Posted on 01/24/2007 2:47:39 PM PST by presidio9
Talk about pennies from heaven.
A potential shortage of coins in the United States could mean all those pennies in your piggy bank could be worth five times their current value soon, says an economist at the Federal Reserve Bank of Chicago.
Sharply rising prices of metals such as copper and nickel have meant the face value of pennies and nickels are worth less than the material that they are made of, increasing the risk that speculators could melt the coins and sell them for a profit.
Such a risk spurred the U.S. Mint last month to issue regulations limiting melting and exporting of the coins.
But Francois Velde, senior economist at the Chicago Fed, argued in a recent research note that prohibitions by the Mint would unlikely deter serious speculators who already have piled up the coinage.
The best solution, Velde said, would be to "rebase" the penny by making it worth five cents rather than one cent. Doing so would increase the amount of five-cent coins in circulation and do away with the almost worthless one cent coin.
"History shows that when coins are worth melting, they disappear," Velde wrote.
"Rebasing the penny would ... debase the five-cent piece and put it safely away from its melting point," he added.
Raw material prices in general have skyrocketed in the last five years, sending copper prices to record highs of $4.16 a pound in May. Copper pennies number 154 to a pound. Prices have since come down from that peak but could still trek higher, Velde said.
Since 1982, the Mint began making copper-coated zinc pennies to prevent metals speculators from taking advantage of lofty base metal prices. Though the penny is losing its importance -- it is worth only four seconds of the average American's work time, assuming a 40-hour workweek -- the Mint is making more and more pennies.
Velde said that since 1982 the Mint has produced 910 pennies for every American. Last year there were 8.23 billion pennies in circulation, according to the Mint.
"These factors suggest that, sooner or later, the penny will join the farthing (one-quarter of a penny) and the hapenny (one-half of a penny) in coin museums," he said.
I hate bringing in pennys. The bank clerks look at you like you just plopped a steaming pile of do do on their desk.
Are all pennies pure copper?
I like paying annoying institutions and government agencies in pennies - for the exact same reason.
Not since 1982, no.
They're mostly zinc.
That's what I thought, thx.
I've often wondered why people don't just round up or down to the nearest 5 cents and stop using pennies anyway.
Here in NYC, I have had homeless guys say "no thanks" to pennies.
I've got three gallons of pennies -- they're just not worth carrying around.
What is zinc going for these days?
I know nickel metal is worth much more than copper -- what is the composition of a nickel?
I think they should just stop making pennies and nickels, and start producing $1, $2, and maybe $5 coins, with MALE PRESEDENTS or cute GREEK GODESSES on them.
>>Are all pennies pure copper?<<
I believe 1982 and prior. It's not worth sorting them though, unless you're unemployed.
Speaking of NYC, that's exactly what most businesses do here.
Yippee! I've got half a large wine bottle full of pennies. lol
Why dont they make pennies = dimes, dimes = quarters, quarters = dollars and dollars = ten dollars, tens = hundreds and so forth. Then we can all be thousandaires and drink bubble up and eat rainbow stew.
I recall learning in school that debaseing ones currency is a bad thing.
It is completely unacceptable to me that there is no US currency with Ronald Reagan on it. A $1 Reagan coin is a natural. People would start referring to them as "gippers" almost immediately.
Talk about slow jouranlism. Copper peaked more than a year ago and has been falling since.
Or have several grand children :-)
udder non cents
I think it's past the point where they should. I don't even use pennies anymore --- if I get one in change I just throw it away, or it gets lost behind the car-seat or buried in the couch.
--I've often wondered why people don't just round up or down to the nearest 5 cents and stop using pennies anyway.--
We have groups that complain about about the gas stations rounding off to the nearest cent on their pumps.
I've often wondered why people don't just round up or down to the nearest 5 cents and stop using pennies anyway.
I been doing that for years.
zero, nata, none, pennies in my pocket, leave or short at counter.
The pennies help the clothing industry by causing holes in pockets! LOL!
I have something in the range of 500 or 600 pennies, all going back to the late fifties, sixties and seventies. Just loose change that ended up in a ceramic Denver Bronco helmet shaped piggy bank. If they're worth 5 cents each now maybe it's time to cash in ... ;)
Call me crazy, but I just love pennies! I've got millions of them, and I once gave my brother a 5 gallon jug full for a Christmas present. He was about ten, and really worked to get the cash value (he lived with me and it was school vacation!).
I do agree with the poster who said that debasing the currency is a dangerous thing. American money is as good as it gets, so if it ain't broke, don't fix it.
Also, I don't care for the new Monopoly money, it makes me nervous. I like good old greenbacks.
It is past time to dump the penny. The last time the US got rid of a low value coin was the half-cent in 1857. A half-cent back then would be worth about a dime now. Dumping it then would be like getting rid of the penny, nickel and dime now and saying everything must be in quarters. I think that would be extreme, but I would like to get rid of the penny.
Some thirty years ago while visiting Italy I remember my first encounter with truly debased coinage. A magnet stuck to some of their coins, zinc cores were in the rest.
Debasing the currency is a ploy as old as government.
HA....my husband is planning on going to our branch of Bank of America and plopping down his piggy bank (it counts the change as he puts it in) and saying.....see...it says I have $50.49.....please give me bills for that.....and when they say they can't....he'll say....Bank of America makes about $3 BILLION a QUARTER in profit, and I've banked with you for 12 years....and you CAN'T do that? You WILL DO THAT!
Nickel is the most expensive base metal in the world as I write this.
A simple solution would be to repeal all the sales taxes and require merchants to price to the nearest nickel.
No. Copper plated zinc.
All the banks/credit unions I've dealt with just poured the coins into their change-counting machine and handed me the bills with no questions asked. Are there really banks that give people a hard time about cashing their coins in?
lets just put reaan on all or coins
*Reagan
Whatever happened to that Sacajewa (sp?) dollar? I thought they were cool, but were hard to find. Then there's the infamous SBA dollar, AKA the "Dyke Dollar"....
The pennies, nickles and dimes aren't worth the time to roll yourself.
The article is about REbasing the penny, Emily, not DEbasing. REbasing.
I COULD BE RICH!!! ;)
There will be a Reagan $1 coin once the series of Presidential $1 coins gets around to him, but it will take a while.
Sounds almost as bad as U.S. Bank.
It is past time to dump the penny. The last time the US got rid of a low value coin was the half-cent in 1857. A half-cent back then would be worth about a dime now. Dumping it then would be like getting rid of the penny, nickel and dime now and saying everything must be in quarters. I think that would be extreme, but I would like to get rid of the penny
xxxxxxxx
i'll buy them?
"I've often wondered why people don't just round up or down to the nearest 5 cents and stop using pennies anyway."
The states would love it, they would automaticly round up and screw us royally on sales taxes!
I don't know why people say pennies aren't worth the time it takes to wrap them. If I am sitting on my butt at home, I am not getting paid by anyone. If I wrap $5 in pennies rather than thowing them away, I've got $5. Would I throw away a $5 bill every few weeks? Hell no.
Here's a penny webpage: http://www.kokogiak.com/megapenny/
A penny will still buy a kid a ride on a mechanical pony at Michigan Meijer stores.
ping
No offense to Reagan, but money should strictly be for the Founders only.
I think they meant to say that Cu is 3x higher than it was 5 yrs ago.
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