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longhorn
Penny Sorter Member
80 Posts |
 Posted - 05/18/2008 : 10:09:49
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There has been a lot of discussion about how long copper pennies will remain in circulation, and comparison with how rapidly silver disappeared. The melt premium for copper pennines is much higher than the melt premium for silver was in 1965. There are several people who seem to think there will be a rapid disappearnce of copper soon. Even though silver disappeared rapidly, I don't think its likely to happen quickly with copper.
I was 12 in 65, and at least to children, a quarter was of significant value. Most vending machines sold candy bars for a nickle until about that time, then the price doubled to a dime. You could buy a burger at the local cafe for about 40 cents, in short change had value, not just something that weights down your pockets, as most people view it today. Many young people today carry almost no traditional money, relying instead on debit cards.
According to the goverment issued cpi it takes $6.82 to buy what $1.00 would get in 65. I believe that the government has done a wonderful job of shaveing a couple of points per year off the real rate of inflation for the past ten or fifteen years. It saves us all money we would be paying to retires, and works to reduce our interest cost on the national debt. Its also dishonest but most politicians don't worry to much about that. Actual inflation is more likely around 10 to 1 so again that change just isn't worth much.
Today there is an abundance of investment alternatives available. You can buy small amounts of stock, precious metals, ETF's foriegn currency etc easily. While many altenative were out there in 65 they were nowhere near as accessable. But, you could save your silver coinage and there were lots of dealers who you could buy, sell or trade with. As highlighted by the recent "retail silver shortage" the inventory or silver for trade has gotten smaller and concentrated in fewer hands.
Silver has been considered precious metal, a store of value, and a medium of exchange for eons. While copper and nickel have value they haven't been viewed in the same way by most people. It is also difficult to store enough copper or nickel to make a difference should the shtf. For instance if had had $10,000 to invest in metal as a store of value, that would get about a troy pound of gold, about 50 troy of silver, and 2500 lbs of copper.
If the melt ban is lifted, there's an oil embargo, dollar value drops like a rock, or some other paradigm shift, copper and nickle will go fast. And these are uncertain times. But without something dramatic I think we will continue to see a slow decline.
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JerrySpringer
Penny Hoarding Member
669 Posts |
Posted - 05/18/2008 : 10:56:10
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Your points are valid. Others here have been collecting for years possibly. They may have some minor doubts of return on investment. At least we are in good company. I am looking at this all as a psychological hedge at least. I feel like I have to do something in these low interest rate days. The only thing I am getting screwed on possibly is my time and labor to collect the copper. I may never see any $$ gains on the face value of the pennies and nickels I have collected. That in itself would not be the end of the world. I miss out on 2% annual interest by not putting my money in a bank CD. Even if I had $10,000 in copper pennies, that would be about 60 cents per a day. Not a huge insurance cost there to have an asset that may be easy to sell for 2x face value if things heat up and people start seeing metals as worth holding. So there you go. I know it is crazy to think that the SHTF. We have been OK so far, but one thing I think obvious but sort of ignored is that the USA standard of living is very high and kept that way based upon things we are not so sure could not be tested or gamed like they have been in the recessionary years. I was a kid during the Reagan era and did not notice the 1990's early recession either. I pay more attention now to costs than I ever have. I also spend more money because I have more, but I see some interesting times coming up and I am not sure if my fears are worth writing off as paranoia or as a boy who sees the emperor has no clothes. I'd prefer to trust the system and think costs will be manageable vis a vis inflation, but I have a gut feeling that nobody says life has to be fair to savers or the believers of banks wanting to help people.
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HoardCopperByTheTon
Administrator
USA
6807 Posts |
Posted - 05/18/2008 : 11:59:11
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Excellent post longhorn! I was a few years younger than you in 65 but I still remember going through my mother's change to see if there were more men dimes or lady dimes and scraping up my allowance to swap for all the lady dimes. The abundance of silver certainly dropped off quickly as people became aware. I agree with you that the copper cents will take longer to disappear, even though the percentage gain is significantly higher. Most folks just don't want to make the effort. There have been published stories that many folks will not even bend over to pick up a pile of pennies. It was a lot easier to sort out the silver from the clad coins. Without the proper machinery it takes folks way too long to sort the copper out from the zinc.
Even projecting a much slower disappearance of copper than silver, there will still never be a better time to sort than the present. The other thing to consider is that if they switch to a steel penny it would be easy for the government to retire all the old pennies for their benefit using sorting equipment employing large electromagnets.  |
If your percentages are low.. just sort more. If your percentages are high.. just sort more.
Now selling Copper pennies. 1.6x plus shipping. Limited amounts available. |
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TenBears
1000+ Penny Miser Member
USA
1021 Posts |
Posted - 05/18/2008 : 17:20:10
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| I don't think copper pennies will be taken out of circulation very fast. With silver in 65, it was easy. People understood silver and that it had value. The vast majority of citizens kept their silver change. Even with the lifting of a melt ban, or the introduction of a steel penny, I don't think people will be sifting through their pennies to find the coppers. So many people are just ignorant of the content of pennies, and even if you do save a copper, it's only worth 2 cents at a smelter. Not hardly worth the trouble to save em just so you can buy an extra piece of bubble gum. Perhaps I am an optimist in this regard, but I think we will have our extremely small fraternity of copper hoarders for a number of years yet. I think the only real threat to our hobby is the lifting of the melt ban and then some large commercial operations get going harvesting copper out of the monetary system. By then, maybe I will have at least one ton of pennies. I may never sell any. I plan to keep many bags of copper pennies to give to my grandchildren, should the Lord ever bless me with any. Also, I think a store of copper is a good hedge against many SHTF scenarios. Who knows?, if things are really bad, someone may trade you a cow or a horse for a $50 bag of copper pennies. |
"Rich," the Old Man said dreamily, "is not baying after what you can't have. Rich is having the time to do what you want to do. Rich is a little whiskey to drink and some food to eat and a roof over your head and a fish pole and a boat and a gun and a dollar for a box of shells. Rich is not owing any money to anybody, and not spending what you haven't got." Robert Ruark
there are too wild Indians...
there are too wild Indians...
there are too wild Indians...-----still taunted
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Ant
Penny Hoarding Member
USA
894 Posts |
Posted - 05/18/2008 : 17:59:48
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quote:
Originally posted by texcattlerancher
Who knows?, if things are really bad, someone may trade you a cow or a horse for a $50 bag of copper pennies.
That day is not too far off, at least around here. I was at a sale yesterday and nice sound riding horses, not fancy ones, but nice, were going for $400. Very few horses were put up with a reserve, either. Hay is still reasonable around here, but with the price of gas and food going up, something's got to give. The people who are taking their horses to the sale were either on a shoestring budget to begin with, or are looking to get rid of the extra ones. |
Lovely dimes, the liveliest coin, the one that really jingles. --Truman Capote
Coins are the metallic footprints of the history of nations. --William H. Woodin |
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Art Tatum
Penny Collector Member
USA
400 Posts |
Posted - 05/19/2008 : 21:01:54
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| I am going to amp up to $5000 a week rather than the tiny puny $1500 a week I have been sorting! |
my machine is running! |
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fb101
Administrator
USA
2856 Posts |
Posted - 05/20/2008 : 11:32:05
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| Me too! I am going to amp up to $50 a week rather than the tiny puny $25 a week I have been sorting! |
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Ant
Penny Hoarding Member
USA
894 Posts |
Posted - 05/20/2008 : 17:10:30
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quote:
Originally posted by fb101
Me too! I am going to amp up to $50 a week rather than the tiny puny $25 a week I have been sorting!
Ha ha! ROCK ON, fb!!!  |
Lovely dimes, the liveliest coin, the one that really jingles. --Truman Capote
Coins are the metallic footprints of the history of nations. --William H. Woodin |
Edited by - Ant on 05/20/2008 17:11:00 |
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1965 vs 2008
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