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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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