It costs the United States nearly twice as much to make a penny as that penny is actually worth, writes Christopher Ingraham for the Washington Post, reporting that it costs the government 1.7 cents to make a penny.
And pennies aren’t the only problem: it costs the government more than 8 cents to make a nickel.
A new report from the U.S. Mint reveals that it’s still not cost-effective to make pennies and nickels. Pennies and nickels used to be profitable in the early 2000s, says Ingraham, but the cost of producing the coins began rising in 2006 and has only gone up. While currency costs fell overall this year due to declining copper prices, the two coins still cost more than their face value. The rest of American currency is doing alright:
- It costs 5.4 cents to make a dollar bill.
- It costs 8.95 cents to make a quarter.
- It costs 3.91 cents to make a dime.
Ingraham writes that America could save $100 million each year simply by getting rid of the penny and the nickel, noting that Americans lost $105 million in 2013 due to their production.
While, alternatively, the United States could save money by changing coins’ metal makeup, such a move would require vending machines to be upgraded across the country, costing billions.
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He still owned stacks of gold and platinum bars that had roughly doubled in value, but he remained on the lookout for hard stores of wealth as a hedge against what he assumed was the coming debasement of fiat currency. Nickels, for instance.
“The value of the metal in a nickel is worth six point eight cents,” he said. “Did you know that?”
“I just bought a million dollars’ worth of them,” he said, and then, perhaps sensing I couldn’t do the math: “twenty million nickels.”
“You bought twenty million nickels?”
“How do you buy twenty million nickels?”
“Actually, it’s very difficult,” he said, and then explained that he had to call his bank and talk them into ordering him twenty million nickels. The bank had finally done it, but the Federal Reserve had its own questions. “The Fed apparently called my guy at the bank,” he says. “They asked him, ‘Why do you want all these nickels?’ So he called me and asked, ‘Why do you want all these nickels?’ And I said, ‘I just like nickels.’”
He pulled out a photograph of his nickels and handed it to me. There they were, piled up on giant wooden pallets in a Brink’s vault in downtown Dallas.
“I’m telling you, in the next two years they’ll change the content of the nickel,” he said. “You really ought to call your bank and buy some now.”
Anyone want to buy a wheelbarrow?