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Penny hoarders hope for the day the penny dies (2014) (npr.org)
67 points by vincent_s 9 days ago | hide | past | favorite | 132 comments

I lived in a fantastically not-awesome apartment in Mexico for awhile, across an alley from a tortilla factory that started squeaking at 5am every morning. Literally, every machine in that factory squeaked. The ladies would line up to buy fresh tortillas around 7am and I'd try to sleep through it.

Anyway, there was a half-finished building across the alley, and on Sundays, the tortilla factory was always quiet, but there was this "ping....ping...ping - BANG - ping..ping..." happening. I never knew what it was.

I should add that the Maras had covered my building in graffiti so it wasn't like I was going to go check out the alley at 7am to find the source of the sound.

Anyway, one day I see some guys in business suits walking on the roof of that unfinished building, and I waived across the alley at them. I said "Hey, could you try to keep the noise down on Sunday morning?" He said "what noise?" I said, "you know, the ping, ping ping BANG noise." So this guy goes "oh shit, Sunday morning is when they're stealing our copper wiring".

That episode has made me think for years that pennies are worth more than 1¢...but there's only so much time in life to hoard useless shit.

> but there's only so much time in life to hoard useless shit

There’s this very strange episode of the original run of the series Amazing Stories starring Mark Hamill in which some sort of gnome whom only he can see follows him around telling him that the most important thing in life is hoarding toys. He spends his life homeless, hauling his toys around in a shopping cart, completely alone in the world. When he’s like 80 years old and literally planning his suicide, a wealthy collector bumps into him on the street and buys his toys and he becomes rich overnight, and the episode ends with old Mark Hamill and old gnome dressed like rich folk, apparently very happy with themselves and giving off an “it was all worth it” vibe.

Even childhood me, who was very into this tv show (the introduction to which featured computer animation!), Steven Spielberg, toys, and Mark Hamill – even that young version of myself could see this was a terrible message.


In reality, more of a prophetic message given what people will pay for the right scarce variants of Star Wars toys. No more dangerous and speculative than cryptocurrency IMO, but with a much longer investment horizon.

The part that's unrealistic IMO is the wealthy collector paying a fair price for the toys when in reality he would go out of his way to convince Mark Hamill that his crap is worthless and he's doing him a favor by giving him a pittance for it.

And the final shot would be a dirty and broken Mark Hamill sobbing uncontrollably as he watches a television in a store window where his collectibles are auctioned off one by one on one of our many shopping channels for far more than he got for them.

A recurring theme on Amazing Stories was the power of imagination best embodied by the episode about the World War II gunner who was also an animator who saved his own life by imagining a set of landing gear cartoon style after they were shot off his bomber. The Mark Hamill episode was yet another example of this theme where he prevailed by the power of his own belief in himself and his imagination.

Or the other collector could have waited until after the first's death, and then taken up the cart cackling with glee at his good fortune.

And there's the Robot Chicken vignette paying homage to this episode right there...

This is awesome. My sister told me about this film/episode like maybe more than 20 years ago. Pre-internet era, so I could not search for it back then. I had even forgotten about it until now. I've never seen the episode but now thanks to you I'll be able to watch it.

Much obliged!

p.s I'm surprised the memory was still in my head considering I probably have not thought about it since my sister told me about it.

How wonderfully ironic :)

Haha I've thought about that episode off and on for years, it's very memorable. I honestly think they didn't have the spine to let it have a really dark ending. The resulting 'moral' is pretty fucked though, yes.

It reminds me of the stories of old where a person has great but humble qualities. To enforce that these qualities are worth their own virtue, the protagonist gets their wishes fulfilled by a deus ex machina

Don't delete your comment about pennies, instead, pivot to nickels. Nickels, which have much higher volume than pennies anyways, are 75% copper and 25% nickel. They're worth slightly more than 5 cents - currently, about 5.8 cents, sometimes more, sometimes less - melted down.

Do know that the Mint is aware that 5.8 is greater than 5, that melting nickels for profit is a crime with a $10k fine, and that you'll probably spend more than that profit margin on energy and equipment for melting. Interestingly, one of their reasons for rejecting alternatives like plated steel coins is that any significant change to the density, dimension, or magnetism will break anti-counterfeiting systems.

There's only so much time in life, but if you want something cool for your shelf, have some rolls of nickels, a few fire bricks, a crucible, some casting sand, and a propane burner you can make yourself an awesome, polished, high-density casting from DIY Monel K400 alloy for less than you can buy that stock from metal suppliers. Just don't sell it for profit and you'll be fine.

I bought $2k worth of nickels back 2006 as nickel metal prices were spiking[1], but the coin was not quite worth over five cents yet. I thought, "This is a great way to invest in the metal as the down side is limited and the upside is not". When the bank asked why I needed so many nickels, I told them that I was doing on internet nickel give-away promotion. That seemed to convince them and I loaded up my truck with a 1/2 ton of nickels the next week.

A few months later the government made it illegal to melt down coins as the price of nickel spiked to $50,000 a ton. Cashed almost all of them back into the bank later but, they charged me about a $100 handling fee. I wasn't going to try and melt them down or go to Mexico to make a few bucks. There was a downside after all and the upside was capped. Never forget that the laws can and often do change when investing.

[1] https://tradingeconomics.com/commodity/nickel

Out of curiosity, where did you intend on selling the nickel? Is there a metal recycler that buys melted down nickel at those prices? Or maybe one of those "we buy gold" places?

There are metal recyclers all over the place that buy scrap metal. Look at any moderately-sized fabricator or tool and die shop for a couple of big dumpsters with the logo of your local recycler, they'll likely have one for ferrous scrap, one for aluminum, and probably a barrel for copper wire. If you have a big project such as replacing aluminum siding or 'scrapping' a trailer, definitely bring it to a metal recycler. Even if you're not a moderately-sized fabricator, it makes some sense to keep a box in the back of the shop for scrap metal, every year or so you can bring in a load of brake rotors, broken tools and auto parts, project cutoffs, electric motors, etc. and get a hundred dollars for your trouble while keeping those perfectly good metals out of the landfill. There's a level at which it transitions from a sensible ecological and financial policy towards an untenable sign of hoarding, undervaluing your time, and/or poverty but you can hopefully recognize when you cross that line.

Be aware that they'll be suspicious and will hopefully call the police if you show up with a few hundred dollars of nearly-new copper pipe or electrical wire that you cut out of an under-construction house, or anything else that looks like it might be stolen. Desperate people try that frequently, if you have the financial ability to post on HN it's not worth it.

In my city, the biggest name is https://padnos.com/, and https://www.grcentraliron.com/ has a nice consumer-facing business, but there are similar industries everywhere.

It's interesting to go down as a consumer and shop for cut-offs, you can get small workbench-sized sheet metal, 8020 in lengths not worth bothering with for a big fabricator but plenty for a DIY project, or bar stock to build something far sturdier than you can make with a 2x4 - all at prices per pound a fraction of what you'd pay at the big box stores.

I was figuring that if the metal value of nickels got high enough then coin dealers or metal recyclers would be set up to take them and possibly even advertise this service. Similar to what happened when silver coins became more valuable than face value. I don't think it was illegal to melt down silver coins and thought nickels would be the same.

I don't believe coinage (in America) is protected. It's supposed to have intrinsic value. It's currency that's protected, and that means folding money.

For anyone else unaware, Maras = gangs: https://en.wikipedia.org/wiki/Mara_(gang)

I liked the story!

American pennies are 97% zink, copper coated, since 1982. The new ones feel like plastic, but copper is just too expensive.

Watch me delete my comment about pennies being special.. hah. I give up. I hope they'll let me keep my playstation when I flee this shithole.

Don't delete your comment, it was pretty neat

> So this guy goes "oh shit, Sunday morning is when they're stealing our copper wiring".

> That episode has made me think for years that pennies are worth more than 1¢

Pennies are mostly made of zinc, not copper.

For the US penny that was a change made in 1982 when the previous 95% Cu penny was on course to be worth more as scrap metal than currency.

Great story!

noduerme says >"...but there's only so much time in life to hoard useless shit."<

Would only that this did not apply to the human brain, which seems capable of storing an infinite amount of useless shit (and incapable of allowing us to edit out the smallest undesired part)!

That's well written little story there. I could picture every bit of it.

> Sunday morning is when they're stealing our copper wiring

Huh... what folks need is a way to rollup their copper wiring and take it with them at the close of business.

I don’t understand why the US seems so incapable of simple action that displaces a very minor special interest.

In Australia we got rid of the one and two cent coins 30 years ago because the buying power of the ten cent piece then was less than one cent piece originally when introduced in the 1960s.

There was no big debate or opposition and no lobbying by coin producers or those who produced the metals. It just happened and basically everyone was happy not to deal with more pointless small change. And people still largely paid with cash too so electronic payment wasn’t as significant as it is today.

It shouldn’t be this hard.

The US military stopped using pennies on most foreign military bases decades ago. So there is at least precedent here.

If there was actually a push to abolish pennies, it would become a partisan/political issue immediately and all rational discourse would evaporate.

If you really want to see the penny go away, do what I do: literally throw them away. I did the math and found that the time, space, and attention needed to deal with them was costing me more than 1 cent per coin.

I estimate that I have thrown away about $10 in pennies over the last few years and don't miss a single one.

> The US military stopped using pennies on most foreign military bases decades ago.

The stores (PX, or whatever your branch calls it) I used in Iraq used cardboard discs for all coins, including quarters. I figured it was to reduce having to ship all that metal out just so Marines could buy dip. But they're already shipping humvees and such, why not some rolls of quarters?

I kept forgetting to bring them whenever I bought something and amassed a big bag of pogs. Eventually I threw them away. That's probably the real reason. All transactions suddenly round up to the dollar!

It's so if the money ever gets captured by the enemy it isn't usable.

> The US military stopped using pennies on most foreign military bases decades ago.

They would also dump unwanted currency on the military, like $2 bills, Susan B Anthony dollars, etc.

Back in the early 90's I worked with an older gentlemen who was a submariner who told a story about $2 bills. Apparently there were some locals at one port who were constantly complaining about the sailors causing a ruckus, etc.. So to show what a valuable presence the U.S. Navy was, they started paying the sailor exclusively in $2 bills, with the thought being that this would show the local businesses what impact the Navy was having on the local economy. Apparently this was somewhat successful.

I’ll trade them. Those are my favorite for messing with gen-z cashiers.

Disneyland used to give 2 dollar bills out as change all the time. It was fun.

I used to always ask for those at the bank, if they had any kicking around in the drawer. It was kind of fun but I didn't usually spend them; I didn't want to be the jerk who made store cashiers try to fit them in their cash drawers.

I used to always keep about 100$ in 2$ bills in my travel bag when I traveled often... it was the emergency cash that I'd -never- use unless I was really screwed and needed cash. (Sorry cash only, credit card machine down... Sorry cash only, etc)

Now I just keep a few 20$ behind my phone case for the same purpose.

When I bought my first car, I was friends with the seller and wanted to prank her a little. So when I gave her the cash, I had the first $20 in $2 bills. I don't do stuff like that any more because of the inconvenience but it was fun at the time.

Additional precedent (although not one that resonates much with the typical American): Ecuador, a place that uses USD as its currency and where pennies are worth a lot more in spending power, does not use pennies. Nickels and above only.

Exactly. The half-cent coin was discontinued in 1857, when it was worth the equivalent of 15 cents today. At this point, not just the penny, but also the nickel and dime should be discontinued (and there should be $1, $2 and $5 coins to replace the paper bills). Everything below the quarter is functionally worthless in normal quantities, and even quarters only serve as laundry tokens.

> and there should be $1, $2 and $5 coins to replace the paper bills

What is the reasoning for wanting $1/2/5 coins instead of paper? Don't most people prefer paper?

IME, one and two Euro/Pound coins are incredibly useful and I much prefer them over paper. It makes it worthwhile to carry change around when I can make small purchases with them, and as a bonus I don't have to dig into my wallet for small bills.

I'm not sold on the idea of a $5 coin yet, though. But I just argued a pretty good case for them, didn't I.

The 500-yen coin seems to work fine in Japan.

No one is interested because we don’t use that much cash to make it an issue. Even most vending machines have machines for cards or NFC payments on cellphone.

The only people still using checks or pennies are more than likely elderly. They vote in droves and will probably strike something like that down.

The U.S mint made 7.5 billion pennies last year. Each of those pennies cost more than a penny to produce. The people asking for pennies to keep being produced is the Zinc lobby. Over 20% of transactions are still cash and using pennies just adds extra inefficiencies to that process while wasting money just making the things.

I don't recall vending machines ever taking pennies in my lifetime to begin with either. They've been that useless and annoying to deal with for that long.

> I don't recall vending machines ever taking pennies in my lifetime to begin with either. They've been that useless and annoying to deal with for that long.

Bus fare boxes often will, although they don't show it on the sticker. I got rid of a ton of pennies when I was riding a bus regularly.

Hahaha! YOU'RE the guy taking five minutes to pay! Cling cling cling cling cling whrrrrrr cling cling cling cling whrrrrrrr cling cling cling..... :)

In my defense, I would usually only do five or ten pennies in one fare, and not on a busy route where it would back things up.

I did use snack machines to turn dimes and nickles into quarters at college though. Insert 25 cents, press coin return, get a quarter. Maybe go to 50 cents, but be sure to not put in enough to buy anything, or you'll have to. Snack machines took all worthwhile coins, but laundry machines were quarters only.

I worked with a guy who I distinctly remember saying:

> You don't know how happy I was when I discovered the ticket machines in the (NYC) Subway took nickels.

I remember a town, not too long ago (5 years?) Hilo I believe, that had parking meters that stated: "Nickel or penny for convenience" For 10 minutes of parking.

But at least you don’t get your info stolen when you park [0]. It’s a nice side-effect of using physical money. Also nice that it’s cheap.

[0] - https://krebsonsecurity.com/2021/04/parkmobile-breach-expose...

The US and Germany are two western countries that have relatively high use of cash, and relative distrust of electronic payments - it's only been in the last decade or so that the US has slowly started moving away from signatures for payment and I'm still regularly asked to do it. That's unheard of in almost all comparable countries. You can also see people paying with literal $100 bills at the supermarket.

Use of $100s is in sharp decline for most retail transactions in most of the US, as is cash in general. Most USians under 30 don't carry any cash at all.

As someone who always pays in cash, this is increasingly inconvenient. There are occasionally shops that won't take cash at all.

Cash can still be found in poor communities, as well as the big cities in NY and CA, as well as Las Vegas. Everywhere else is rapidly going cashless.

Philadelphia has banned cashless stores: https://www.inquirer.com/business/cashless-ban-philadelphia-...

I've noticed some out of towners come in and get surprised at how many businesses are cash only, from humble produce stands to fine dining establishments. With that in mind, there is at least some inertia that people know to expect when they need cash (or at least when to tap MAC).

Not everyone can get a bank account or credit card. So, it's important that stuff like grocery stores, clothing retail, etc. accept cash. This is orthogonal to whether or not we really need pennies though :)

High-end restaurants being cash only? That’s bizarre. I’d never go out to dinner carrying like 200 dollars.

I never go out of my house without my passport and enough cash for a week in a hotel and a brand new laptop.

$200 won't even get you a cab and a new phone after you get mugged for all your cards and mobile.

Philly also banned stores and restaurants from using bulletproof glass. Seems to me they care more about avoiding the appearance of racism than they do about the ability of store owners to protect their employees or property from criminals. Going cash free would effectively eliminate the threat of armed robbery for most stores, while also limiting the ability of employees to steal and reducing expenses related to handling cash, but we can't have nice things because disparate impact or whatever the buzzword of the day is.

I was at a cafe and a homeless dude came in wanting to buy a coke for cash, the barista pointed to the “card only” sign and the guy left without buying. Seems explicitly anti homeless at times.

A small business never having to handle cash would have a non-trivial labor savings. Counting cash drawers in and out, preparing bank deposits, etc takes time that you have to pay for. No cash also means no theft of cash (by employees, generally).

That's true but it's not all savings; if you accept credit cards then you get to pay credit card fees.

Yes, but there used to be elaborate systems for handling cash. Department stores had pneumatic systems that would take deposits of cash and zap it to the strong room. When I first started shopping at Costco #2 they had such a system.

The armored car fees, the bonded employees in the strong room, the extra guards, insurance, etc. weren't cheap. I remember reading an article about how happy businessmen (we're talking the 60's, so men) were to reduce the cash handling part of the business. Can't find it now but they felt the fees were worth it. Of course, they were much lower then.

Totally fair points, good call

I always carry some cash, even if I usually pay with card. many many stores have a minimum purchase to use a card, and most these days no longer accept checks. cash is my only option.

I ran into only one store that had a minimum purchase to use card, and they didn't accept cash or checks at all. I just left the stuff on the counter and walked out.

> The only people still using checks or pennies are more than likely elderly.

And of course almost every single brick-and-mortar business...

I'm still salty that it made my Dick Smith beer-powered radio kit harder to assemble (which used copper and iron for the electrodes).

West Wing has a scene or two about the penny. They say it's because it has Lincoln and IL was in that universe important politically. Is that really the reason? What are the other special interests?

The nickel costs even more than the penny does, relative to its value. Eliminating the penny--and shifting the usage to the nickel even harder--may will not save any money whatsoever.

Maybe we should have stable currency that isn’t worth 10% of its former value after 60 years.

Sadly even before the gold standard was abolished the government found plenty of ways to cause inflation, the problem is the Federal Reserve

Lobbying by cotton and linen/secure paper mills (and their congressmen, like Ted Kennedy) are the reason why the USA has had 3 different dollar coins in the modern era but can't eliminate the paper dollar bill.

REF: https://books.google.com/books?id=TXD0DwAAQBAJ&lpg=PA4&ots=d...

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.)

I think there's good reason to believe that. The relevant Treasury rule: 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.

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.

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.

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.

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.

About 300 billion were minted up to nowish.

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.

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

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.

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.

In my ideal world, we'd get rid of pennies, nickels, and quarters, and go to dimes and 50¢ pieces, only. And maybe dollar coins, I dunno.

I'd also be open to getting rid of everything but quarters. There's damn near nothing you can buy for under 25¢—hell, it's getting hard to find much under a dollar, with tax—and that's just gonna get worse every year. Rip the band-aid off and make the quarter the new lowest denomination.

Online inflation calculator tells me a penny in 1913 is the equivalent of 27¢ today, so, yeah, let's go with the second option, actually. It's simpler. Quarters and maybe dollar coins, get rid of the rest. If we start working on it now, quarters might still be worth picking up off the ground by the time the policy's in effect.

would have to upgrade a whole hell of a lot of laundry machines if got rid of quarter!

$.5 only is too big imho would have impacts on low earners and families that buy a lot of food.

No, I proposed either quarters-only, or dimes + fifty-cent pieces.

[EDIT: That is, I agree with you that just 50¢ pieces would be too large a minimum-coin-size]

Dimes are currently worth the equivalent of sub-penny coins in past decades (~40% of a 1913 penny), like the half-penny, and since those were useful then I can see the argument for keeping them around. Nickels and pennies are just useless. IMO by the time we got around to getting rid of dimes, if we started now, they'd also be useless, so I'd also be open to just going straight to quarters-only.

A fiancee who will sit with you sorting pennies? That's true love.

We probably should have gotten rid of the penny a long time ago. We haven't because of concentrated benefits and diffuse costs, a common problem that plagues the federal government. The zinc and copper lobby are significantly interested in keeping pennies around and most people only pay a small price to keep the penny.

I hope we create a law where any coinage that reaches a certain price threshold (~200% of face value) when being made and distributed must be redesigned or retired. This would solve this issue for any future coins that become nonsensical to mint.

The “copper lobby”, if such a thing were to exist, doesn’t give a shit about pennies because the amount of copper in a modern penny is irrelevant. Penny production could disappear overnight and it wouldn’t even be noticeable in copper supply.

At 30 million pennies produced a day, that’s 4100 pounds of copper a day or 680 metric tons a year. The US mines over a million metric tons a year and it’s not even a top 3 global copper miner.

Pennies ain’t shit in the copper game.

When I say "zinc and copper lobby" I'm referring to Jarden Zinc products, the sole supplier of penny blanks. The penny business means a whole lot to them.


Ok, but why not just say that then? Even “zinc lobby” would have been better.

> The zinc and copper lobby are significantly interested in keeping pennies around and most people only pay a small price to keep the penny.

Do you have a source for this? It kinda sounds like conjecture, because I don't believe for a second that the production of pennies are that significant in the metals market. And as the article mentions, pennies are mainly zinc now, very little copper. Zinc is dirt cheap.

Not the bulk zinc producers, but the manufacturer of the zinc blanks that are turned into pennies. From 5 minutes of searching, it looks like the Jarden Zinc Products (or their astroturfing) is the main lobbying group, as they are the sole supplier of those zinc blanks.


The half cent was eventually abolished in the mid-19th century of the US. I can see the penny fading away as well in the near future in the digital age.

Although, how will transactions paid with cash (ie, a bill of $15.97 paid with $20) be fully resolved? Would the business or the customer be shortchanged by a few pennies?

Even if a business does a thousand of these types of transactions (2-4 cent short changing on their end) they stand to lose $20-40 per month (or gain $20-40 per month if the business short changes the customer).

We got rid of one & two cent coins years ago in Australia.

With card you pay as priced.

With cash it rounds price down if ending in 1&2 and up for 3&4.

For a while people would joke and try and line up costs to benefit themselves, in more extreme cases buy $1.02 items separately type thing and usual the world is falling people but this didn't last long and no-one thinks anything of it a year later.

This kind of thing comes up in deciding how to round floats as well. If you always round up or round down, the errors accumulate linearly.

Floats use round-to-even [1] to prevent this, although even that method accumulates error proportional to sqrt(number of ops).

[1] https://en.wikipedia.org/wiki/Rounding#Round_half_to_even

Korea does exactly this, they got rid of 1 and 5 won coins. every transaction is just rounded to the nearest 10.

if we got rid of the penny, you round to the nearest 5. if the business hates losing that 2 cents, they will increase the price of their product by. 1or 2 cents so they get an extra 2 cents. if the customer hates that their product costs 3 or 4 cents more, they don't buy

For what it’s worth, 10 Korean wons are worth less than a US cent (1 USD is over 1000 KRW).

Canada does it that way too. But credit card / bank card transactions still use pennies cause why not. Hasn’t seem to have been a problem there and I didn’t even notice the last time I was there.

Whatever they lose would be made up for in time saved not counting and dealing with pennies.

I've always been a little curious how eliminating the penny might change the way sales tax is handled. Will everything need to be priced in a way that the total including tax will come out to an even 5 or 10? Some stores I've been to already price things to come out to an even dollar amount with tax, so I'm sure it's not impossible.

Or could we finally start including sales tax in the listed prices of things? That would be really convenient for most consumers (though it would probably be a headache for non-taxable organizations).

Or you just move to a model where sales tax is required to be baked into the price that you see. Then make the items all cost multiples of 5 cents. You can still use single cents for checks, credit, or whatever.

The only industry I can think of that gets left behind is gas stations, and then only if you post-pay in cash (or overpay with cash I guess). And they already tend to give a discount for cash, so I think rounding off to the nearest nickel would be a pretty acceptable outcome.

As a bonus I don't have to constantly explain to the kids why the $10 thing they want actually costs $10.80, or $10.85, or $10.72, or $10.97, or some other amount that differs by state / county / city.

That's kind of where I was going with my second point, just bake it in so you don't have to keep explaining to kids or mentally calculating it in.

In countries that have gotten rid of pennies, totals are simply rounded (down, I think, but it's been a while) for cash payments. Digital transactions are still at their original amount

Could always look up how Canada did it, they stopped in 2013

I wasn't aware of that, thanks for the tip!

I don't understand what's stopping them from just melting them down in their backyard. It's not as if pennies are tracked in any way.

I do believe metal traders have to do some diligence and question suspicious supplies, like large amounts of cabling (cable theft is a real problem, they sometimes come in and cut cables from buildings or railways)

Anyway they should, but in practice they make good money off of things as well so they turn a blind eye.

I live not far from a city in the US where a house that is left vacant for more than a few days WILL get it's copper wiring, copper plumbing, and HVAC units stolen.

So no, scrap dealers do not have to do much (if any) due diligence around here

I just had the copper wire stolen from a new house purchase this week so this hits hard. :(

> I don't understand what's stopping them

Cops. If you melt enough they'll show up and stop you.

How would the cops know?

Craigslist, eBay, johnscheapcopper.com, wherever the hell you're selling the stuff.

Before I left the USA, I would special order stacks of $2 bills by the thousands and use them for tipping (particularly at bars) and to hand them to friends and acquaintances. It's crazy how much more people appreciate being given a $2 bill vs two singles. People save them and keep them as lucky charms. I got the best service when know as the guy who tipped in twos.

If you cost your labour and other inputs at zero. Otherwise you're working for less than minimum wage.

Smelting on solar power? No.. then that KWh is going to cost. Or you're stealing energy.

Or you're paying seigneurage to somebody to do this for you.

Also: calutron silver! Can we measure radioactivity from the silver dollars used to purify U235?

Looks like all US 5-cent pieces minted since 1916 (aka, the buffalo nickel) have almost 6 cents worth of metal in them (75% copper, 25% nickel). Source: https://www.coinflation.com/

With some exceptions, you can go back to 1866.

During WWII, some 5c coins were made out of a nickel-free alloy containing 35% silver to preserve the nickel for war efforts. These are identifiable by a large mintmark over Monticello over the reverse.

Before 1892, the nickel 5c coin was issued alongside a smaller silver "half-dime". It's likely the growth of automated coin acceptance machines (early arcade amusements, slot machines, vending machines) really locked in the base-metal coin's dominance.

Two things are surprising to me.

One is that copper pennies still circulate. I'd have expected most of them to end up in hoards. Gresham's Law (also observed by Maimonides centuries earlier) states that "bad money pushes out good." When a new batch of gold coins is minted with less gold, very quickly only the bad coins circulate. I guess this is a minor violation.

The second thing that surprises me is that the law actually stops the coins from being melted. Isn't someone somewhere willing to commit this hard to detect crime?

Is it legal to sell 100 pennies for more than $1? If so, 99% of these penny hoarders need not break any law. Just sell them onto someone who will.

It is legal to sell 100 pennies for more than a $1. Junk silver is this same concept with a different metal, instead of copper it's silver coins.

If you count in inflation over the years you have those pennies in your closet, this would make barely any sense.

Don't understand why people believe in that besides considering this some sort of an hobby, like collecting other old currencies, stamps, historic cars, and other historic stuff.

Yes you could get lucky and have this one in a million penny, art work, car which was undervalued at first glance. Remember that photograph of Billy the Kid, or so that was sold at a junk yard sale? But you should not count on this as an investment. It is a hobby and you may be the lucky person but 99.9999% will not be that lucky person.

The lottery probably pays better.

If everyone begins melting pre-1982 pennies the day they're abolished, wouldn't the true value-maximizing move be saving them with the intention to sell them as a collector's item down the road?

I'm surprised that this sort of thing isn't part of Coinstar's business. Maybe not the speculative hoarding of copper pennies, but at least collecting older silver coins that are worth substantially more than face value. But apparently Coinstar machines reject silver coins (according to this subreddit where people post what they find in the reject bin of Coinstar machines: https://old.reddit.com/r/CoinstarFinds/)

At the Bay Area farmers' market I go to, no one has used pennies for at least a decade, and most vendors have stopped dealing with anything smaller than a quarter. Granted, these are Bay Area prices, so it might not quite work in other places.

That made me realize something. El Salvador uses the US dollar, but has a minimum wage of $1.50. There are other countries in this situation, too. It might make sense for the US to stop using the penny, but it's still somewhat important in other countries.

I love the text transcript

All 1,2 and 5 eurocent coins are copper-clad steel. Much less worth. I guess EU learned something.

US pennies from 1943 were made of steel, but they went right back to copper the year after. There were also a few in 1943 made of bronze, if you find one of those they'd be worth several hundred thousand dollars.

And then since 1982 they are made of zinc with copper plating.

During this massive coin shortage wouldn't now be the perfect time to remove it?

Then there is the nickel which is still made of 75% copper, 25% nickel.

I am curious if anyone has ever or can ever do a study to see if this would ever encourages inflation or not, or who knows if it would have a deflationary effect even?

At a $15 an hour wage a penny is worth just 2.4 seconds.

Nickel hoarding is where the real money is at.

what's the cost of melting the coins and extracting the copper though? It does not look very profitable

Presumably that is already priced in to the going rate for “scrap metal”, no? Well, these aren’t the most rational people so maybe not.

Far more rational to convince a few people to give you millions of dollars you burn through in 8 months not launching a product no-one wanted leaving a burnt out team, disappointed investors and a dozen second hand Aeron's...

I should have just said it's rude to call people irrational, we are all humans, we are not computers. Also, how could you tell if something was rational or not without knowing the full circumstances.

John Oliver did a segment on pennies… https://youtu.be/_tyszHg96KI

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