Why Nickels Will Be Debased: A Graphical Illustration

One thing being assumed is that "melting nickels" denotes creating a pure material in the end. There are many industrial users for CuNi alloys which would not require refinement, just tweaking the alloy. This would only require melting, not refining, thereby having the value closer to intrinsic as a raw material. Heck, look up prices of CuNi washers.....it is cheaper to drill a hole in a nickel than to buy the washer....lol same goes for quarters and halves!

@wquinn - Nah, you're looking at production cost, not intrinsic value. It takes 11-12 cents to manufacture each one, including metal, labor and transport. As jbuck and captainfwiffo pointed out in their responses, even if the metal was free, the production cost would be higher than the face value... As for the clad vs. silver quarter you're absolutely correct. In that case ... well I was lazy. :-)

@unholyroller - Good point! Hehe using them as washers would be like burning Deutschmark notes post WW2 for heat.

Yeah I believe it is a matter of when and NOT if the composition change happens. My guess is the year 2013. I was not alive when the silver coins were debased and subsequently hoarded (I was born in 1985) so it will be interesting to see how things turn out.

I love the nickel but I think we will soon see the end of minting the US coins intended for circulation since we all know that there will never be a silver and gold nickel and copper standard in coinage in the future. After a while there won't be any coinage and currency at all.
Just plastic cards.
I bet that soon enough people will whip out their cell phone and use that to make transactions at the speedy checkout lane with those by linking to an account in some way.
Remember when you would go to the Supermarket and go through the express line with cash only and less than 7 items? Now it's hardly and express lane since every body has to root trough for a card and swipe it and enter info in the pad. Each UPC has to be scanned and half have to be manually entered by the "cashier". If they use cash, the "cashier" can barely do the math.

This is interesting. I have heard things about nickels, but I never really thought about it. This got me thinking, thanks for the image.

Not a bad idea tex.

The main reason why I said those costs, is that is what it really costs. Like others have said, even if the metals were free, it would still cost above face value to make the cent and nickel, so I don't see why just the cost of the metal means anything? It really should be total cost.

And I hope Conder isn't right that it takes them another 5 years to make a decision. It shows that hundreds of millions of dollars in losses isn't that big of a deal to them.

But as this gets discussed more and more, I totally agree now that it is time to stop minting the cent at the very least. There are billions of cents floating around businesses/banks and stored in people's homes, so there are more than enough to circulate for a few years. Yeah, people will hoard them and once we run out, then we don't have any to use, unless people cash them in. So be it.

The choice will be to hoard them or to spend them and let the people decide if they really want to use them. If they circulate, then obviously people want to use them.

It would be an interesting experiment for the Mint to try, while they are deciding on what to do. And after a year or so, then do the same for the nickel. I think it would be too much of a shocker to the general public to stop minting both in the same year.

Much better than waiting 5 years to do something!

I forget the country, but remember reading decades ago of a country with holed coins they used for roofing washers.