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<p>[QUOTE=&quot;GDJMSP, post: 428645, member: 112&quot;]Cloud - you misunderstand. Yes they said that there were to be 371.25 grains of silver in a dollar - a minted dollar. But that does not mean that 371.25 grains of silver cost a dollar. At that time, 371.25 grains of silver cost leass than $1.</p><p><br /></p><p>There have been times throughout our nations history that the value of silver dropped to such a point for a short while that the amount of silver in a dollar was actually worth less than $1. But for the vast majority of time that was not the case. Had it been, no nation on earth would have been able to afford to mint their own coins. In the $10 gold coins for example - there was not $10 worth of gold.</p><p><br /></p><p>And that&#039;s what seniorage is. It is the profit that a mint makes by minting the coins. You are right, seniorage has nothing to do with the intrinsic value of a coin. For example, if silver cost a $1 an ounce, they would put 3/4 of an ounce of silver in a $1 coin. If gold was $22 an ounce, they would put .97 ounces of gold in a $20 gold coin. That&#039;s seniorage.[/QUOTE]</p><p><br /></p>

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