President Donald Trump says he has ordered the US Mint to stop making pennies, which he correctly says cost more than one cent to produce.
“For far too long the United States has minted pennies which literally cost us more than 2 cents. This is so wasteful!” he said in a post on his Truth Social platform. “Let’s rip the waste out of our great nations budget, even if it’s a penny at a time.”
Go ahead, keep going up the line until no change is left. For those who don’t want a central bank digital currency, by agreeing to this, you’re doing their work for them. God forbid after Trump is gone they’ll eliminate paper money citing what he’s doing now. They’ll justify it by saying printing paper money is bad for the environment, or some shit like that.
ReplyDeleteBe careful what you wish for.
Nah. This is just a consequence of inflation over time. When I was in college, I could live on five bucks a week. That paid for all my food, fun, and incidentals. Gas was 25 cents a gallon. The average family made $9800 a year. A new Volkswagen cost $2000. A penny simply isn't worth anything. One cent in 1960 was the equivalent of a dime tody. One cent in 1970 was the equivalent of 8 cents today. Trump should get rid of pennies *and* nickels.
DeleteEven with "normal" inflation, over time a given denomination of money loses its value. There are a couple of options. The first is to start over and put out "new dollars" or whatever. You force everybody to turn in their money and replace it with a new version that's nominally x times the original. So, we could make "new pennies" for "new dollars" and replace them at 10:1. The second is to just let inflation happen, start printing high denomination bills again, and put out coins that reflect that, e.g. start putting out more dollar coins and start making 10 dollar coins. The third is to start this process incrementally by removing worthless coins.
I noticed this when I went to the Netherlands 40 years ago. I remember exchanging my dollars for guilders. The exchange was some odd number and I was owed X guilders and some odd number of pennies. They gave me the amount rounded down to the nearest five penny piece. I objected, since I didn't know that nobody actually counted pennies in the Netherlands, and a penny meant something to me. The clerk looked around and finally found someone who had a few individual pennies -- but they all thought I was nuts for insisting on correct change. As I stayed there I learned that everybody rounded to the nearest five cents for everything. It was no big deal.
“Normal” inflation is simply the purposeful devaluation of a currency.
Delete"Normal" inflation is also a mechanism of deflating .gov debt. 'Course .gov just keeps adding to the debt by stealing from the treasury, as DOGE has revealed over the last week or so. So, once DOGE ferrets out all of the theft, maybe the country can get back to more sound method of budgeting and controlling expenditures.
DeleteOne of the worst fiscal crimes ever committed in this country was the Federal Reserve.
"Permit me to issue and control the money of a nation, and I care not who makes its laws."
Lord Rothschild
Nemo
Yeah, they also print $100.00 bills which cost them $0.075 each. The profit is called "Seigniorage". They can afford to lose money on the damned pennies.
ReplyDeleteNo, pretty sure Seigniorage is what they call it when you bring them gold and they make it into coins, which are more valuable, but they keep some of the metal themselves.
Delete$100 bills costing $0.075 to make is fraud and/or theft, nothing to do with honest money.
John G.
The problem lies with the Federal Reserve and their systematic destruction of the purchasing power of the dollar. Unless THAT is addressed by abolition of the Fed, restoration of a sound currency backed by precious metals, or the restoration of market money with ZERO government involvement other than the prosecution of fraud. With addressing the root causes, we will all eventually be burning dollars to stay warm like they did in Weimar Germany in the 30s.
ReplyDeleteThe Federal Reserve is an evil organization. It is not enough to abolish the organization, one must destroy the people running it.
DeleteJust punch a hole in those pennies and sell them as "dry weather washers" and you'll make millions.
ReplyDeleteNope, never heard of ionic galvanizing or any such sort.
When I first heard this, I immediately thought they're preparing you for a reverse split.
ReplyDeleteThere's no historical evidence to support fiat currency. And it always . . ends up the same for the currency. A wheelbarrow full of cash for a loaf of bread. Those pterodactyls have yet to come home to roost.
Paper money isn't. It's just an IOU from the feral reserve aka the world monitary fund.
ReplyDeletePennies last forever. Cheap at 2 cents.
ReplyDeleteNo!! They are made to self destruct. The ones after 1982 are zinc and only last five years or so if dropped on dirt
DeleteI save all of my nickels since they are the only coin still worth a nickel. I also save all pre-82 cents, and check my 82's by cutting the edge. Zinc cents quickly corrode, so moving them to four or eight year intervals might be a better idea than ending them.
ReplyDelete-arc
Most military bases overseas don't use pennies either. Haven't since I was stationed in Germany back in the 1980's. Prices were rounded to the next 5-cents and no one had a problem with it.
ReplyDeleteMore and more people are paying with cards and smartphones, actual coins are going to be used less and less. None of my kids carry coins, let alone paper money anymore.
Several years ago, nickel was at its highest price ever. Kyle Bass bought $1MM of nickels from the Dallas Fed, sold those to a Mexican client who melted them down.
ReplyDeleteMr Bass received a cut of the profit, which think was around $50K. All legal, as he didn't do the melt.