May 07
Costly Coins
For years people have been campaigning to get rid of the penny because they feel so little value in a single cent. 
Recent developments in the cost of metals indicate that there’s even less value in a penny than anyone realized!
For the first time in U.S. history, USA Today reports, it costs more to make and circulate a penny than a penny is actually worth. And the same thing goes for the nickel:
“The Mint estimates it will cost 1.23 cents per penny and 5.73 cents per nickel this fiscal year, which ends Sept. 30. The cost of producing a penny has risen 27% in the last year, while nickel manufacturing costs have risen 19%.”
The biggest problem, it seems, is that the costs of the metals involved has skyrocketed. While the metal required to create a single penny is still worth less than a full cent, the metal involved in making a nickel is slightly more than five cents.
Oddly enough, The Mint is one of the few government agencies that makes a profit: The Mint sells coins (for face value) to the Federal Reserve. If the coin costs less to make than face value, the Mint pockets the extra change.
The added expenses for the two coins could cut the Mint’s profit by $45 million. Maybe the IRS can send the Mint an “economic stimulus check” to make them feel a little better.
May 8th, 2008 at 7:15 pm
Off topic: I tagged you in my blog for a post about your hopes: http://masooma.blogspot.com/2008/05/hope.html
On topic: as someone with a bit of interest in coin-collecting, I like the penny. As a teacher, I love the newer pennies - cut one in half, place it in vinegar and the zinc inside will dissolve away leaving the copper shell - fun! As a consumer, I’d be just fine without pennies - Oregon gets along fine without them.
May 9th, 2008 at 7:27 am
[…] Patrick notes the costly nature of some pocket change. […]