Inflation will finish off the U.S. paper dollar.

In the end, inflation will be the force that finally knocks off the U.S. paper dollar and opens the way for the dollar coin.

When the day arrives when it costs $2.25 (or whatever large amount) to purchase a candy bar from a vending machine, THEN the public will find dollar coins more convenient and useful than a wad of paper bills.

Years ago, would you have used 2 or more paper bills, or two dimes, to purchase a soda pop?

Think about it! The day will arrive!

 

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dunno, as a nation we still love our gas guzzling muscle machines and fuel sucking SUVs despite all the information stacking up showing it would be best to do away with our dependence on gasoline. Its the same with the paper dollar, they are entrenched. Numbers and logic won't change things. Personally, I still find it easier to have 10 $1 bills in my pocket than being weighed down by 10 Sacies, clinking loudly as I walk down the streets of NYC, removing all doubt as to whether I have $$$ in my pocket or not. But that's me.

 

This is just a thought. They could make it out of a light weight metal. I have some france coins from the 40s or 50s that weigh barely anything.

 

But keep in mind, just like the old days when a few dimes or a couple of quarters handled your small amount transactions, and the dollar was able to purchase more than a candy bar, so would it be today; the dollar coins, just a couple of them in your pocket for the small amount purchases would be sufficient, and the 5 and 10 dollar bills handle the larger amount purchases. Really nothing has changed except the value amount inscribed on the coins....... thanks to inflation.

 

Many countries besides France have used aluminum for coins. Probably the most prolific is the Japanese yen, with many billions struck over the past 51 years.

Unfortunately, particularly from a numismatic standpoint, soft aluminum coins wear very quickly and look pretty ugly in short order.

 

The U.S tried using aluminum for cents in the 70's. It didn't work out well, and they were melted down. We could just use the same metals, and as fj said, change the denominations. Personally, I think that when paper money becomes obsolete, the coin will also be doomed. In the future, we'll have something more sophisticated than coins and paper, which can be counterfeited.

My 2 cents......

 

I couldn't agree more.

This is what I don't understand: Why doesn't the government call for a $5 coin or a $10 coin or a $20 coin? Why does it always have to be $1? Wouldn't a $20 coin make more sense? You could carry fewer, purchase more, and so on. Pay for something that costs $2 or $3 with a $20 coin? Getting back 5 or 6 coins max in change (or even paper $1 or $2 bills) is a lot better than having to haul around 17 Sacs plus quarters, dimes, and so on. It just seems so easy to me, but maybe I'm missing something?

 

Pocket change DOES have a way of sometimes getting lost; would really hate to lose a $20 coin or two!!

 

Nice in theory, but ignores reality. There are many countries in the world that use ONLY paper money. I was in Slovenia, and I had to ask many people to get even one or two coins as souvenirs. They just don't use them. They use paper money for everything.

The US had already had large coins (uncluding $20 coins) and people prefer paper. The impact of inflation has already been major, but people still use a paper dollar. In the most extreme cases, inflation drives ALL coins out of circulation - only paper money remains.

 

Some younger members of the forum might live to see the day when there is no more US coinage. At 4% inflation, money loses about 85% of its purchasing power over 50 years. What are you going to get for one-seventh of a cent? What metal would they make it out of that is worth less than one-seventh of a cent so they don't have to produce it at a loss? So it appears to be only a matter of time before at least some coins disappear from production forever.

 

I like to carry my money in my wallet. I keep too much stuff in my front pockets to have much room for change. Any change I have gets put in a jar at home where I can peruse it at leisure. At any rate with McDonalds and Burger King beginning to take credit cards, and gasoline stations doing one better by merely requiring proximity devices it shouldn't be long before drink and candy machines are internet connected and can debit your account directly.

 

What ever the reason, be it inflation or what ever, it would also apply to coins. The chances are that plastic will be the first major change in how we use and spend money. Followed closely with a small chip placed under the skin that can be read by electronic means and money transfered from a persons account to some where else. The days of "big brother" are coming!

I was surprised to find this type of thread in this part of the forum. Guess Roy must think this is coin related.

 

In a way it is about coins...its about no making coins or paper money later down the road....

Speedy

 

Exactly, it is ALL about U.S coinage and paper money and the possibility of new or discontinued denominations for both.

 

What's the exchange rate now? 1,000,000,000 yen for $10.00

Ruben

 

Maybe so but I would perfer not to pull out my wallet just to get coffee and a newpaper before hopping on the subway in the morning.

Ruben

 

Plastic all the way! I went to the car wash the other day and had to wait in line as it had snowed a day or two before and everyone wanted to get the muck and grime off. So I'm sitting there next in line thinking my stategy. Where is the coin change machine and should I go change my bills now or wait till I pull my car. The the change machine is on the other side of the building. Well I deside to wait and pull into the bay and WHALA!!! they installed a creditcard reader in the car wash next to the coin slot. No more digging for quarters or crisp dollar bills. I think I'll go charge a burger at McDonalds on the way home from the car wash.

 

The only thing I think that will finish off the paper dollar is if they stop printing it. And that aint going to happen anytime soon.

 

A lot of the confusion about this topic is cleared up once you understand the difference between a dollar and a dollar bill. Then the whole concept of coinage makes a lot more sense.

 

That is for sure...I saw OldDan posted an article about that the other day but now I can't find it....

Speedy