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Rising zinc price to doom the penny?
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<p>[QUOTE="calcol, post: 2485091, member: 77639"]Well, $10K face value of pennies is 2.5 metric tons = 2.75 US tons =5,500 lbs of zinc. Breakeven is $1.82/lb. Let's say the price rises about 10% above breakeven to $2/lb. Gross value would be $11K for a "profit" of $1K. If price gets to $2.2/lb, gross value would be $12.1K for a "profit" of $2.1K. There would be costs like haulage and energy for melting. These things are difficult to assess because energy used to melt zinc can be from a source being used for something else, like a kiln. And the energy can be recaptured for a another purpose, like space heating, water heating, cooking, etc.</p><p><br /></p><p>Where would the pennies come from? Mostly from small businesses that have commercial bank accounts. Instead of ordering ten rolls per day, up it to a few hundred or more. Local bank branches won't care; they'll just order more from the Fed. Folks who are into roll searching seem to get their hands on lots of coins.</p><p><br /></p><p>Cal[/QUOTE]</p><p><br /></p>
[QUOTE="calcol, post: 2485091, member: 77639"]Well, $10K face value of pennies is 2.5 metric tons = 2.75 US tons =5,500 lbs of zinc. Breakeven is $1.82/lb. Let's say the price rises about 10% above breakeven to $2/lb. Gross value would be $11K for a "profit" of $1K. If price gets to $2.2/lb, gross value would be $12.1K for a "profit" of $2.1K. There would be costs like haulage and energy for melting. These things are difficult to assess because energy used to melt zinc can be from a source being used for something else, like a kiln. And the energy can be recaptured for a another purpose, like space heating, water heating, cooking, etc. Where would the pennies come from? Mostly from small businesses that have commercial bank accounts. Instead of ordering ten rolls per day, up it to a few hundred or more. Local bank branches won't care; they'll just order more from the Fed. Folks who are into roll searching seem to get their hands on lots of coins. Cal[/QUOTE]
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