure to Yuan, Euros, Baht, whatever. Just my thoughts.
