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Why You Need to Own Nickels, Right Now
Economic Policy Journal ^ | 2-6-2011 | Robert Wenzel

Posted on 02/06/2011 4:25:44 PM PST by blam

Why You Need to Own Nickels, Right Now

Robert Wenzel
Saturday, February 5, 2011

On November 11, 2010, I wrote in the EPJ Daily Alert:

Back at the commodity level, copper is the latest to hit a record at $8,966 a ton. Copper is certainly not a "goldbug" play and is simply an indicator of economic (inflationary) demand. At some point, nickels, which are mostly made of copper, will start to disappear from circulation.
There's right now 6.2 cents worth of metal in a nickel [Note the value is now up to 7.2 cents.-RW]. When I run into someone that does not have a strong background in investing, I now tell them to buy nickels. You need storage space and a strong back to move them around, but a $100 box of nickels (roughly the size of a very large brick) can be lifted without a problem. You can stack plenty of "bricks" on a hand truck.
What's great about this investment is that there is no downside. In the unlikely event that there is no inflation, you can just spend your nickels... again, this is a great conservative investment...I fully expect the coins will eventually climb in value to at least double their 5 cent price.
The government has made it illegal to melt them down, but you will never have to do anything close to that. When you need to liquidate, just sell them to a numismatic dealer.

Gresham's law (bad money drives good money out of circulation) will take over at some price point and the coins will simply disappear from circulation, just like the pre-1965 silver content dimes and quarters have, and trade at much higher prices.
Those silver dimes now have over $2.00 worth of silver in them, the quarters have roughly $5.27 worth of silver, and you will never find one in circulation. The current nickel has 7.28 cents worth of metal content (mostly copper) in it. At some point they will disappear from circulation.
Indeed, that may not be far off into the future, if the story starts to get around about nickels the way it seems to be.

Financial author Michael Lewis told a story about a huge nickel investor, this week on the television show, The Colbert Report. The must see video is here.

Note: You can track the metal value of nickels and other coins at Coinflation.com.


TOPICS: News/Current Events
KEYWORDS: coins; copper; economy; inflation; nickels; silver; survival
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I have thousands of nickels in my stash..
1 posted on 02/06/2011 4:25:48 PM PST by blam
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To: blam

I’m going to start asking my customers to pay me in nickels.


2 posted on 02/06/2011 4:27:43 PM PST by smokingfrog ( BORN free - taxed to DEATH (and beyond) ...)
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To: blam

Copper is at record highs.

3 posted on 02/06/2011 4:28:01 PM PST by blam
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To: blam

There are 146 copper pennies to a pound. Copper is about $4.50 a pound. Therefore each copper penny is worth about 3 cents.


4 posted on 02/06/2011 4:32:26 PM PST by Blood of Tyrants (Islam is the religion of Satan and Mohammed was his minion.)
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To: blam

>>Why You Need to Own Nickels, Right Now<<

To play the nickel machines at the casinos.


5 posted on 02/06/2011 4:33:22 PM PST by Bronzy (We Remembered In November.)
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To: Blood of Tyrants

I don’t believe they’re solid copper anymore.


6 posted on 02/06/2011 4:33:24 PM PST by RegulatorCountry
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To: Blood of Tyrants
There are 146 copper pennies to a pound. Copper is about $4.50 a pound. Therefore each copper penny is worth about 3 cents.

Except that they're now made almost entirely of zinc, I think.

I'm sure someone will be along shortly to correct me if I'm wrong...

7 posted on 02/06/2011 4:34:40 PM PST by EternalVigilance (Is this a Tea Party, like the kind that happened in 1773, or the kind where they serve crumpets?)
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To: blam

OMG There will be a run on the banks tomorrow to buy every roll of nickels in the vault.


8 posted on 02/06/2011 4:36:11 PM PST by Presbyterian Reporter
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To: blam

The downside is that thieves come out of the woodwork to take advantage, stripping homes and businesses (vacant or not) of copper wiring, plumbing, A/C compressors, etc. Even bronze Legion markers at cemetaries are stolen for scrap value.


9 posted on 02/06/2011 4:36:47 PM PST by Freedom4US
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To: EternalVigilance

Ha ! Soon they’ll have to make pennies out of paper. Oh wait ...... that’s reserved for the Dollar.


10 posted on 02/06/2011 4:38:17 PM PST by Amagi (Yo, Homeland Security: Stay stupid. Stay PC. Don't profile. Look for the bomb not the bomber.)
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To: blam

If you filled Christiane Amanpour’s nose full of nickels, she’d be worth a fortune!


11 posted on 02/06/2011 4:38:24 PM PST by Palladin (Obama, go back to Hawaii! Better yet, go back to Kenya!!)
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To: Amagi

*badabing*


12 posted on 02/06/2011 4:40:21 PM PST by EternalVigilance (Is this a Tea Party, like the kind that happened in 1773, or the kind where they serve crumpets?)
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To: Freedom4US
Since 2006, it has cost more than face value to produce the cent and nickel due to the increased costs of base metals. The current composition of the cent is 2.5% copper and 97.5% zinc. The current composition of the nickel is 75% copper and 25% nickel.

the real downside is, the taxpayers are paying more for minting pennies & nickels than what they are worth.
13 posted on 02/06/2011 4:41:35 PM PST by stylin19a
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To: Blood of Tyrants
"There are 146 copper pennies to a pound. Copper is about $4.50 a pound. Therefore each copper penny is worth about 3 cents."

True but only the pre-1982 pennies have copper. New pennies are zinc with a copper skin.

I've done three random evaluations in this area and have discovered that about 10% of the pennies in circulation are pre-1982.

14 posted on 02/06/2011 4:41:47 PM PST by blam
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To: Freedom4US
"The downside is that thieves come out of the woodwork to take advantage, stripping homes and businesses (vacant or not) of copper wiring, plumbing, A/C compressors, etc. Even bronze Legion markers at cemetaries are stolen for scrap value."

That's true...same around here. Good photo identification is now required around here at scrap yards.

15 posted on 02/06/2011 4:44:02 PM PST by blam
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To: Presbyterian Reporter
OMG There will be a run on the banks tomorrow to buy every roll of nickels in the vault.

Yeah, dammit. If this goes viral it will be sooner than expected. I was hoping to have a few more months of quiet accumulation.

Look for:
1) A "new improved" nickel made of something worth around a penny (I've seen foreign coins made out of aluminum(!!!))
2) The government decrying "hoarding" - as they busily melt down the nickels they have. (They did this during the silver coin "shortage" when the clads replaced the "real stuff".

16 posted on 02/06/2011 4:48:34 PM PST by Oatka ("A society of sheep must in time beget a government of wolves." –Bertrand de Jouvenel)
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To: EternalVigilance

Starting in 1982, the pennies have been copper-coated zinc.

For a long time now, I’ve been saving the pennies dated 1981 and earlier. The oldest one I’ve found in my change was dated 1910.

All 1981 and earlier pennies go into a jar, or should I say jars.


17 posted on 02/06/2011 4:53:58 PM PST by july4thfreedomfoundation (A Jimmy Carter got us a Ronald Reagan......A Barack Obama will get us a Sarah Palin)
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To: blam

Pretty soon we will have paper quarters and dimes.


18 posted on 02/06/2011 4:59:18 PM PST by Leisler (Our debts are someone's profit. Follow the money, the vig.....)
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To: blam

I’ve been buying nickels for a while. I buy 20 bucks worth at a time because I don’t want them to ask any questions.


19 posted on 02/06/2011 5:02:05 PM PST by tiki
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To: Leisler

Why bother with a wheelbarrow when you can buy the copper ETF COPX.


20 posted on 02/06/2011 5:04:37 PM PST by spokeshave (WTF....the only thing 0bambi's investments will get us is a bullet train to bankruptcy.)
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To: AdmSmith; AnonymousConservative; Arthur Wildfire! March; Berosus; bigheadfred; ColdOne; ...
Robert Wenzel: Back at the commodity level, copper is the latest to hit a record at $8,966 a ton... At some point, nickels, which are mostly made of copper, will start to disappear from circulation. There's right now 6.2 cents worth of metal in a nickel [Note the value is now up to 7.2 cents.-RW].
:') Thanks blam. What we need in the White House is another FDR, who'd call in all the nickels.


21 posted on 02/06/2011 5:06:50 PM PST by SunkenCiv (The 2nd Amendment follows right behind the 1st because some people are hard of hearing.)
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To: SunkenCiv
"What we need in the White House is another FDR, who'd call in all the nickels"

Yup. The one we have just accumulates idiots.

22 posted on 02/06/2011 5:08:42 PM PST by blam
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To: Oatka
Yeah, dammit. If this goes viral it will be sooner than expected. I was hoping to have a few more months of quiet accumulation.

To say I'm displeased with this posting is putting it lightly.

23 posted on 02/06/2011 5:08:50 PM PST by CommieCutter (I'll get an internet ID when Obama shows his birth certificate.)
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To: spokeshave
"Why bother with a wheelbarrow when you can buy the copper ETF COPX.

I think you've missed the whole point of the article.

24 posted on 02/06/2011 5:09:32 PM PST by blam
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To: Blood of Tyrants

They are mostly made of zinc


25 posted on 02/06/2011 5:16:23 PM PST by When do we get liberated? (A socialist is a communist who realizes he must suck at the tit of Capitalism.)
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26 posted on 02/06/2011 5:17:49 PM PST by SunkenCiv (The 2nd Amendment follows right behind the 1st because some people are hard of hearing.)
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To: blam

Is this article saying to buy current-issue nickels or silver nickels from the pre-junk coin era?


27 posted on 02/06/2011 5:23:59 PM PST by tbw2 (Freeper sci-fi - "Sirat: Through the Fires of Hell" - on amazon.com)
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To: tbw2

silver nickels???


28 posted on 02/06/2011 5:25:29 PM PST by Presbyterian Reporter
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To: blam

Only problem is it is a federal crime to melt nickles.


29 posted on 02/06/2011 5:32:04 PM PST by joinedafterattack
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To: blam

Barney Miller — “The Child Stealers” — Season 6, Episode 15 — Thursday January 24, 1980 — “A self-proclaimed time traveler tells Harris to fine tune his stock portfolio”
http://www.tv.com/barney-miller/the-child-stealers/episode/4197/summary.html

The time traveler told Harris that a huge future precious metals strike destroyed their market value, and the entire world switched to a zinc standard, so Harris calls his broker and springs for a couple of tons. :’)


30 posted on 02/06/2011 5:32:11 PM PST by SunkenCiv (The 2nd Amendment follows right behind the 1st because some people are hard of hearing.)
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To: When do we get liberated?

The ones made after 1981 are. The earlier onesa re copper.


31 posted on 02/06/2011 5:43:17 PM PST by Blood of Tyrants (Islam is the religion of Satan and Mohammed was his minion.)
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To: Mrs. B.S. Roberts

ping


32 posted on 02/06/2011 5:53:21 PM PST by Bloody Sam Roberts (Tyrants flourish only when they achieve a standing army, an enslaved press, and a disarmed populace.)
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To: tbw2
Is this article saying to buy current-issue nickels or silver nickels from the pre-junk coin era?

Nickels were never silver, always nickel. Hence, larger than the silver dime for half the value (a less valuable metal.)

33 posted on 02/06/2011 5:54:23 PM PST by Onelifetogive (I tweet, too...)
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To: jiggyboy; PA Engineer; blam; TigerLikesRooster; Cheap_Hessian; CJinVA; Jet Jaguar; ...

goldbug ping.


34 posted on 02/06/2011 5:55:12 PM PST by Jet Jaguar
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To: SunkenCiv

Ok, I’ve worked the math out based on the latest spot prices for copper and nickel and the US Mint’s formulation for nickels at 25% nickel and 75% copper. I cleaned out my change drawer and weighed 35 nickels on a kitchen scale. The results:

35 nickels weighed 6.1 oz or 0.0109 lb

Scrap Copper at $4.5666 per lb
Scrap nickel at $12.7896 per lb

$4.5666 * 0.0109 * 75% = 3.73 cents copper
$12.7896 * 0.0109 * 25% = 3.49 cents nickel
= about 7.2 cents total per coin


35 posted on 02/06/2011 5:58:37 PM PST by PeatownPaul (Engineer's moto: It's working, let's fix it)
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To: joinedafterattack
Only problem is it is a federal crime to melt nickles.

Not in Canada, Mexico, Cayman Islands, Bahamas, etc. etc. (?)

36 posted on 02/06/2011 6:01:27 PM PST by Zeppo ("Happy Pony is on - and I'm NOT missing Happy Pony")
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To: blam

BFL


37 posted on 02/06/2011 6:10:20 PM PST by WOBBLY BOB ( "I don't want the majority if we don't stand for something"- Jim Demint)
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To: Onelifetogive
Nickels were never silver, always nickel.

Not totally true. 'Wartime nickles' minted 42-45 are 35% silver.

38 posted on 02/06/2011 6:13:09 PM PST by Altura Ct.
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To: blam; Big Giant Air Head

Ping for the poor man’s investing. :)


39 posted on 02/06/2011 6:15:29 PM PST by Marie Antoinette (Proud Clinton-hater since 1998.)
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To: Presbyterian Reporter

During 1942-1945, the US had silver nickles.

From mid-1942 to 1945, so-called Wartime composition nickels were created. These coins are 56% copper, 35% silver and 9% manganese.


40 posted on 02/06/2011 6:15:46 PM PST by packrat35 (America is rapidly becoming a police state that East Germany could be proud of!)
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To: stylin19a

Not just minting - factor in transportation costs from various mints to all the branch banks, and then onto stores and businesses. They end up languishing in jars and coffee cans or under the couch.


41 posted on 02/06/2011 6:18:21 PM PST by Freedom4US
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To: blam
Bookmark
42 posted on 02/06/2011 6:28:09 PM PST by ExSoldier
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To: tbw2
"Is this article saying to buy current-issue nickels.."

Current issue...the nickels you presently have in your pocket.

43 posted on 02/06/2011 6:32:24 PM PST by blam
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To: Onelifetogive
1942 - 1945 Silver Jefferson Nickel Value (United States)

35% silver, 56% copper, 9% manganese
Total Weight: 5.00 grams

Comments: World War II prompted the rationing of many commodities. Nickel was highly valued for use in armor plating, and Congress ordered the removal of this metal from the five-cent piece, effective October 8, 1942. From that date, and lasting through the end of 1945, five-cent pieces bore the regular design but were minted from an alloy of copper, silver and manganese. It was anticipated that these emergency coins would be withdrawn from circulation after the war, so a prominent distinguishing feature was added. Coins from all three mints bore very large mintmarks above the dome of Monticello, and the letter 'P' was used as a mintmark for the first time on a U. S. coin. [ ? ]

44 posted on 02/06/2011 6:39:45 PM PST by blam
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To: SunkenCiv; Travis McGee
Get you nickels now:

House Passes Bill For Steel Cent and Nickel(5-9-2008)

The House debated on the legislation and finally voted yesterday to change the metallic composition of the penny and 5-cent nickel to a less expensive copper-colored steel.

BTW, Freeper Travis McGee has been telling us for years to stock up on nickels.

45 posted on 02/06/2011 6:48:10 PM PST by blam
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To: july4thfreedomfoundation

gotcha beat....we’ve got a wheat 1903 copper penny!


46 posted on 02/06/2011 6:55:41 PM PST by goodnesswins (I'm not a great man....I just believe in great ideas! Ronald Reagan)
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To: blam
If that Italian cold fusion thing is the real deal, it's a nickel-hydrogen reactor. Shhhhhhhhh!
47 posted on 02/06/2011 6:55:49 PM PST by kiryandil
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To: goodnesswins
gotcha beat....we’ve got a wheat 1903 copper penny!

Considering they didn't start making Lincoln wheat-ears till 1909, your penny is probably worth a fortune.... /grin

48 posted on 02/06/2011 6:59:47 PM PST by kiryandil
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To: kiryandil
"If that Italian cold fusion thing is the real deal, it's a nickel-hydrogen reactor. Shhhhhhhhh! "

Geez, we'll be rich. Everyone will have a cold-fusion reactor at home, eh? (They'll need my nickels)

49 posted on 02/06/2011 7:04:23 PM PST by blam
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To: kiryandil
My local coin shop (Loop Coin) is selling 'everyday' wheat pennies at 100 for $4.25.
50 posted on 02/06/2011 7:08:03 PM PST by blam
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