How does a composition change or elimination effect us?

[mishra142]

I've read several threads on composition change or elimination rumors and it got me thinking. How would this effect us? Would a composition change effect ctu price? Significantly? I suspect elimination would have a more drastic effect. If you heard official news of a change how would that effect your sorting? Buy as many boxes as you could get your hands on and sort like there is no tomorrow? Or would copper % stay virtually unchanged for years? Just some thoughts, I'd be interested to hear others opinions on this.

Thanks

[Romalae]

In a scenario in which cent composition was altered, I would anticipate that the older pennies would be sent from circulation back to their origins in favor of the circulation of the newer pennies. Plus, it might make the people otherwise indifferent to the penny phenomenon more inclined to remove the coppers. So there would indirectly be a shortage of coppers in circulation, most likely, and what little left of them would become diluted to a great degree. I wouldn't say the same about the zinc ones however, because though it costs the mint well over two cents to make them, the melt value still does not come close to reaching or exceeding face value, so there's no reason they can't be left in circulation (besides the potentiality of their surface to start bubbling up as is common in the older zinc pennies from the mid 1980s). If the whole denomination were to be eliminated altogether, first of all, you'd have to remember that pennies would not be obviated immediately; they'd be gradually phased out. So I think you'd still have the opportunity to get them from the banks, but you'd want to do it with greater haste and exigency because many others will likely do the same and it'd be only a matter of time before the penny became a rarity.

The moral of the story is to be ahead of the game and prepare for whatever happens. Even if the cent continues to be produced and circulated, coppers will still gradually dissipate from circulation so it's best to be on top of it and continue sorting while we still have this great opportunity to invest and to obsess.

[stonewallrabbitry]

I do not think a composition change would have much effect. They changed the composition in 1982 and there was no effect, even if they change the composition I d not see the government sorting and pulling the coppers. They will become more diluted but that is going to happen even if they remain zinc

[inflationhawk]

It makes no sense to change composition of the penny; most of the cost that exceeds its face value is due to circulation and administrative costs not the cost of materials. A change of composition won't do much to reduce the overall costs. If the penny is eliminated, you won't be able to get any from banks. The penny might have a phase out period where it is still accepted as currency, but no pennies would be distributed by banks to propagate their continued usage. Elimination of the penny and change in composition of the nickel seems most likely.

[mishra142]

It makes no sense to change composition of the penny; most of the cost that exceeds its face value is due to circulation and administrative costs not the cost of materials. A change of composition won't do much to reduce the overall costs. If the penny is eliminated, you won't be able to get any from banks. The penny might have a phase out period where it is still accepted as currency, but no pennies would be distributed by banks to propagate their continued usage. Elimination of the penny and change in composition of the nickel seems most likely.

I would think the government would cease minting new pennies and let the current ones circulate until they slowly start to disappear. Look at half dollars for example they are essentially eliminated, very low modern mintage for collecting purposes. Perhaps they would still mint a low number of pennies for the same purpose as the halves. And obviously we can still order halves from the bank, so would pennies be the same? Just a thought.

thanks

[henrysmedford]

It would be huge if the government keeps the melt ban and does all the sorting and melting themselves . We have a chance of being the next Canada. From my past post--

I found this report “THE FUTURE OF MONEY: COIN PRODUCTION” BEFORE THE HOUSE FINANCIAL SERVICES SUBCOMMITTEE ON DOMESTIC MONETARY POLICY & TECHNOLOGY UNITED STATES HOUSE OF REPRESENTATIVES APRIL 17, 2012 http://financialservices.house.gov/uploadedfiles/hhrg-112-ba19-wstate-rbosco-20120417.pdf

(2) Parallel adoption of an alloy recovery program – in which the United States Mint
collects and replaces copper‐nickel alloy coins in circulation with multi‐ply plated
steel coins and salvages the copper and nickel material from the retired coins – has
the potential to generate over $2 billion in additional revenue for the United States
Mint.

Any thoughts?

[mishra142]

So we would have to assume that if the government implemented a alloy recovery program ctu prices would sky rocket? Yes?

[inflationhawk]

Here's a question I really don't know the answer to because I don't live in Canada nor have I followed the situation there. Can you still get pennies from Canadian banks now that they have stopped producing pennies? Has anyone gone in and asked for some from a bank? I know we have some members on here north of the border.

[mishra142]

If you look at canadian copper on eBay completed sales they are going for very near melt.

[dpwozney]

Here's a question I really don't know the answer to because I don't live in Canada nor have I followed the situation there. Can you still get pennies from Canadian banks now that they have stopped producing pennies? Has anyone gone in and asked for some from a bank? I know we have some members on here north of the border.

After a four-month pause at doing this, I asked for, and was able to get, 60 rolls ($30.00) of pennies at a credit union on Tuesday, November 27. (The last time I did this exact same thing was on July 28.) I expect to probably be able to keep doing this until the end of January, at least.