This page has been archived and commenting is disabled.
Copper: Part I The new currency.
I don’t know if you have noticed what I
have, but lately it appears that people are using Copper as a poor mans
currency. I started to notice during the crash of 2008, that copper was
being sold in a .999 pure bullion. The photo attached is for a single
troy oz of “Fine Copper”. The list price for this copper, as is, was 12
dollars. Think about that for a moment.
Copper sells for about $4 per pound in the
futures market. The contract size is for 25,000 pounds, and it costs
$250 dollars per penny when quoting copper, the December forward month
is currently quoted at 400.60 pennies, for a total cash cost of $100,150
per contract.
I dont know about you, but I would love to
have a business where my future cost of inventory was 27 cents per oz,
and after some remarketing costs, I am able to charge $10 to $12 per oz.
Check out this google link to Copper Bullion for sale.
It’s not just the 1 oz bars, people are now selling copper bullion in
kilo bars, coins, rounds and pretty much anything else they can make it
look like a legitimate currency.
The ironic aspect to this, is that if the
rumored one world currency is deployed, and it has in it, physical
commodities like copper, you can expect an increase in crime to break
out. If people started to look up at power-lines and instead of seeing a
few pennies per pound in realized value at a junk shop, instead becomes
thousands of future World Dollars, we will have problems.
Utilities, which are already heading
underground will have to be moved there even quicker, and the deployment
of new communications like WiMax will be necessary. The era of cell
phones, and 4G internet, will end the need for copper to be installed in
homes going forward. The Net will always be there, and why leave your
phone at home wired to the desk?
In simple terms, we are close to turning a
point in the technology curve, where the value of the copper in the old
POTS (plain old telephone system) is more valuable torn out of the
walls, than left in them. Consider that for a moment. Now, think about
how easily accessible to anyone this stuff is. Savaging will greatly
outweight the cost of trying to find job’s for our chronically
unemployed.
The streets are currently lined with money
hanging from wood poles. When you think about buried fiber optics,
WiMax and Cell phones, the question becomes why do we have all of this
copper in the walls, buried under the yard, etc.
Ironically, copper is already one of the
most owned metals, due to its usage in home building. It could be
argued that it is already distributed to the masses, and as such could
be considered a currency already.
A buyer of an abandoned house in today’s
economy *already* has to make sure that it still has its copper in the
walls. It takes very little effort in the big picture, to strip out
hundreds or thousands of pounds of copper from an abandoned home or
factory.
If Copper becomes part of the next global
currency, the world will have a new crime wave. The only difference, is
that it will be based on a physical commodity changing hands, or at
least represented in the exchange. While there is not enough Gold in
the world, or Silver in the world to act as the physical basis of a
currency, there is enough Copper.
Is that enough of a reason to develop it into an international currency? What say you?
Disclosure: Jack Barnes has no exposure to Copper, or any companies listed in this article. This disclosure and others are available at JackHBarnes.com
»
- advertisements -
Barnes makes Solid Copper Bullets:
http://www.barnesbullets.com/
Great for taking larger game like Elk.
Non Toxic too!
nickels, bitchez: http://www.coinflation.com/coins/1946-2007-Jefferson-Nickel-Value.html
10/4,
Nickel is GTG.
Buy $10k in nickels from the bank.
We need to get industrious, and get back some of that 9 Trillion, that went to everyone around the world.Except US.
What a useless article.
The article was unaffected, simple and sincere. I found its authenticity refreshing.
I'm surprised no one has brought up a few things yet:
1. JP Morgue is trying to corner the copper market - they bought $1.5 beelyun in copper on the London Metals Exchange recently. Yeah, ZH was on that:
http://www.zerohedge.com/article/jpm-corners-copper-market-lme-says-not-...
2. What impact does copper have on other commodities markets, specifically silver? The JP Morgue currency manipulation runs along the lines of: silver impacts gold, gold impacts the dollar. Is the JP Morgue trying to make the tip of the spear copper instead of silver now? I do NOT know nearly enough about the copper, or its impact on other markets, so I can't answer. Would be nice if someone could fill us in.
SB,
I think JPM,is using the HUGE purchase to offset their Silver ass kicking.
I was thinking the exact same thing when I saw this article. Odd how just a day before we read how JPM is cornering the copper market and now it's the "new currency". Conincidence?...I think not
That works out to one percent of the market- hardly cornering it. Further, they are required to make it available to trade if someone wants it (rules of the exchange).
JPM might just be making a bet on price movement over time. Just my two coppers.
There already exists a small-weight copper "bullion" coin, does there not ? Any Lincoln cent minted prior to 1982 is .950 copper; in "pure" terms, each coin contains 2.95 gm of .999 cuprum...it is even legal tender. One troy ounce .999 pure ingots of copper for twelve dollars...Phineas T. Barnum is beaming from beyond.
It's not just copper - steel will bring you around $17/lb at most junkyards. And stainless steel is big $$$$, especially for higher grades. Of course, you need a $50K XFR unit to grade SS, so it is not exactly a poor man's game.
17 a pound? What's the address of that scrap yard? I have an 82 Olds rusting away behind the barn. Engine seized. The beast weighs 4500 pounds. And your guy is offering me $76,000 for it?
There are companies that will come out and pick up your scrap metal if you have enough. I don't know of any offering 76,000. They come out to farms all the time.
Bad math, sorry, 17 cents a lb. We got $73.80 for a 450 lb heating oil UST last week.
This article is a laugh. Yes, copper could be a currency, it has been used before as a smaller denomination for silver and gold. This would require the recognition of a metal based system- something bankers will be unwilling to do.
As Gekko says above, the argument on quantity is deplorable and has been refuted so many times, I am surprised it still appears. What happens to fiat currency when they want more? They print bills with greater values. Money can have any value. There is more than enough gold and silver in the world to function as money. Especially if it is as specie with a paper receipt system.
As for copper- I can go to any electrical supply and buy a six foot pole, 3/4" in diameter for thirty bucks or so. Why anyone is buying copper bullion coins is beyond me.
Note: Electric grounding poles are copper clad not solid copper.
Recycled copper can be used for many things but only pure, new copper can be used for electrical components that convey current.
As with a long enough time line, all copper use will go to zero, ??
All facts or alleged facts implied here bear no resemblance to actual facts that may imply confusion and are not indicative of future stated facts.
Understood?
Not the ones I buy.
http://www.wflx.com/Global/story.asp?S=12968514
If there is a currency revaluation, copper could spike in price because when paper currencies are revalued, government's don't usually find it cost effective to bother re-valuing coins.
Imagine if pennies in your pocket had a real purchasing power 100x their current value.
That said, Copper takes up a lot of physical space to store value, and even if you want some there's no point in overpaying for it.
pennies are mostly zinc
Now, yes. Switch came in 1982. Both were produced that year. There are lots of copper pennies still in circulation. They made it illegal to melt them for scrap. I save them for casting however.
COPPER BITCHES!!
WTH, it's back !!!
I am not chumbawamba.
Hey Chumba! Nice to see you buddy :-)
Looks like all us old ZH'ers are making a stealth comeback in the comments section.
love the avatar. "i will not obey". perfect.
You didn't sign your name.
Glad you're back. Hope the fire within you is still burning.
PS For full disclosure I hold no position nor intend to hold a position in copper.
Good to see you Chumba.
You can't send electric current down fibre optic wire nor through wifi, and in new buidlings there is plenty of copper wiring installed for powering all the operating systems and the networks ( whether they be wifi or fibre optic for data transmission), and the copper power supply for securityy control systems ( fire and entrance control etc.) and lighting which far outway the quantity of copper previously installed for telephone lines.
The power lines across country may be aluminum yet the transformers are copper wound.
Just because a few born losers are buying overpriced copper bullion does not mean anybody else is going to overpay for it.
The volume of copper wire in a home is generally not considered worth the effort to steal, even by the most bitter foreclosed-on losers who try to take everything of value from the house and vandalize it besides and have plenty opportunity to do so.
Copper plumbing, however, is frequently missing after foreclosures. Go look at some REO listings in bad neighborhoods and you will find plenty with missing plumbing.
The 'bullion' is a scam to suck in people who have no idea they can go down to a metals dealer and buy a bar of copper and saw their own ingots off at a fraction of the price.
I live in a very affluent area and often stop along the road and throw things in my truck people put out for the trash. Motors, jumper cables with a bad clamp, plumbing fixtures, and actual rolls of wire even. My wife had only contempt for the habit until one day we were going somewhere else and I stopped at the junk yard. She followed me through as I put my stuff on a cart and wheeled it on the scale, got a print-out, and went to the cashier's window. Her put-upon scowl changed when she watched the cashier count out a nice pile of 20s. I haven't heard anymore since about being a scavenger.
Rock'n! I am jealous of your skill.
Crackheads have been in the copper currecy markets for a long long time here in Chicago. They are actually a very industrious people.
This article, and your remark, remind me of my first week of law school. In torts class, we were assigned a case, Ryals v. United States Steel Corp., 562 So. 2d 192 (Ala. 1990), (link: http://scholar.google.com/scholar_case?case=1651745108054957973&hl=en&as_sdt=2&as_vis=1&oi=scholarr) where a criminal trespasser (actually, his estate, because he himself was fried to death by 44kV) sued the owner of land housing an electrical switching station. The normal common law rule of landowners' liability, as to trespassers, is that a landowner has a duty not to intentionally or wantonly injure or entrap a trespasser. The Supreme Court of Alabama relaxed that duty, as to a trespasser who enters land for the obvious purpose of committing a crime (here, stripping the copper from the switching station), so that there is a duty only not to intentionally injure a criminal trespasser. Thus the Ryals Court upheld summary judgment in favor of the landowner.
In many other states, the duty owed to trespassers has not been modified in this manner, but courts likely would reach the same result through a defense known as assumption of the risk.
Moral of the story--people have been scavenging for copper (and aluminum) for a long time. I remember at least a decade ago a 50-foot section of guardrail (pretty sure it was aluminum) disappeared from a highway one night in Baltimore, where I live. Makes you wonder how dishonest the scrap yard was who took this from the thieves--as if they didn't know what it was. . .
ha, ha. yeah, scrap yards are in the business of not asking questions. it is sort of like our black market for labor, the economy may come to a halt without the dealings of society's 'underbelly'.
the ruling elite do not mind this activity because it is not a threat to their power. however, if scrap yards ever went corporate, you can bet they would become a target.
Interesting article. However, overhead power lines are aluminum, not copper. The electric lines in your home are copper. The phone line in your home is copper, but is much, much lighter than the electric lines.
A lot of phone company wire is copper plated steel. Due to the nature of metallic conduction more current is carried near the surface of a wire so it works well cheaper. Ma Bell was very cost/quality conscious. We scavengers carry a magnet to ID ferrous stuff.
Important nuance here...when there is any serious amount of current carried in a wire relative to its cross section, the current does NOT mainly travel near the surface.
The power outlets in a house need to have a pretty good cross section in the wiring behind them, because the appliances can pull fairly serious current...10 amps and figures up in that range for hairdryers, small ovens, and so on, and that sort of current doesn't flit around near the surface of the wiring like signal level currents do in tiny little telecom wiring. You need some serious conductor cross section to be able to plug in hair dryers, space heaters, ovens, 3/4 horsepower pool pumps and so on, because at such current levels, the current also runs deep within the conductors. At lower current and higher frequencies doing the math (good old Maxwell and his equations, PBUH) on this you get a prediction of the current being at the surface of the conductors...and indeed this is what is observed, but not at 50/60Hz and tens of amperes.
At really high current densities you get an opposite effect of squeezing the current toward the center of the conductors, because current is electric charges moving, and moving charges make a magnetic field: Physics and or EE students will recall that a left (or right) hand rule applies to the prediction of the opposing directions of the current, magnetic field, and forces on the moving charges themselves. For charges moving linearly along a wire, the magnetic field the moving charges generate exerts a force on them toward the center of the conductor. Again, very important effect at high current density(because the magnetic field density is therefore high and so would be the forces on the charges moving in the field), unimportant at tiny signal level currents in the type of wave guides found in homes and in "the last mile" from home to the closest telecom box.
if a cable is big enough to be measured in MCM's then you can bet that surface effects are dominating.
I get 5g ingots all the time. They only cost a nickel.
[I get 5g ingots all the time. They only cost a nickel.]---Rich_Lather
I was thinking the same thing.
One of my bank tellers finally asked me why I regularly buy rolls of nickels. I told him it was a commodities hedge. Hey, what was I suppose to do explain the whole thing to him?
I wonder how soon the Mint will devalue the metalic content of nickels. 2011? I haven't followed that issue recently. Anyone?
Replacing copper and nickel are common themes within the numismatic community. There are ongoing discussions at the Mint about it as well. Some resin-based coinage has been in development. There are articles in Coin World often about this topic.
The Germans have recently cut silver in the 10 Euro coin from 18 grams to 16 grams. See at Coin World, December 6th, page 152. Copper fineness now at .075 will increase to .375.
[Some resin-based coinage has been in development. There are articles in Coin World often about this topic.]---RockyRacoon
Hi Rocky. Resin-based? How lame is that. Next they'll be talking about colorful clay casino chips.
Thanks for the Coin World reference. Unfortunately, when I cut expenses from our budget in 2009, my magazine subscriptions (incl. Coin World) fell victim on the chop block. And I let my ANA membership expire.
(Incidentally, you were the first person to welcome me some weeks ago when I entered my first post on ZH. Thanks. I read your posts regularly with interest.)
While I can't say for sure whether or not copper will assume the role of a currency or not, I will point to a couple of glaring false assumptions on the part of the author.
Define "enough". How much is enough? 100,000 tons? 100,000,000 tons? "Enough" here is UNDEFINABLE. See, the author is indulging in the fallacy that we need a specific amount of a particular metal for it to act as a medium of exchange. But, in fact, the actual amount of the physical metal DOES NOT MATTER, only price per unit weight does. At, for example, a million dollars an ounce, we have enough "money" and Gold in the world for everyone.
Second, the author assumes that money/currency will be whatever the government says it is (i.e. "If Copper becomes part of the next global currency"). Not so.
In theory, I'd agree, but in practice, if the value of a given limited resource gets TOO high, the granularity of the denominative unit becomes a real problem.
If you and a vendor cannot agreeably evaluate 1.5mg of .999 pure gold to buy the roast-beef sandwich he's selling, you don't really have an effective form of "money," theory and principle be damned.
And yet if you really want to eat the sandwich and the vendor really wants to sell the sandwich an agreement will be reached.
Sure, it just won't involve the exchange of gold, thus demonstrating the problem with the claim that it's the only and perfect form of money.
I doubt anyone really fails to understand the issue.
I do favor a limited-resource backed monetary system, for certain, and gold is a far better choice than many other options. In real life, I don't think there's such a thing as a "perfect" system. Systems will be perfect as soon as people are perfect.
well put. markets find flaws in systems. however, one way to smooth out the disruptions of flaw discovery is to allow competing currencies, especially those which are asset-backed, such as was the case during the Gilded Age in North America for much of the time.
You sure that is roast beef?
I mean we are talking pretty hard times have come upon us if you are trying to buy a sammich with mgs of gold.
Wasn't that long ago (1991) I ate some chocolates whose tips were dipped in 24K gold. Even then I thought it was insane.