On the front page of Yahoo - article from Kiplinger's Magazine...talking about getting rid of the cent. Title says Penny, not my term! Link: http://finance.yahoo.com/banking-bu...-comes-to-the-penny-washington-makes-no-sense Not really a great article and doesn't give ANY alternate ideas. Rounding up to the nearest nickel seems like the cheapest and easiest way, but I would hate to see old Abe go. I love getting those new shiny shield cents in my change these days. My biggest problem with the article is that it says it costs 1.6 cents to make one cent...but they aren't single use items...their production could be amortized across the decades the cents could be used. Sure it's monetary value is only 1 cent, but it doesn't cost a full dollar to print a dollar bill...unless you screw them up and have to shred millions of them!
"Each one of those tiny tributes to Abraham Lincoln costs 1.62 cents to manufacture. In other words, if you had the proper equipment to melt pennies, the raw materials would bring a 62% return on your investment, minus costs — and ignoring the pesky little fact that melting legal tender is illegal." Wow, that's completely wrong. Manufacturing costs are 1.62 cents, that doesn't mean there is 1.62 cents worth of metal in modern cents. How could this article even be published?
Saw that myself, but that,s the U.S. Government for you always doing stupid stuff like this No wonder the country is broke! (Poor decision making)
I still don't understand why the mint has to produce one cent pieces every year (probably due to the laws regarding it). But they should change it and only produce them once every three or so years. There are PLENTY out there and I don't think a shortage would ever happen if they did that.
You know how many people throw pennies away when they move? Manage apartments and you'll find out. I've cashed in tons of pennies over the years that others didn't want. Lots of coins sit idle for years until cashed in, further depleating the supply. In the 1960's people blamed vending machines and collectors for the shortage of silver coins (which were expensive to produce) http://numismaster.com/ta/numis/Article.jsp?ad=article&ArticleId=9082
to concur with this i also think the UK government should demonetize the 1p and 2p coins much the same way as australia and new zealand did with the 1 and 2 cent coins a while ago.
If they get rid of the cent I can tell you they won't be rounding to the nearest 5 cents, as a nickel costs 9 cents to mint. I imagine it would go as well. Of course, it costs 12 cents to mint a quarter, so what they lost on the cent and nickels they more than make up on with quarters. Most businesses don't make money on every product they sale, just the overall volume of combined products. Thats why we can go to Costco and buy a new book for less than half the retail price. It's basic business. Guy
