Posted on 02/06/2011 4:25:44 PM PST by blam
Not illegal in China either (to melt down US nickels).
Just wait, they’ll demand that our trilion+ debt to them will be in nickles!
Yikes...
I’m doing this myself.
The Phelps-Dodge story is rather interesting. They effectively committed suicide. They “sold themselves short”!
Here’s how it happened:
Virtually *all* miners (and farmers, for that matter) have to “sell-forward” some part of their production. Why? Because they have a payroll to meet this week, this month, and they do so by selling their output. Fine. But in times of declining ore & metals prices, (eg; most of the 90’s) on market price spikes they agree to sell some part of their production at those spikey-high prices to others, typically users of the metal who see the same price spike(s) and fear a price ramp. Thus, they (the users) wish to lock in today’s “mildly spiked” price instead of waiting and having to suffer tomorrow’s “badly-spiked” price. It is not one whit different than the homeowner who sees soup on sale and buys a dozen cans to lock in today’s price.
Fast forward. After a decade of frustratingly low prices, P-D had sold SO MUCH copper forward that they now had a serious problem. And that was, underneath their “sell-forward” contracts they had committed to, the market price of Copper had soared. And so now, they were committed to supply kilotons of copper at a BELOW market price! Those commitments, from an accounting standpoint were big bazooka holes in their balance sheet because they were now locked-in losses instead of locked in gains. ANd so they devalued the company, allowing another co to come in. But how could another company come in advantageously? Aha. If that other company itself was a copper miner and could mine the copper needed to fulfill those contracts (which of course persisted over the sale of the company) at below-market prices, the buyer would suffer a slight loss, yes, but could acquire PD at effectively a discount. This is precisely what happened. I believe FCX and PD had been or were in merger talks several times over many years but it just didn’t happen for reasons I don’t know. The big hole that PDs’ sell-forward contracts created gave FCX the club it need to force the issue, and they did.
If you do the math on how many rolls of pennies you’d have to sort through to pay for one of the machines, you better start adding in the cost of railroad spur to the side of your house!
“Im doing this myself.”
Me too more on why here...
http://www.economicpolicyjournal.com/2011/02/why-you-need-to-own-americas-last.html
If you do the math on how many rolls of pennies youd have to sort through to pay for one of the machines, you better start adding in the cost of railroad spur to the side of your house!
But it’s a hobby, like those who use metal detectors to find stuff.
My greater concern is what I’d do with the pile of newer pennies, since I’m not sure who will happily accept an unrolled bulk pile.
The bank will take the rolled pennies back as long as you don’t try to unload a pallet load at a time. But there is effort involved in re-rolling them, of course. The bank will also give you a dozen or 20 flat, empty wrappers for the asking.
If you look thru goodly numbers of pennies, you’ll become able to identify the pre-1982’s on sight. Not all of them, but most of them. On average, they are *generally* darker, of course, but not necessaraily so. They tend to be slightly thicker. I’ve found loads and loads of very shiny 1970’s pennies and, even more 1980 and 1981’s. Once (within the last 2 years) I went into a local B of A branch and got a box of $25 worth of pennies (when I was doing this) About 35 rolls of pennies within that box all had “Bank of America” with a purchase order number and a date something “7-22-82” on them, printed on the paper wrapper. All, every penny in those rolls was pre-1982. Those rolls must have sat untouched for nearly 30 years.
These older pennies are also struck better, more crisply.
The problem with this entire exercise is *verification* when you go to sell them. A buyer cannot easily verify that your submission is all composed of these earlier pennies without examining them at great effort.
A better exercise, IMO, is getting $1000 worth of half dollars from your bank. Last time I did this, I got exactly 1 90% HD, which was disappointing. The time before, and it was in 2010, I got 4 qty 90% HD’s and 9 qty clad ones. And a SBA dollar and one of those new manganese-type dollar coins.
Thanks. I missed it back in Febuarary.
I’ve been hand-sorting two $25 boxes a month for a while, I was getting close to 30% pretty consistently. But I stopped keeping count the last couple of months.
There is a problem with your analysis. It presumes that nickel and copper weigh the same.
[grin]
"The penny's composition was changed in 1982 because the value of the copper in the coin started to rise above one cent.[7] This was mainly caused by inflation. Some 1982 pennies use the 97.5% zinc composition, while others used the 95% copper composition."
What about these?
I’ve heard the pennies made before 1982 have more copper in them.
mark
Pennies made before 1982 (1981 and before) were 100% copper. Since then they are zinc with a very thin copper coating.
Time to do some serious date checking then.
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