melt value of pennies and nickels higher than purchase power - New England Patriots Forums

otis p. driftwood · 05-08-2008, 01:57 PM

Just got this from one of the many borderline junk emails I get during the day relating to money/investing etc.
I make no promises to it's truth, but it sounds right.
I like pennies, but they serve no useful purpose any longer. Maybe there's something to the idea of making them from pressed garbage though. How about making new pennies and nickels from recycled plastic bottles?

Quote:

How odd is this? The melt value of pennies and nickels exceeds their purchasing power.

“If we continue minting coins with the current metal content,” Rep. Luis Gutierrez, D-Ill., said this week, “with each new penny and nickel we issue, we will also be contributing to our national debt by almost as much as the coin is worth.” Gutierrez, who oversees the U.S. Mint in Congress, says minting these coins above their material value cost the U.S. Mint an extra $100 million last year.

In late 2007, the U.S. government paid 1.67 cents for every new penny and nearly 10 cents to mint a new nickel. Despite a correction in the global price for copper, zinc and nickel, the U.S. government is still paying more to produce pennies and nickels than their “worth.”

Today, a penny costs 1.26 cents, and a nickel 7.7 cents.

Could it be the U.S. will start doing what all empires in history have done at one time or another… and clip their coins?

Sure enough… Congress is debating a bill this morning that would direct the Treasury to suggest to the U.S. Mint a more economical way to mint the coins. Namely, to start adding steel to the mix. The last time we had to do something this drastic was during World War II, when we were melting down bombshell casings left over from operations in the South Pacific and Europe.

Oh, brother. We wonder… what will happen when a steel penny costs more than one cent? Maybe we could mint them out of glued-up sawdust… or tightly pressed garbage. Or maybe start shaving edges off the sides… make mini pennies. The economists of ancient Rome must be spinning in their dusty tombs.

Real World · 05-08-2008, 03:32 PM

Metals and stones have never been worth more than they are now. The bounce upward of many large economy's across the globe have really driven the demand side of consumption. It's why most economists only attribute a $10-15 War cost to a $120 barrell of oil. Concrete, which I use a lot of, has been rising dramitcally for 5-10 years now. In 1997 I paid $52 a cubic yard. In 2000 it was $74. Today it's $120. My office is over near the produce center on the Everett/Chelsea line. There are a number of scrap metal yards here, and they're busier than ever, cuz the $$ for metals has skyrocketed.

For example:

Quote:

Hot Metal

Thefts Increase as Prices Rise for Copper and Other Materials

By Jeremy Maready
THE LEDGER
LAKELAND

If you thought the commodity markets were just for Wall Street financiers, think again. Crooks are watching the markets, too, and making more than a pretty penny in Polk County. The prices of scrap metals are at an all-time high and so are thefts, especially for copper wire. Copper is fetching close to $4 a pound, according to Kitco Base Metals, a precious metal retailer, up from about $2.75 in December.

Aluminum is raking in $1.30 a pound compared to less than $1.10 in December.

The price increases on metal commodities are being fueled by growing demand from foreign countries - namely China and India - that find themselves in an economic boom and facing a worldwide shortage of the materials.

http://www.theledger.com/article/200...55/0/FRONTPAGE

***DarrylS*** · 05-08-2008, 04:00 PM

Take it one step further, the Mint has been trying to do away with dollar bills.. they introduced the sacagawea dollar and now the presidential dollar.. and it has not taken off.. we are one of the few countries that continue to use a dollar bill or small denomination bill.. the coins are cheaper in the long run and last longer..

fleabassist1 · 05-08-2008, 04:21 PM

I read somewhere that they could put a tracking device inside every dollar for about the cost of a penny - that way you can make cash a trackable money which would also prevent counterfitting. It would also eliminate the penny :O

Real World · 05-08-2008, 05:02 PM

Quote:

Originally Posted by GJAJ15

Take it one step further, the Mint has been trying to do away with dollar bills.. they introduced the sacagawea dollar and now the presidential dollar.. and it has not taken off.. we are one of the few countries that continue to use a dollar bill or small denomination bill.. the coins are cheaper in the long run and last longer..

They suck hardcore. In Italy the Euro starts with a $5 bill. Everything lower is a coin. They've got a $2 Euro, and a $1. They blow bigtime. You end up with 7 pounds of coins in your pocket. It really, really sucks. I totally see you're point about lasting longer though.

scout · 05-08-2008, 06:19 PM

The Penney is a freakin' joke. There are still people (with influence) who will tell you that the Penney is still economical to mint. Even when the price of metal equaled the value of the Penney, it still is not a break-even proposition. Soon, if not already, the Penney will be equivalent to the ice buckets which were placed at the door of a congressman's office (This was finally done away with long, long, long after the invention of the refrigerator).

***DarrylS*** · 05-09-2008, 04:31 AM

Quote:

Originally Posted by Real World

They suck hardcore. In Italy the Euro starts with a $5 bill. Everything lower is a coin. They've got a $2 Euro, and a $1. They blow bigtime. You end up with 7 pounds of coins in your pocket. It really, really sucks. I totally see you're point about lasting longer though.

When I travel in Mexico, never had a problem.. the only one being is that there is not enough differentiation of the coins, so it is difficult to tell the difference between the various denominations of pesos.. time to take out the glasses..

Canada does something similar, my friends there talk about the loonie and toonie...