My 1st Million At 33 – yes, you can do it too

I’m sure you’ve read the news somewhere else already. The penny coin now costs 1.74 cents to manufacture, while the nickel coin worth of 5 cents now costs 8.74 cents to make. And according to NY Times, now the United States Mint is considering changing the metal compositions of the coins, and banning export and melting down of coins.

The new ban also forbids exporting pennies or nickels in any significant quantities. While the Mint is not concerned about tourists’ pocket change or numismatic collections, it wants to block wholesale export of coins to countries where recycling them for their metal content could be economically viable.

Penalties for violating the ban can include a $10,000 fine and up to five years in jail. “We want to make it clear to anyone considering this that it’s not worth it,” Mr. Moy said.

Back in the days of Roman Empire, the coin compositions were changed to manage the inflation too. More and more cheap metals (copper/zinc/etc) were added into gold & silver coins as time goes on. However, legally they would tender the same amount. People then would hoard/hold onto the more precious original coins, and the bad money drivers out the circulation of good money. Of course, prices of things wouldn’t cost the same as before in terms of the “bad” coins. Inflation ensued, and contributed to the demise of the empire.

“Once upon a time” the one ounce American Gold Eagle is worth only “Fifty Dollar” which is engraved onto it, and the one ounce Silver Eagle is worth only “One Dollar”. Now gold costs about $630, while silver costs almost $14, a monetary depreciation of more than 13 times. If you’re 100 years old, you won’t be wondering why those stupid numbers of “Fifty” & “One” are engraved on those gold/silver coins.

I guess that we will be getting new nickels and pennies pretty soon. I hope that they won’t disappear altogether, or become made of plastics one day.