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The article suggests that if the government abolishes pennies then it would be legal to melt them down. Is there a good reason for believing that? Germany had

by bloak 5y ago

The article suggests that if the government abolishes pennies then it would be legal to melt them down. Is there a good reason for believing that? Germany had something a bit similar. The two Pfennig coins made before 1968 were pure bronze and worth more than two Pfennig as scrap metal in later years. But it would be illegal to melt them down. And they were abolished, of course, when Germany switched to the Euro at the end of 2001. If you found a hoard of them now, would it be legal to melt them down? (Apparently there was an official exception to the law against destroying currency. Those coin-operated machines that squash a small coin and stamp a picture on it for tourists, apparently they were officially legal, rather than just allowed because "we're not going to bother enforcing the law in this case" as they would be in most countries, I guess.)

dheera 5y ago
Why would you melt them down? If they abolish pennies their collector value would probably be much more than 2 cents. Pennies from the 19th century can be worth several dollars, a few specific ones even several hundred dollars.
- iso1631 5y ago
  If there's only a few then perhaps. There are how many billion 1 cent pieces? Going to take a long time to get some value out of them.
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    [deleted]
- bastawhiz 5y ago
  The overwhelming majority of pennies are not rare, even if they were abolished. There would be many millions (billions?) of coins which aren't really good for much except the material they are made from. Even if you had the time to inspect every penny you planned to melt to see if it was worth something meaningful, the return you'd see would likely not even begin to cover the time you'd spent looking through all those pennies. Unless you had a machine (which costs money) a few hundred dollars is unlikely to make the effort profitable.
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    [deleted]
  - imglorp 5y ago
    About 300 billion were minted up to nowish.
- deleted 5y ago
  [deleted]
- dfxm12 5y ago
  OK. I'll sit on my pennies for a couple centuries until their value raises a couple dollars :) We can look at old, pre-Euro money like pfenning. What are the coins from the 90s worth today? I mean, sure, maybe a few extra bucks, but then you have to factor in some leg work of finding collectors who want what you have. It's not really a worthwhile for most as an investment. The scrap is easy to sell right now.
- grkvlt 5y ago
  taking a page from Carl Barks and Scrooge McDuck, the trick is to collect as many pennies as your can, melt down almost all of them and sell the remaining, now incredibly rare, few for a larger amount of money. see [0] for further details, including pitfalls of retaining only a single coin and the joys of pie fights. for reference (spoilers, but the story is from 1954, so...) the outcome of hoarding and destroying [dubious, discuss] all but one 1916 US quarter was to raise the price to one skyrillion [conversation to SI prefix uncertain] dollars, resulting in failure to realise the cash value of said asset. but, pie fight. 0. https://en.m.wikipedia.org/wiki/The_Secret_of_Atlantis https://en.m.wikipedia.org/wiki/The_Secret_of_Atlantis
- usefulcat 5y ago
  I think you may be greatly underestimating just how many pennies are out there. I used to think bicentennial quarters might be worth more someday. But here we are nearly a half century later and AFAICT a standard (not silver) bicentennial quarter which has been in circulation is still worth pretty much exactly 25 cents. So in real terms, a lot less than in 1976. I guess the lesson is, if you're going to collect coins as an investment, don't bother unless they're either uncirculated or actually rare.
sokoloff 5y ago
I think there's good reason to believe that. The relevant Treasury rule: https://www.federalregister.gov/documents/2007/04/16/E7-7088/prohibition-on-the-exportation-melting-or-treatment-of-5-cent-and-one-cent-coins https://www.federalregister.gov/documents/2007/04/16/E7-7088... as that rule specifically cites: "This rule's purpose is to ensure that sufficient quantities of 5-cent and one-cent coins remain in circulation to meet the needs of the United States." and "It is anticipated that this regulation will be a temporary measure that will be rescinded once actions are taken, or conditions change, to abate concerns that sufficient quantities of 5-cent and one-cent coins will remain in circulation to meet the needs of the United States." If the penny were abolished as a coin, the "sufficient quantity needed to remain in circulation" would become zero. It still seems like an incredible waste of time and attention, but I have my own hobbies as well.
bombcar 5y ago
The anti-melt laws are to protect against: 1. Government spends 1.2 cents to buy metal for a penny. 2. Government makes a penny and sells it to you for a cent. 3. You melt it and sell the metal back to the market for 1.2 cents Rinse, lather, repeat.
- ac29 5y ago
  Some math: Lets say you can get pennies 1000kg at a time. That's 400,000 pennies (@2.5g/ea), or $4000 raw material and a theoretical maximum profit of $800. This is assuming that someone is willing to buy your refined metal at full market value (so it needs to be relatively pure, not backyard crucible grade). I'm guessing to turn a profit on the needed equipment, labor, and other costs of running the operation, you'd probably need to be doing at least 10,000kg/day or something. Seems implausible - you'd never get the supply.

by bloak 5y ago

dheera 5y ago

Why would you melt them down? If they abolish pennies their collector value would probably be much more than 2 cents. Pennies from the 19th century can be worth several dollars, a few specific ones even several hundred dollars.

iso1631 5y ago
If there's only a few then perhaps. There are how many billion 1 cent pieces? Going to take a long time to get some value out of them.
- deleted 5y ago
  [deleted]
bastawhiz 5y ago
The overwhelming majority of pennies are not rare, even if they were abolished. There would be many millions (billions?) of coins which aren't really good for much except the material they are made from. Even if you had the time to inspect every penny you planned to melt to see if it was worth something meaningful, the return you'd see would likely not even begin to cover the time you'd spent looking through all those pennies. Unless you had a machine (which costs money) a few hundred dollars is unlikely to make the effort profitable.
- deleted 5y ago
  [deleted]
- imglorp 5y ago
  About 300 billion were minted up to nowish.
deleted 5y ago
[deleted]
dfxm12 5y ago
OK. I'll sit on my pennies for a couple centuries until their value raises a couple dollars :) We can look at old, pre-Euro money like pfenning. What are the coins from the 90s worth today? I mean, sure, maybe a few extra bucks, but then you have to factor in some leg work of finding collectors who want what you have. It's not really a worthwhile for most as an investment. The scrap is easy to sell right now.
grkvlt 5y ago
taking a page from Carl Barks and Scrooge McDuck, the trick is to collect as many pennies as your can, melt down almost all of them and sell the remaining, now incredibly rare, few for a larger amount of money. see [0] for further details, including pitfalls of retaining only a single coin and the joys of pie fights. for reference (spoilers, but the story is from 1954, so...) the outcome of hoarding and destroying [dubious, discuss] all but one 1916 US quarter was to raise the price to one skyrillion [conversation to SI prefix uncertain] dollars, resulting in failure to realise the cash value of said asset. but, pie fight. 0. https://en.m.wikipedia.org/wiki/The_Secret_of_Atlantis https://en.m.wikipedia.org/wiki/The_Secret_of_Atlantis
usefulcat 5y ago
I think you may be greatly underestimating just how many pennies are out there. I used to think bicentennial quarters might be worth more someday. But here we are nearly a half century later and AFAICT a standard (not silver) bicentennial quarter which has been in circulation is still worth pretty much exactly 25 cents. So in real terms, a lot less than in 1976. I guess the lesson is, if you're going to collect coins as an investment, don't bother unless they're either uncirculated or actually rare.

sokoloff 5y ago

I think there's good reason to believe that. The relevant Treasury rule: https://www.federalregister.gov/documents/2007/04/16/E7-7088/prohibition-on-the-exportation-melting-or-treatment-of-5-cent-and-one-cent-coins https://www.federalregister.gov/documents/2007/04/16/E7-7088... as that rule specifically cites: "This rule's purpose is to ensure that sufficient quantities of 5-cent and one-cent coins remain in circulation to meet the needs of the United States." and "It is anticipated that this regulation will be a temporary measure that will be rescinded once actions are taken, or conditions change, to abate concerns that sufficient quantities of 5-cent and one-cent coins will remain in circulation to meet the needs of the United States." If the penny were abolished as a coin, the "sufficient quantity needed to remain in circulation" would become zero. It still seems like an incredible waste of time and attention, but I have my own hobbies as well.

bombcar 5y ago

The anti-melt laws are to protect against: 1. Government spends 1.2 cents to buy metal for a penny. 2. Government makes a penny and sells it to you for a cent. 3. You melt it and sell the metal back to the market for 1.2 cents Rinse, lather, repeat.

ac29 5y ago
Some math: Lets say you can get pennies 1000kg at a time. That's 400,000 pennies (@2.5g/ea), or $4000 raw material and a theoretical maximum profit of $800. This is assuming that someone is willing to buy your refined metal at full market value (so it needs to be relatively pure, not backyard crucible grade). I'm guessing to turn a profit on the needed equipment, labor, and other costs of running the operation, you'd probably need to be doing at least 10,000kg/day or something. Seems implausible - you'd never get the supply.