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The US Mint lost $69M making pennies last year
- Finnucane 8y agoThe point of the mint is making money, not making money.
- refurb 8y agoYeah, the headline seems dumb. If the mint creates a $100 bill for $1.50, did they make $98.50? No. The purpose of the mint is to maintain the US currency. It's a cost center, not a profit center.
- noer 8y agoUnless I'm reading it wrong, they do think of it that way (on coins at least): >Fortunately, dimes and quarters are cheaper to make, costing less than their monetary value. So the Mint makes up the losses incurred on pennies and nickels with its 10- and 25-cent coins, and last year reported making $391.5 million in seigniorage. Also, paper money isn't produced by the Mint, it's produced by the Bureau of Engraving & Printing
- mortenjorck 8y agoThe author of the article thinks of it that way, but I have to think the article is written from a misguided premise. The Mint may publish those numbers in the form of a balance sheet as a novelty, but as far as I understand, they don’t govern the money supply any more than the Bureau of Engraving and Printing does. Their scope is to strike currency, and I would think the exact monetary value of it is immaterial to that mission.
- slededit 8y agoSeigniorage used to be an important revenue generator for governments. This has largely subsided with the transition to bank notes which don't operate under the same market dynamics. But the historical inertia is still there.
- thebooglebooski 8y ago"Making" and "creating" are pretty ambiguous here. The mint literally creates physical money (coins). But in the end, the government actually does generate revenue, that gets calculated into a profit or loss for the country: https://www.investopedia.com/terms/s/seigniorage.asp https://www.investopedia.com/terms/s/seigniorage.asp $100 bills DO generate profit. Pennies generate a loss. If you look at all of the currency in aggregate, it generates positive revenue for the country.
- tylerhou 8y ago$100 bills do generate profit for the person printing them, but in aggregate they inflate the currency as a whole. This inflation, in theory, cancels out the wealth "created." So when people print money, they aren't generating any wealth - it's just a wealth transfer from people who have paper money to the people who print it.
- andyzweb 8y ago$100 bills generate close to 0 profit for the United States Treasury as they are sold to the Federal Reserve Banks at manufacturing cost. However coins are sold by the United States Treasury to the Federal Reserve Banks at face value and can generate a profit/loss based on the difference between the face value and the cost of manufacturing.
- PKop 8y agoFor some acceptable price yes. This isn't unbounded though. At some point they most certainly would stop producing a unit of currency if it cost way too much vs it's value.
- pishpash 8y agoYes they did make $98.50, and it is profit. The job of the Mint (and the Bureau of Engraving & Printing) is to use the monopoly of seignorage to make money out of thin air. As much as there is demand for coins and bills, they will sell into the market. The job of maintaining (the value of) the US currency is in the hands of the Federal Reserve.
- pdq 8y agoTechnically you mean currency, but the pun is great.
- minikites 8y agoPennies are not effective as currency. You can't use them in places you typically use coins (parking meters, vending machines, automated road toll collection) so we're using tax dollars to fund the creation of useless zinc circles.
- someone7x 8y agoExactly this. Pennies not being accepted in so many use cases requiring exact change is just ridiculous.
- chiefalchemist 8y agoThe purpose of the mint is to give legitimacy to what is a fiat currency.
- asdsa5325 8y agoNo, the mint doesn't give purpose to money.
- chiefalchemist 8y agoLegitimacy is not the same as purpose
- mikestew 8y agoSo get rid of them. At one point in my life, a long time ago, things could be purchased for a penny. That time has long passed. Now pennies are used just to make the math work out. Round everything up a nickel ($0.05) and call it a day. Or look at it another way: inflation has made the nickel from my youth into today's penny.
- tomjakubowski 8y agoWhat can you buy at a shop with just a nickel? I don't think I've purchased any item at a shop for less than ten cents in my thirty years; and it's rare to see anything that costs less than a quarter.
- eachro 8y agoI remember buying some of these inidivudal sour patches candies at a local deli for 10 cents a pop about 10 years ago. I wonder what the price is now. Probably a quarter I'd guess.
- 83457 8y agoI used to buy Bazooka bubble gum for 5 cents from the store as a kid in the early 90's. Since then I can't think of anything else for that amount of money
- salgernon 8y agoArgh. It used to be 2¢ in the late 70s. My 9 year old self went in to buy 50 pieces with my birthday dollar bill - and on that day learned about sales tax. (Tax was $0 on a single piece, 8¢ on 50...) I asked the guy to ring me up 50 times, but he declined...
- zip1234 8y agoThe camp store at a place we go every year still has candy that is 5 or 10c. They also have mini tootsie rolls that can be purchased for 2-3 cents (used to be 1)
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- Ensorceled 8y agoCanada got rid of the penny 5 years ago and the paper $1 in the 80s. We also switched to metric in the 70s. We’re not that dissimilar from the US but they seem to have an inability to make these kinds of systemic changes.
- refurb 8y agoWalking around with 2 lbs of loonies and toonies in your pocket sucks to be honest. That said, I probably use cash a handful of times each year. Getting rid of the penny was smart though.
- wolco 8y agoI think we rushed away the penny too quickly. Glad they stopped at 2 dollars the 50 dollar coin just doesn't seem right.
- athenot 8y agoFWIW, the Euro is coins from €0.01 to €2, then paper from €5 to €500. I find dollar bills even more annoying than pennies.
- mattnewton 8y agoDollar bills take up almost no space, and are easier to handle than coins. Aside from durability, why would you switch?
- greenshackle2 8y agoI find it easier to manage a jar of coins on my nightstand, than a wad of cash with a bunch of half-crumpled 1-dollar bills. It's not like I need to carry a bunch of small denomination currency anyway. The 1 and 2 dollar coins are larger and are made of different materials so it's not hard to pick them out of the jar if I want to use to pay for coffee or something.
- landcoctos 8y agoNot even a rounding error.
- bumblebritches5 8y agoStop pushing this propaganda, we're not getting rid of pennies no matter how irritating your fucks are.
- ortusdux 8y agoWhen the half penny was decommissioned in 1857 it was worth the equivalent of 10-15 cents in today's dollars. It was decommissioned because inflation had made it nearly useless and the metal was worth more than the coin.
- snarf21 8y agoWe should get rid of everything below the quarter. All we need are some rules for rounding up (or down). Then we could also drop the $1 dollar bill for a coin. A lot less confusion with only two main coins in circulation.
- iv597 8y agoWe've had $1 coins for a hot minute. You can almost only ever find them at the bank, post offices, and some other government places (the Sound Transit ticket kiosks here in Seattle spit them out, I found out last week), but they exist. We also have/had a 50c coin, but it's huge and I believe out of circulation these days.
- djhworld 8y agoI think we have a similar problem here in the UK with 1 & 2 pence coins costing more than what they are worth. It's not entirely clear though as The Royal Mint doesn't reveal their production costs, but it really wouldn't surprise me if making the 1/2p coins run at a loss
- oldcynic 8y agoUK got rid of farthings and halfpennies when they exceeded face value, and the £1 note decades ago. Pennies and 2p became copper plated steel for the same reason. Pre 92 bronze ones are worth about double. Coppers can't be worth keeping around much longer. I doubt even penny sweets still exist.
- murukesh_s 8y agoWondering if someone is collecting them and extracting the metals out and selling for a profit?
- mvid 8y agoThat would be interesting, but I believe it is explicitly illegal. Doesn’t seem worth the risk and overhead.
- mertd 8y agoThat would be a federal crime, at least for now. But there seem to be people hoarding pennies in hopes of legislation to change.
- murukesh_s 8y agoWhat if it goes out of circulation? Is it legal then?
- chuckkir 8y agoThere are people storing up closets full of the old full-copper pennies waiting for the day that the penny is discontinued and they can get scrap value that is higher than the face value. For now they aren't allowed to deface money so they're just storing them. I don't even know if it's worth the time spent sorting, but everyone needs a hobby.
- anoncoward111 8y agoAdditionally, they're a real pain to melt down profitably, even if it were legal. It only makes sense at very large scale, which means only the companies that invest in big foundries will be making real money if it ever becomes legal to use copper pennies for copper. A good analogy would be like collecting aluminum cans XD
- michrassena 8y agoIt's illegal to do so, and the fines are very high. https://www.law.cornell.edu/cfr/text/31/82.2 https://www.law.cornell.edu/cfr/text/31/82.2
- downrightmike 8y agoAnd the Zinc mining stocks are uptoday: Teck Resources (NYSE:TECK), Hecla Mining (NYSE:HL), and Hudbay Minerals (NYSE:HBM).
- deleted 8y ago[deleted]
- LordAtlas 8y agoWhen I visit America, pennis are the most useless thing to carry out. All they do is add tons of weight and bulk in change without providing any utility.
- InternetUser 8y ago> tons of weight and bulk What is your height and weight?
- iamcasen 8y agoAm I the only one who views pennies like an extreme annoyance? I would rather throw pennies in the trash than have them. They are literally THAT worthless. They take up far more space and weight than they offer in value. It seems like such a massive waste to continue using valuable metals to create something so worthless. Honestly, I think quarters should be the only coin we have.
- gcbw2 8y agoYes and no. No in the sense that you not the only one to see pennies as an extreme annoyance, they really are. But you are alone thinking the annoyance is easy to get rid of. They are a very good reminder of the currency history/direction, and cheap if you think about the consequences of letting this go unchecked.
- JoeAltmaier 8y agoI've moved beyond that. I discard all change, ruthlessly. If there's somebody nearby who wants them, I give them the whole handful of change. Otherwise it all goes in the trash on the way out of the store. Used to wear holes in my pants pockets, get stuck in dryer etc. Cost more than it was worth, in wear and tear, and in emotional energy to manage it. You can't imagine the freedom you feel when you discard your first handful of change! Just toss it and walk away!
- coin_shitter 8y agoI love to throw my coins in the toilet and then shit all over them.
- tetromino_ 8y agoThat only works if you're lucky enough to not regularly need a pocket full of coins to e.g. use the washers in the next-door laundromat.
- tytytytytytytyt 8y agoCards that cost $3. :|
- rrauenza 8y agoRelated: US nickels cost seven cents to make. Scientists may have a solution https://qz.com/1316940/us-nickels-cost-seven-cents-to-make-scientists-may-have-a-solution/ https://qz.com/1316940/us-nickels-cost-seven-cents-to-make-s...
- eli 8y agoQuartz is really owning this genre of badly misunderstanding what the mint does. The cost of manufacturing coins is an expense that has no bearing on the denominated value of the coin.
- minikites 8y agoThe point of currency is to facilitate commerce and pennies don't do that. You can't use them in parking meters or vending machines (for example) so we're spending tax dollars to create objects with no function.
- paulddraper 8y agoThose are valid points. As the parent said, the manufacturing cost is orthogonal.
- rrauenza 8y agoI mostly thought the metalurgy was interesting -- and that specific conductivity is apparently important.
- AceyMan 8y agoI've joked to my pals that if the POTUS (a) eliminated the penny and (b) moved gov't to A-series(ISO 216) paper sizes (biz would then follow) at least then I could feel this presidency is a net (aggregate) neutral from a utility PoV. A nickel is fine-grained enough for current goods pricing. While we're at it, let's get rid of the dime, too. They are too small to fish for in pockets and purses. In fact, one famous US retailer has a policy of not stocking dimes in their cash room because the founder believed "dimes lose money."
- parliament32 8y agoHere in Canada we got rid of the penny some years ago. If you're paying with cash, the total just gets rounded at the register. Honestly I don't miss it.
- izzydata 8y agoI haven't used physical money in a decade, but they should definitely stop making pennies and nickles at minimum.
- swanson 8y agoThey should sell ads on the back of the penny. "A Penny Save is a Penny Earned - Chase Bank" A durable, historical, innovative new channel that also makes minting pennies profitable. Everyone loved collecting those state quarters they made a few years back. Of course, if this is successful we can move upstream to other coins and eventually dollar bills. Alternatively, we could allow rich people to put their face on the penny instead of that old president guy on there now. Just the media exposure alone to be the first company to sponsor the penny would probably yield a positive ROI. And think about how jealous the CEO of McDonalds will be when forced to dispense Burger King branded coins from their automated robot cash registers.
- antcas 8y agoThis is one of the best terrible ideas I've ever heard.
- los_angeles 8y agoIn Hong Kong paper money is designed and issued by private banks. Works fine.
- antcas 8y agoAre consumer brands advertised on those notes? Having private banks print money is a lot different than selling ad space to McDonald's on your dollar bill.
- los_angeles 8y agoYes, the consumer brand (HSBC in this one for example) is printed and advertised heavily on the money: https://www.leftovercurrency.com/wp-content/uploads/2016/11/20-hong-kong-dollars-banknote-hsbc-2010-issue-obverse-1.jpg https://www.leftovercurrency.com/wp-content/uploads/2016/11/...
- mechanicalpulse 8y agoAnd think of all the chuckles to be had when asking the corporate sponsor how many "impressions" they're looking for!
- elvirs 8y agoI fucking hate pennies. Make it a federal law that all prices should be rounded down to 5 pennies and make smallest coin a nickel.
- minikites 8y agoWe still have the penny because Jardin Zinc Products (the manufacturer of penny blanks) lobbies the government and pays for astroturf campaigns to keep the penny. http://www.post-gazette.com/business/businessnews/2007/08/15/Jarden-Zinc-Products-lobbies-Congress-to-keep-the-1-cent-coin-from-going-extinct/stories/200708150320 http://www.post-gazette.com/business/businessnews/2007/08/15... https://www.publicintegrity.org/2014/07/02/14959/saving-penny-makes-cents-zinc-backed-front-group https://www.publicintegrity.org/2014/07/02/14959/saving-penn...
- danieltillett 8y ago"Never attribute to stupidity what can be explained by corruption."
- boromi 8y agoI think Canada has got rid of pennies; US should also follow that lead, hopefully.
- speg 8y agoI don’t get why the USA struggles with this and tap to pay. I thought 🇺🇸 was supposed to be advanced?
- Spooks 8y agoCanada did! The last Canadian penny was minted in May 2012, and ceased the distribution of them as of February 4, 2013. No real issues either (it still remains legal tender). Non-cash transactions are still denominated to the cent, the rest is rounded. On the positive side the mint has more coin in their bank now!
- jacobsenscott 8y agoAs long as there's some old fossil in the senate with fond memories of buying a salt water taffy for a penny, the penny will be with us.
- VirtualAirwaves 8y agoHey @dang -- why do you tolerate ageism here? Certainly you don't want fodder for an age discrimination lawsuit against YC do you?
- jcampbell1 8y agoI throw all pennies and nickels away or leave them with the cashier. I don't pay with cash all that often so it adds up to a few dollars a year. One wonders how much retailers spend paying people to fetch pennies and nickels as change, or waiting for people to dig out the right number from their pocket or purse. I am sure it is an order of magnitude larger than $69 million. Obama's only objection to removing the penny was Abe Lincoln. Let's put him on the dime, and Roosevelt on the $20, and Jefferson on the $50, and Grant on the $2. Andrew Jackson's descendants may have tears, a trail of tears.
- XalvinX 8y agoDude, I'll take free money all day long. Pennies and nickels spend just like anything else. At least you could give them to a homeless person or some children to buy some candy with or something. You don't understand something very basic about life. Waste not, want not. Someday you may remember your actions if you ever end up broke and homeless.
- paulddraper 8y ago> Between production costs and shipping, they cost $0.0182 each, which totaled to $69 million (pdf, p. 9) in losses compared to their total value Say what you want to about a various coins, but this is just stupid. Does QZ think a coin is used just once? Coins average three decades of use. Reporting minting as if it has some sort of net loss or profit is idiotic. (By that logic, how much revenue did the US Mint have last year from $20 bills?)
- protomyth 8y agoHow about we forget the insane idea we need to divide the dollar into 100 parts and back it off to 10 making the dime the new penny and getting rid of the whole 1 and 5 cent steps. So, it gets rid of of the penny, nickel, and quarter. We could save a lot of money just by converting the 1 and 5 bills to coins.
- XalvinX 8y agoThere have been dollar coins in America forever and still are. The general public refuses to use them, or just collects them and they never circulate.
- protomyth 8y agoYes, but the US has never removed the paper money.
- XalvinX 8y agoI don't understand what you mean. They removed the paper money the explicit said "this is good for one silver dollar and can be exchanged at the US Mint at any time" (those were called "Silver Certificates" and look a lot like the dollar bills around nowadays, without the promise. Now it says "backed by the faith and credit of the US government" (or similar) ....so "backed by a bunch of hot air" basically. HUGE DIFFERENCE.
- protomyth 8y agoThey did not remove the $1 bill when the redid the $1 coin.
- ravenstine 8y agoI'll be sad they day they get rid of pennies. They are a great source of zinc for metal casting. :)
- linkmotif 8y agoThe value of pennies to the economy must be much greater than $69M right? My reasoning is: if you get rid of them, who’ll get short changed? The consumer. And by how much throughout the entire cash economy? A lot.
- Too 8y agoWhy do you assume the consumer will always be short changed? Just use mathematical rounding which is fair. It's hard for merchants to price items so that the total ends up rounding upwards if you buy multiple items. People already subcontiously read 99c as $1 and will apply that thought even more if they know rounding will happen so it's not exactly like you are being cheated. For larger purchases even more so, would you consider $99, $99.99 or $100 different prices? No, the difference is irrelevant since the competitor across the street sells the same item for $89. Even if you were being short changed at every purchase, assume 10c being the smallest coin available, you loose worst case 9c per transaction, assume you make 2 transactions per day. That's total $5.4 lost per month, I can live with that. Especially since it's a worse case scenario, realistically it's +/-0 and even if merchants have a special secret method for winning they can probably only win 5c on average making the loss half of my worst case scenario.
- telchar 8y agoI think the value of pennies to the economy is negative. Every time I have to handle a penny it wastes my time and energy for no gain. I never find having a penny useful unless it will prevent me from getting more pennies. Multiply that by everyone in the country and that is quite a waste of time (i.e. money). There would be almost no loss of economic efficiency if we get rid of pennies but a nice savings in real time and energy, to say nothing of the waste that mining, refining, stamping and distributing them costs.
- InternetUser 8y agoWhy don't you just do what I do: when you buy something in-person with cash and there's change, count the paper money and then just hastily count out the change, knowingly giving more then the exact cent amount, and say "Keep the change, and no need for the receipt." Precious seconds can be saved every time. Also, if I'm in line behind someone who is taking too long with anything up to 2 dollars, I just say "I'll pay it" or I even quickly hand the cashier the money.
- flarpmarker 8y agoReally should just remove the whole second decimal. Get rid of pennies nickels and quarters. Only need dimes and half dollars. No rounding, we just limit ourselves to tenths of a dollar.
- lintroller 8y agoI like the idea of a system that would allow only 2 coins - .5 and .1 - to function properly. However it could potentially mean removing the quarter from circulation completely, unless the holder is willing to sacrifice 20% of its value or has two of them.
- momentmaker 8y agoI read somewhere that there is a lobby group that's preventing the government to remove pennies from circulation. I think they're related to copper/zinc which explains why.
- danieltillett 8y agoThere is always a reason why something that is obviously dumb is done and it always involves corruption. There is almost zero copper in the modern penny so let's point the finger at the zinc industry.
- sunshinelackof 8y agoSurely the value of a penny to The US government is more than just the monetary value displayed on the face of the coin. The ability to store 0.01 USD has to be worth more than 0.01 USD or at least (production cost) - 0.01 USD.
- XalvinX 8y agoBFD. Imagine the profits on quarters though...nevermind hundred dollar bills.
- cornellwright 8y agoPersonally, I'd like to get rid of all coins, and introduce a $0.25 note and call it a day. Round all cash payments up to the next quarter and no more metal money. Egypt has a 0.25 Egyptian Pound note. The last time I was there it was only worth about US$0.06.
- JaceLightning 8y agoThis. Though there is already a $0 .25 coin... Called a quarter.
- BenjiWiebe 8y agoRead again. He wants a $.25 paper bill, and then get rid of all coins.
- AngryData 8y agoWhile I can agree pennies are pretty useless, you don't print money to with the purpose of making money unless you are trying to fuck over your own economy. How many times does the currency get spent? Printing money in pursuit of profit is how you end up with billion dollar zimbabwe notes.
- myrandomcomment 8y ago$69M for the US budget is a rounding error.
- JaceLightning 8y agoTime to get rid of a decimal point! Do we really care about pennies, nickels, and dimes?