Another Outside the Yard Question-

[wagsthadog]

Hi all-

awesome responses by all on the Flat rate box thread- thank you!

...I think that going to refiners will probably be the best bet for all of us when copper goes way up, but I have another question about that-
Assuming that flat rate boxes are done away with, BUT, the cent is demonitized, great- we can all melt away! However, I live near Chicago and I know a couple scrapyards, but if we no longer can ship economically, aren't we pretty much at the mercy of the refiners? I know the free market will prevail on price, but I can see a bit of a bottleneck/monopoly forming at our local scrapyards if the no FRB/legal melt scenario takes place-

You have $1000FV in cents to melt. To ship them and realize a profit would be almost impossible. So, unless you have a furnace in your garage (and even if so you still need to sell the melted copper) it's off to the scrapyards. But, I can't see any of us living in an area where there are more than three or four metal recyclers in a feasible distance, so, since they would likely control the scrap in your town, what's to stop them from charging poor rates? I can already envision all the excuses- "Yeah, copper is $9/lb, but we're so backed up, we can only pay $6/lb" or, "yeah, copper is $12/lb, but only for .999, yours is 95%, so you only get $4/lb" or, whatever excuses a monopoly can think of....

I can see coin shops getting on board with buying copper cents, but how many of THOSE do you know locally? Secondary market, maybe, but if "Cash 4 Copper" shops start springing up, we all know how well they will pay....

I'm not a Debbie downer on copper, far from it, but rather I'm just trying to think outside the box for all of us as copper bugs to help plan for any snafus down the road. BELIEVE ME, I firmly believe the pros far outweigh the cons on copper, but I lately have started holding more copper and have been trying to get down to brass tacks and iron out some of the very possible crapola that we all might come up against-

I apologize if this thread has already been covered, but I would love to hear some responses or a redirect if covered....

thanks!
wags

[slara512]

At prices that high, mostly likely would not be a price spike but new levels. Therefore prices would stabilize at the new higher prices over time. The reason I mention this is that the market would gets accustomed to the new value of copper pennies (at $12/lb might be about 9 cents each). Im sure ebay and more private buyers, even coin dealers, would be interested in liquidating some of your hoard.

An even funnier thought is that if copper is 9-12/lb, zinc will be over 3-4 dollars a pound and zinc pennies will then be worth 1.5-2 cents each
would everyone start hoarding zincs or just stop returning them back? no more zinc penny dumping hassle?

[jldco]

I've pondered this point many times to myself, with no satisfaction, I'm looking to you good folks to help me out... I think I get stuck inside the box more often than not...

[inflationhawk]

If inflation takes copper and/ or zinc values that high, you can bet the penny will have been discontinued, it would serve no purpose in society.

[Madwest]

If inflation takes copper and/ or zinc values that high, you can bet the penny will have been discontinued, it would serve no purpose in society.

Inflation already brought us there. In fact, we're there for Dimes, Nickels, and Cents.

Total inflation from January 1914 to October 2011 is 2,164.21%

Today's quarter dollar has barely more buying power than a cent did in 1914. If the equivalent of 22 of today's cents was good enough to be the smallest denomination then, why not now?

[TXBullion]

What will happen when/if it is legal: Supply chains and logistics will already be in place for melting on a large scale for the big dogs in the market. Those people will be getting 90-05% of melt because of the quantity they can supply those who have a few hundred pounds or a thousand pounds will need to get their copper to those big dogs. The big dogs will then offer you a payout based on what they are getting (less their cut). It will be more than you could get on your own but less than what the big dogs are getting. This is the materials market, I do not know where the coin market may be. If it sells at melt as coin bullion to other collectors/investors, that will be your best bet

Thats what I believe will happen.........

[Verbane]

If it sells at melt as coin bullion to other collectors/investors, that will be your best bet

Thats what I believe will happen.........

+1


If/When copper gets to $9-12 a pound, Mint production for the cent will likely already have ceased. Local dealers/collectors/investors will move in to fill the void in the current local markets. This is where you will get your best price.
Consider that a refiner only pays a percentage on 90% silver, but you can usually sell to collectors/investors for much closer to melt value. The same should hold true for copper LMC.

[everything]

We need to have a poll until how long until the cent is finished. The whole LMC market will change if anything happens to the penny. Heck, the whole world as we know it might. Still, the penny, it's a slow market to develop. Inflation may give it a boost here eventually, unless we have a complete deflationary collapse one day, otherwise it's just business as usual.

[wagsthadog]

What will happen when/if it is legal: Supply chains and logistics will already be in place for melting on a large scale for the big dogs in the market. Those people will be getting 90-05% of melt because of the quantity they can supply those who have a few hundred pounds or a thousand pounds will need to get their copper to those big dogs. The big dogs will then offer you a payout based on what they are getting (less their cut). It will be more than you could get on your own but less than what the big dogs are getting. This is the materials market, I do not know where the coin market may be. If it sells at melt as coin bullion to other collectors/investors, that will be your best bet

Thats what I believe will happen.........

Hi TX-

Yeah, I follow 100% what you are saying, and I think you are on the right track- it does seem that all roads lead to having to go big or go home with copper pennies tho. Penny discontinuation/melt lifting/other refiners coming on line all seem likely to me too, but I think that for selling, no matter what happens, timing will be everything as well. Pre-empting the gluts that may come with a penny melt lift and being one of the first sellers would seem to me to secure the best price (selling at the top) and I'm sure that initially there will be a lot of ..uh.."uninformed" people out there JUST hearing about the copper penny resale market and looking to buy in to it at the top. (suckers!! ) That's when I think will be the sweet spot to sell....When a lot of people start coming out of the woodwork from never before and start sorting pennies, the buzz may drive the market price of copper cents up- then, a few months later, when most people realize what a PAIN it is to get, sort, and cash in significant amounts of pennies, they will exit and the buzz will die down with prices...leaving us, faithful realcent members, exactly where we started, hopefully richer?

Actually, the wheels may be already turning on people getting into pennies due to Highroller's vid...see some new members...interesting times!

wags

[wagsthadog]

Hi all-

afterthought-

If any new members are reading this, I apologize if you took offense to a sentence in my previous post- I do not mean that YOU members are suckers, if you are on this forum you are still part of the .009% of people out there who know about the copper penny market. I was referring to the masses out there that don't know the first thing about precious metals, inflation, etc.

Out of curiousity, if you are new and reading this, what did make you join?

wags

[Lemon Thrower]

i think there willl always be a flat rate postage market, but the rate may be higher.

if you figure that you can ship 100 FV for 10 FV, the postage cost currently is roughly .1X . So if the melt ban is lifted and copper is at 3X, i figure the market price goes up to say 85% of 3X, or 2.55X. You may have to subtract .2x for postage rather than .1x, but you are still at 2.35X there.

85% is my guess because copper is not a precious metal, is bulky, there is other scrap sources available, etc.

[s3p2]

The way I see it when the time comes and there is an easy buyer, I will sell them. Who knows when. I also think of it this way: there are places out there already that will trade for silver dimes or quarters. In a bartering society a roll of copper may be worth the equivalent of a silver dime....who knows?

[s3p2]

Ron Paul literally said in a debate about two months ago he could get gas down to a dime per gallon. He was cut short in the debate and everyone blew him off, but I knew what he meant. Later during an interview he explained the value of a silver dime. The interviewer said "$2.55 for a dime!... really?"

[slara512]

... I also think of it this way: there are places out there already that will trade for silver dimes or quarters. In a bartering society a roll of copper may be worth the equivalent of a silver dime....who knows?

I like the sound of that. when copper cents were at 3 cents each, the roll of copper would be 1.50 and the war nickels right now are about 1.80 and silver dimer at 2.33.

I wonder if anyone would trade 2 copper penny rolls for a war nickel right now, you think? $2 copper w face at $1 for 1 nickel with face of 0.05? would with war nickels do that trade and reduce face value risk?