The debate in Congress continues

I don't know which is true - but I would tend to believe this. For the government not to have some gold squirreled away somewhere just seems irresponsible.

 

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Government. . . .irresponsible.

Sounds like a good argument for the gold being gone.

 

Sorry I misunderstood what you meant when you said the gold was gone many years before the silver was used up, because the mint has never really had "reserves". They always got their gold and silver from the treasury stockpiles back in the years (post 1873) when gold and silver was coined for circulation. Then when they started striking the gold and silver commems and bullion coins again the silver came from the government stockpiles (until it was depleted), but the gold came from new purchases.

 

Yes there are massive overhead costs that won't go away if they stop the cent but how do you think we got those costs? We've been churning out 10 or 15 billion cents each year and when we have to build a die shop it is charged against all the denominations. The cents took up much of the production capability until the states quarters came around but these are made at a massive profit.

It would increase the cost of making the other coins somewhat to simply eliminate the cent but it would be many years until more capital projects are needed to increase capacity.

Most of the cost of the cent isn't really visible. It's not the .26c we lose on each one that represents a massive loss. It's the cost of counting, handling, and transporting these worthless little things that is the real money eater. It's the loss of interest and capital from having 200 billion of them lying around doing nothing. You can't claim they are circulating when 25 year old cents are still unc or unc except for the rot.

The nickel need to be made more cheaply and the cent needs to go. The pennies should be recalled and melted to remove their toxicity from the enviroment.

 

Originally Posted by Cloudsweeper99

"This should be a non-issue. When was it decided that money should have no value, or at least have less intrinsic value than the face value? I missed that vote."

Well, at the risk of picking a nit silver had less value relative to face in 1935 than clad did at the start of 2008.

In 1935 a gem unc '32-D quarter was worth about 6c on the world market but in 2008 a 1983-P gem quarter is still worth a couple hundred dollars.

It's a crazy world ain't it?

 

Of course they lose money. Money is how we keep score and if material and labor exceeds the value of the product then real wealth, real value has simply evaporated. They took fuel that could have been used for useful purposes and mined the zinc. They used equipment that could have made important products to roll and plate the zinc and then they wasted the mint's capacity to make the coins.

Yes, we do need the nickel to operate the economy but we don't have to have a nickel that is made at a loss. Even if it weren't important to save the money the simple fact is that with a coin worth more as metal than as currency we are walking on egg shells; what happens when people start hoarding them? How does a store make change without a nickel?

 

Simple solution;

Drop the damn penny since no study is needed.

Make the nickel out of aluminum and the only cost to modify the vending machines is to put a plastic sticker on them that says "NO NICKELS". The machines are already capable of dispensing nickels in change regardless of their composition and will reject aluminium. The cost per machine is less than a dime.

We don't need no stinkin' studies. We need action.

 

Here's an idea, re-value the paper currency. Think in terms of a new $1 Hamiltons, $2 Jacksons, $5 Grants, and a $10 Franklins. I remember when you could get a coke out of a vending machine for a nickle or a dime. Inflation has made coins more and more expensive to produce and we've gone from 90% silver to 40% silver to zinc clad to what steel clad next. I can see the 2050 plastic clad nickle. It's a paper problem, not a penny problem. MHO

 

True... but, as pointed out earlier, they lose ONLY on the 1c and 5c. Overall, they operate at a HUGE profit.

In truth, the annual profit on 25c alone is almost $500 million -25 times the much ballyhooed 1c loss, and ten times the loss on 1c and 5c combined.

Isn't that relevant ? Of course it is; in fact, it's a dominant issue.

Why, then, does no one ever mention it ? Because no one knows, because it is completely hidden by the media.

Much ado about nothing. The only thing this issue reveals is how we are poorly equipped with adequate facts to make intelligent decisions.

Which says little about pennies or people, and much about the media.