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Somnophore
Penny Pincher Member
United Kingdom
161 Posts |
 Posted - 10/18/2008 : 04:08:39
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I'm from the UK i've been Reading about you guys in the USA hoarding copper pennies, ie full copper pennies before they changed the composition.
I get that you look for full copper ones, because at the moment copper prices are marginally above FV for the early coins. But why? You legally can't melt the
for profit, so what's the point, it's not silver which is freely traded at spot and above.
In the UK we have copper coins from before a certain year that are all copper, but I've never heard of anyone bothering to collect them.
Just wondering if you could explain, as I could do it if I wanted here but need to know why I'm doing it.
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jadedragon
Administrator
Canada
3788 Posts |
Posted - 10/18/2008 : 05:05:19
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Good question. The best answer for me is that I am inhearantly frugal - I don't like giving up something for less then its real value. I'm willing to wait for the real value to become available to me. If a coin is really worth double face value, why spend it for face value?
While I am somewhat new to collecting coins for thier intrinsic metal value, there are a lot of US coins circulating in Canada. Many people just spend them again, but I have always saved them up for spending or deposit in the US, picking up the exchange rate differance and saving on exchange rate fees. This is also not a new idea. Back in the late sixties, the Canadian Dollar was worth more then the US dollar. My father helped fund his American education by coin roll hunting for Canadian coins. He would just bring them back home to Canada and by more US dollars with them, picking up tax free profit on the exchange rate.
So why collect copper pennies?
1. Copper prices are down right now, but the copper in a penny was worth over 3 cents at one point.
2. This is not a new idea or restricted to the US. Read this article You must be logged in to see this link. Also google "coins in india" for another example.
3. Melt bans come and go. The current US Mint melt ban restricts the melting and export of US pennies and nickels, but all previous melt bans have been lifted in time (silver coins for example).
4. US regulations do not apply in Canada and vice-versa. US copper pennies are fairly commonly circulating in Canada-nothing stops me from selling them for scrap metal. Similarly, my American friends can scrap Canadian copper all day long.
5. There is a real market like silver. We do trade copper pennies at more then face (even more then melt) just like junk silver. Look in the Buy Sell area, or on US ebay. Follow links from the ebay area here. eBay even added a copper bullion area after this group demanded it.
6. With massive bailouts (government spending out of control) most of us expect serious inflation. Coins that contain a semi-precious metal should hold real value much better then paper or digital money.
7. Some of us enjoy collecting, or at least finding, interesting coins. I just found a 1942 Newfoundland penny for example. I've found many international coins in my hunting. Next time I go to the UK I'll be spending my growing collection of UK pennies, 5 pence etc. found in Canada, again enjoying the exchange rate play.
8. Check out this little thread too: You must be logged in to see this link.
9. If the government recognizes something has extra value, and threatens people against doing it, you might want to look into it. These articles should give you a pause and food for thought: You must be logged in to see this link. You must be logged in to see this link.
No one is likely to make a law against owning coins (how the heck would that work) and no one is going to outlaw selling old coins at a premium to face.
10. You must be logged in to see this link.
11. You must be logged in to see this link.
12. Holding some cash with actual intrinsic value other then what is printed on it might be a good idea. Check out this forward looking comment by a guy in Singapore posted here You must be logged in to see this link. :
In the US, the expanded money supply has been almost completely limited to the amounts of credit created by banks and other lending agencies. The proportion of real currency has been dropping for decades, and its absolute amount has also been stagnant for the last few years.
What this means is, that the ongoing inflationary trend is not "real". It could suddenly reverse itself into a very aggressive deflation. (check) If the cycle of credit is broken, the credit-based part of the money supply could contract very suddenly. (check)
A large amount of defaults can propagate upwards in the chain of lending, (check) decimating the bank accounts of each link without actually reducing a single dollar from the monetary base. (check) We could be witnessing the first steps in such a collapse right now. First it's the home owners, (check) then the hedge funds that own Mortgage Based Securities, (check) then the banks that provide the leverage to those hedge funds. (check)
One can think of it this way: The total amount of US currency in circulation is about the same as the current account deficit (ca. $800 bn). If foreigners stop lending their dollars back to the US economy and start to hold them as cash, they could very soon cause an actual shortage of cash in the US. (soon - and not just in the US, think UK and other countries) Holding dollars in cash would suddenly be a very tempting idea, (I'm liking my pennies and nickels and silver coins better and better) if a massive deflationary trend would show up. This could be started by the ongoing housing deflation. (check, this is happening right now) A deflation expectation would make people even more prone to holding cash, and the cycle would rapidly accelerate out of control. (think this might be happening?)
If the FED responds to this by rapidly printing more cash, an even greater inflationary wave of liquidity would follow when the credit starts to expand again. (printing money... zimbabwe style... coming soon to a FED near you)
The markets are also full of derivatives that are supposed to handle all risks. What happens if major sellers of credit derivatives start to default on their obligations? (check) Does anybody control the amount of risk that these companies can buy? (no...) What happens, when investors have sold their credit risks to a company that has bought more than it can deliver? (AIG, Lehman Bros)
The current proportion of credit to currencies worldwide is very high. This means, that the money supply is not stable. All central banks should start to work towards a steady correction to the excess amounts of credit worldwide, perhaps by steadily increasing the reserve requirement ratios. (they sure never took this advise - and are now racing in the other direction) If credit is allowed to grow without limits, it could suddenly explode by itself, bring ing the whole worldwide banking industry to a collapse. (yup = turn on the news!)
Posted by Reino Ruusu on July 30, 2007 at 09:27 PM SGT
I'm sure others can comment too. |
“The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.” – George Bernard Shaw.
Why Copper Bullion ~~~ Interview with Silver Bullion Producer Market Harmony
Passive Income blog |
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Lemon Thrower
1000+ Penny Miser Member
USA
1588 Posts |
 Posted - 10/18/2008 : 06:11:33
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the difference may be in part due to our currency.
until recently, with copper at USD 3.50/lb, the copper pennies you found were worth 2.5 cents but obviously cost 1.0 cents. recently the pound was worth close to 2 USD, so one of your cents would have been worth 2 U.S. cents compared to a copper value per coin of 2.5 cents per coin. so yeah, there is not much point for you guys because your coins cost more to acquire.
sorting the copper from the zinc pennies makes sense only if you go to bank and buy thousands of pennies.
hoarding copper is useful for the same reasons that hoarding gold is. now, copper is a bit more of an industrial metal so the analogy is not perfect but you get the idea. |
Buying:
Peace/Morgan G+ at $15.00
copper cents at 1.3X
wheat pennies at 3X
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Nickelless
Administrator
USA
5580 Posts |
Posted - 10/18/2008 : 06:18:41
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| I'll also add that nobody is advocating melting copper pennies down, the melt ban notwithstanding. Pre-1982 copper cents are known to have a specific copper content, and if you melt them down, all you have is a blob of metal that you then have to assay to determine the metallic content, which is a fruitless activity. Leaving pennies in their current form makes perfect sense. Having said that, think of the difference between pre-1965 dimes, quarters and half dollars that are 90 percent silver. There is a big demand for these coins because of their inherent metal value--we've all studied the chart on Coinflation.com and know what that's all about. There will likely come a day (assuming a rebound in copper prices) when copper pennies will be more readily accepted as payment than their zinc counterparts because, as we've seen recently in India and Argentina, just to name a couple countries that have been grappling with inflation, when it comes right down to it, people want something that has inherent value. Even though copper (and silver, for that matter) prices are down, such coins are worth hoarding exactly because of their metal content. Don't start getting antsy as metal prices drop and feel a temptation to sell--do a Google search for hyperinflation and fiat currencies, and you'll see that EVERY country that has had a fiat currency system has experienced some form of hyperinflation with their paper currency. Don't worry about the fact that metal prices are down--keep on hoarding, especially if you can find silver and copper coins now that are much cheaper than they had been with regard to their metal content, because knowing as we do that the long-term fate of fiat currencies is their ultimate demise, coins (at least copper pennies and nickels, and older silver coins in the U.S.) will have value long after paper currency is relegated to use as toilet paper. Bottom line, keep on hoarding all the copper coins you can and try to convince others that it's the prudent thing to do as well. |
Visit my new preparedness site: Preparedness.cc/SurvivalPrep.net
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TenBears
1000+ Penny Miser Member
USA
1021 Posts |
Posted - 10/18/2008 : 06:51:26
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| Excellent posts above. Real money is gold, silver and copper. If and when paper currency becomes worthless, gold, silver and copper should still hold their values compared against the goods you want to buy (such as food). To me, a copper hoard is a store of wealth that I hope I never have to use. And, it costs no cash premium to acquire. All it takes is a little time to sort the copper from the zinc or the steel as the case may be. |
"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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TXTim
Penny Hoarding Member
629 Posts |
Posted - 10/18/2008 : 08:19:53
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For the fun of it!
I'm easily amused..... |
Beer is my currency. |
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Somnophore
Penny Pincher Member
United Kingdom
161 Posts |
Posted - 10/18/2008 : 11:14:18
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| thanks for the posts above, it's 1.69 dollars to the pound at the moment, and our pennies are larger than yours, and we have two pence coins that are twice the weight. So I think it should be profitable to save them. I read something on the BBC website ages ago about copper pennies in uk being worth more than FV. I think I'll save my pre 82 coppers now for when copper goes up again. I got £15 worth today and will do some sorting later. Worst case scenario is I've still got them at face value. |
Edited by - Somnophore on 10/18/2008 11:15:35 |
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jadedragon
Administrator
Canada
3788 Posts |
Posted - 10/18/2008 : 12:28:25
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quote:
Originally posted by Somnophore
thanks for the posts above, it's 1.69 dollars to the pound at the moment, and our pennies are larger than yours, and we have two pence coins that are twice the weight. So I think it should be profitable to save them. I read something on the BBC website ages ago about copper pennies in uk being worth more than FV. I think I'll save my pre 82 coppers now for when copper goes up again. I got £15 worth today and will do some sorting later. Worst case scenario is I've still got them at face value.
The math on copper value is contained in one of the links I posted. But for sure UK 1 and 2 pence became worth more then melt about the same time as US and Canadian did (May 2006). So really the only differance is exchange rate fluctuations, and the way world currancies are going now, that changes pretty quickly.
You hit an great point I forgot - worst case is you got them at face and you can spend them at face later.
If copper goes way up (general inflation), the bullion value of your coins goes way up. Cash becomes worth less or worthless.
If copper goes way down (general deflation) your pennies will now buy more of everything. Cash becomes worth more - cash is king.
Hold them long enough and they will become collector items - especially if the low denomination coins are demonitized and withdrawn. Collectors will no longer be able to get them.
Or, the UK Govt may follow Canada's Alloy Recovery Program where the Mint (through some large coin processors) pulls all the older coins they can find to melt down. In Canada there are still plenty of Cu pennies, but it is getting very hard to find Ni quarters, dimes, and nickels. One member reported he has found the proportion of nickel quarters has dropped from 50% to less then 10% just this year.
Be sure and post your percentages to the Buying and Sorting thread - we are all curious, and it makes a good record as the numbers change over time. |
“The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.” – George Bernard Shaw.
Why Copper Bullion ~~~ Interview with Silver Bullion Producer Market Harmony
Passive Income blog |
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Somnophore
Penny Pincher Member
United Kingdom
161 Posts |
Posted - 10/18/2008 : 14:38:58
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| £15 of 1ps and 2ps found £4.35 of pre 1992 copper |
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jadedragon
Administrator
Canada
3788 Posts |
Posted - 10/18/2008 : 16:32:52
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quote:
Originally posted by Somnophore
£15 of 1ps and 2ps found £4.35 of pre 1992 copper
29% Cu is better then most of the Americans are getting, not as good as most Canadians are getting. So that proves that collecting UK Copper works :) |
“The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.” – George Bernard Shaw.
Why Copper Bullion ~~~ Interview with Silver Bullion Producer Market Harmony
Passive Income blog |
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Somnophore
Penny Pincher Member
United Kingdom
161 Posts |
Posted - 10/18/2008 : 17:03:12
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| until I've done a few more won't know proper percentages, I went to 3 diff banks to get them and one of the banks ones were mostly newer ones, it's just hit and miss, we don't get rolls, we get £1 bags of circulated change |
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jadedragon
Administrator
Canada
3788 Posts |
Posted - 10/18/2008 : 19:20:17
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Bags are WAY better then rolls. Half my sorting time is spent opening rolls of pennies, the other half is spent rolling the rejects up again. I'm guessing you can just rebag the rejects for deposit right. Consider picking one bank as your dump bank (maybe where you have to make regular debt payments) and mark your reject bags somehow in case you happen to buy them again elsewhere.
If you want to go automated, I am sure a Ryedale would sort UK pennies with the nickel slide on. I've found enough UK coins to run a proper test on my Ryedale now. I'm guessing you can largely sort pretty fast by the various queen's portrait though like I do in Canada. |
“The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.” – George Bernard Shaw.
Why Copper Bullion ~~~ Interview with Silver Bullion Producer Market Harmony
Passive Income blog |
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Somnophore
Penny Pincher Member
United Kingdom
161 Posts |
Posted - 10/19/2008 : 04:08:18
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so far I've been using a big magnet to sort mine or using queens heads,our new ones are copper played steel so sticks to a magnet so can get the new ones out fairly quick. Yes you can just rebag for deposit. You just hand them in at the counter and they weigh them and can just give you cash or you can deposit If you're an account holder. I'm using my bank as dump bank, and the other 6 banks in my town for buying, they never seem to have that many bags in so will need to just get a few from each, this is better because it avoids ending up getting skunked when one bank has a delivery of mostly new coins from a shop or something.
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NotABigDeal
1000+ Penny Miser Member
USA
3890 Posts |
Posted - 10/19/2008 : 10:59:47
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They do it by weight? Interesting.
Deal |
Live free or die.
Plain and simple.
"If you love wealth more than liberty, the tranquility of servitude better than the animating contest of freedom, depart from us in peace. We ask not your council or your arms. Crouch down and lick the hand that feeds you. May your chains rest lightly upon you and may posterity forget that you were our countrymen."
- Samuel Adams |
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Somnophore
Penny Pincher Member
United Kingdom
161 Posts |
Posted - 10/19/2008 : 11:38:45
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| yes by weight, the copper ones weigh the same as the copper played steel ones because they altered the width of the coin to keep the weights the same. Won't be able to get rid of the new ones until next weekend so will have to do a run then, got Wednesday off next week so will do one then as well. |
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Computer Jones
1000+ Penny Miser Member
USA
1112 Posts |
Posted - 10/20/2008 : 00:17:06
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One of my major dump bank now uses a magnet to run across the roll.
If it sticks they give me the roll back.
I got caught with a 2009 Canuk HRH in a dump roll:(
My my buy bank will take a Canuk penny or two and not bat at an eye.
I'm closer to Canada than Seattle, maybe that's why.
Don't buy CWR's if they have a black line (I use a medium point Sharpie) about 1/2 inch around the end roll, I've searched it.
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There's profit if you melt things!!
8{> |
Edited by - Computer Jones on 10/20/2008 00:19:19 |
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Lemon Thrower
1000+ Penny Miser Member
USA
1588 Posts |
Posted - 10/20/2008 : 05:17:26
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| for those in the U.K., 1982 is the year the U.S. switched from mostly copper to mostly zinc in its pennies. you would have to look up the year for UK pennies - if its the same year that would only be because of a coincidence. coinflation.com might have that information. |
Buying:
Peace/Morgan G+ at $15.00
copper cents at 1.3X
wheat pennies at 3X
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Somnophore
Penny Pincher Member
United Kingdom
161 Posts |
Posted - 10/20/2008 : 06:24:26
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| it's 1992 in the UK also 55% of 1998s are copper due to steel shortage, check with a magnet. |
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can someone explain the point?
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