Silver back into coins

Ok this is more than likely a really stupid question, but why couldn't the US start minting its coinage with silver in them again. I understand that the price of silver is high, and that more than likely congress would have to change a few regulations like the standard price that silver is inventoried at, I think it is some stupid prise like 4.00oz. But wouldn't minting our coinage with silver in it again boost the value of our currency at all, or would it just lead to hoarding and melting of coins?

Dave

 

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Personally.... I would hoard so much GD change my house would be sinking into the ground. Every paycheck would get cashed in what ever had the best % of silver :mouth:

 

i don't think the mint will produce silver coins for general circulation. the mint make a lot of money by producing collector's silver coins. like modern commemorative and American eagle.

 

The problems this creates are too numerous to list. The biggest would be to think of how much money would have to be pulled from circulation. If quarters contain silver then there has to be enough silver to cover every dollar in existence which, of course, there isn't. To do so would cause instant, destabilizing deflation the likes of which would no doubt cause large-scale wars.

And that's just the first problem!

 

Look up "Gresham's Law"

As long as the value is "a quarter" as far as the corner store and the vending machine are concerned, people will spend the clad stuff and keep the silver.

 

Info Sponge,
You beat me to it!
I read the question and immediately went to the handy dandy Wikipedia to grab a more "formal" definition of Gresham's law than I could come up with off the top of my head. I come back to post it, and, well, you beat me.

I'll post it anyway for community knowledge....

Gresham's law states that any circulating currency consisting of both "good" and "bad" money (both forms required to be accepted at equal value under legal tender law) quickly becomes dominated by the "bad" money. This is because people spending money will hand over the "bad" coins rather than the "good" ones, keeping the "good" ones for themselves. Legal tender laws act as a form of price control. In such a case, the artificially overvalued money is preferred in exchange, because people prefer to save rather than exchange the artificially demoted one (which they actually value higher).
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As far along the fiat money path we are on, it would probably take a complete SHTF situation before we ever revert back to money that's actually worth something...and that's after the worst is over and we're rebuilding.

Or...ohhh!...how about a reverse of the 1933 gold confiscation? Soldiers could come break down our doors searching for copper nickel coins, offering the new silver ones in a face value exchange.

 

they do mint silver coins at this time gold ones too

 

Sure, they mint silver and gold coins now, but here's a case in point. When's the last time someone gave you a dollar change as a Silver Eagle? Bad money forces out good...Gresham's Law.
They put face values on them so they can be considered coins and up the premium price compared to regular bullion rounds. But when even the mint sells their dollar coins for spot plus premium, it can hardly be assumed they are for circulation as face value.

 

It won't happen, but it could. Google Hugo Salinas Price. He has been pushing for the remonitization of silver in Mexico, and has clearly spelled out how this could be accomplished despite all the naysayers' objections. People have been educated in this country in recent decades to believe that the way things are is the only way they could possibly be. That's why so many folks see things such as the reintroduction of silver coinage as all but impossible. Of course, the folks who teach that this is impossible have another agenda of their own, but that's another story for a different forum.

 

I gave you the lead to the person who has figured this out and explained it in detail. The information is available to anyone who wishes to research it and I'm not going to cut and paste long passages. It resolves all of your issues. Of course, it is simple to deny that something is possible, and I know that no amount of evidence will change your mind. The way things are is the only way they can possibly be, right? People frequently believe things are impossible when what they really mean is that THEY don't know how it could be done. I know that silver and gold will never be used as money. This isnt' the same as denying that they can be used. But I've also noticed that in some threads you say that it is impossible to have silver used as money because there is so little of it, and in other threads you claim that silver prices can't rise a lot because there is so much of it.

 

If the US is hit by hyper-inflation as feared by some the coins are fairly safe. The metals used in producing our coinage will increase in value accordingly. Of course you fiat dollars can always be converted to coins. The US five cent coin (nickel) is already a fairly safe store.

 

Yes, that's a good observation. I've also read that in some countries that experienced hyperinflation and had to knock a couple of zeros off their currency, they didn't bother to revalue and reissue the coinage because it would be too costly for the amounts involved. So coins might turn out to be preferable to paper bills as a store of value for multiple reasons even if they are made from base metals.

 

You'll need to provide a link to where he does this. It doesn't happen at any sites on the first two pages of Google hits on his name!

 

I like the idea of small, high denomination coins with "some" PM content...like $5, $10, and $20 coins. Silver coins are much cleaner (from a "germs" perspective) than paper money.

 

according to the gold commicial i just seen.they said all the silver mined in the last 200 years is gone and the mines have run out..THIS IS FROM TV COMMICIAL NOT ME...

 

http://www.goldensextant.com/Resources PDF/Libertad Essay.pdf

http://www.plata.com.mx/mplata/articulos/articlesFilt.asp?offset=20&fiidarticulo=73

http://www.plata.com.mx/mplata/articulos/articlesFilt.asp?offset=30&fiidarticulo=49

http://www.plata.com.mx/mplata/articulos/articlesFilt.asp?fiidarticulo=97

Try this.

 

I posted some (what I thought were) interesting PM supply/demand charts I found on KITCO.com on this thread...

http://www.cointalk.com/t73119/

It doesn't look like silver mining is slowing down any based on those charts. But...Hey!...they can't say it in TV if it isn't true...right?