A Glimpse Into The Future.

As a non-completionist, I have observed that completeness seems to drive a lot of collector Mint purchases. Some folks tuck away the sets, and others fill Dansco pages or airtites. It seemed to me that the Mint did a disservice with the profusion of finishes (SMS, matte, proof, reverse proof) and then again with the profusion of State Quarters, ATB Quarters, American Women Quarters, Presidential dollars, and Native American history dollars. I have said this before, but it reminds me very much of comic book collecting in the late 1980s, with a never ending stream of series, crossovers, collectors editions, special covers, limited series, and so forth. Eventually you just feel drained and unable to keep up. This new auction format reminds me very much of 1990s-present comics issues where 1% of a run has a special cover, and the big money collectors fight over those. It's artificially manufacturing rarity to create a super-elite product that has much higher perceived collector desirability and therefore long term monetary value (right or wrong as that perception may be). But frankly, it stinks for casual collectors and even more for dedicated collectors who don't have the financial means to frequently spend serious money on their hobby.

I am waiting with great concern to see the 2026 slate announcement. I have a great love for the bicentennials, and if the Mint really gouges collectors with multi-tier semisesquicentennial products, I am going to be disappointed.

I think COVID generated a huge bubble in bullion sales. The subsequent years have also generated massive inflation and national debt, so it might not be fair to compare 2020+ to 2000-2018.



I will preface this by saying that I am a staunch capitalist.

The government is not a business. The Mint is a service to the Treasury, and the Treasury is a service to government and the taxpayers. If that service is delivered to taxpayers at an approximately break-even price, I would call that a win. Most government services delivered to taxpayers are furnished at partial or total loss of the input capital.

If the collectibles division of the Mint were indeed a business, it would be run astronomically more efficiently than it is. All the expensive facility locations would be closed. Most of the expensive unionized and non-union workers would be dispatched. Possibly the input materials and proof coin manufacture would be moved to low cost areas or even overseas.

Bluntly, you cannot have taxpayers provide massive subsidies to an inefficient government entity, only to have that government entity pretend that it is a business that must make profit by gouging taxpayers as customers. We pay for the service with tax money, and we should receive the service at-cost. The striking of proof coins is an exercise of national pride. We lose money on pretty much all other exercises of national pride—monuments, parades, museums, parks, and so forth—so it strikes me as unnecessary to single out a function that is breaking even.

Regarding silver and gold bullion specifically, the Mint's job is to provide a secure, verifiable, stable bullion product to meet U.S. banking, government, and private demand. If it breaks even in the process of providing that service, I would call that a win.

From the perspective of a non-modern collector: Of course they're jacking up the price. They're collector items, solely made for collectors. It's no different from any other producer of collector goods such as comics or baseball cards (assuming these are still around).

From a financial perspective: The mint needs to recoup losses, and raising prices is one way to do that. A quick glance at their FY24 AR shows circulating coinage revs declining from $1.169B in 2020 to $0.553B in 2024. NI decreased from $609M to $182M over the same timeframe.

It can be argued that the mint isn't a business, but that simply doesn't reflect reality in today's world, regardless of whether or not we agree with it or like it. Perhaps one viable alternative would be to raise the federal tax rate by a few percent across the board, but I imagine we'd do that for the USPS long before the US Mint.

And yes, as a medieval collector, it's easy to be "objective" when it doesn't impact me (Just don't get me started on import tariffs from Europe )

U.S. circulating coin production in 2024 was down 80% (!) from peak production in 2000.
I don't know if any significant amount of equipment has been de-commissioned since 2000, but that sounds like an awful lot of idle capacity looking for new business.

Probably this same scenario is playing out all over the world.

I don't think the data exists for 25 years to answer that.
However, there is data saying that the number of cash transactions per U.S. consumer has been constant for the last 5 years.
https://www.frbservices.org/news/fe...ital-economy

I'd like to go back to the title of the thread, "A Glimpse Into the Future," and start with a backward look before looking ahead (maybe an oversimplification, but here goes).
1. For its first century the mint was largely focused on providing cons for consumers and businesses to use in every day transactions (and for the first half of that century, they were constantly struggling to keep up with need for coin). No commemoratives or other specialties.
2. That changed in 1892, with the Columbian Expostion coins, followed by another 48 silver and half dozen gold commemorative coins struck over about a 60 year period.
3. Then, nothing for 25 years, which happened to be the years when I began collecting. So, my memory was that there was exactly one option for a "U.S. Mint collector issue:" a proof set.
4. In the mid-1980s the modern era kicked in, and the mint began producing more collector offerings than ever before.

So, what's the point?
Just that the mint's inclination to cater to collectors has waxed and waned through several cycles previously, and what's going on now is just another phase.

As for that glimpse into the future ...
1. We know that no more 1 cent coins are going to be produced, so some of that $85 million in red ink (I would guess around half) will be eliminated, making the Circulating Coins part of the mints portfolio look a bit better (remember that part was already the most "profitable" part).
2. However, since the 1 cent coin is 50% of production in a typical year, it means that one of the mints should be closed, probably Denver. Yeah, I just wrote that to see if anyone is paying attention, but I would be shocked if it weren't already being discussed. To do anything else would be throwing away taxpayer money with the volume of circulation coin production where it is these days.
3. I like brandmeister's idea that profit margins should be almost zilch. They are already at only 1.5 - 2% on bullion products, but were at 8.5% on numismatic products in 2024. If the profit on numismatic products were to go down to 1.5% (and I can also think of reasons why that's a bad idea), you are only going to pay 7% less, which I don;t think solves the problem posted by the OP.
BUT ... If there is plenty of additional "profit" (seignorage) being generated from killing the peny and closing a mint, why not use it to subsidize production of the numismatic products ? As pointed out by brandmeister, there is no reason any one part of the mint's product line needs to be profitable as long as the whole operation runs in the black.

The exercise of determining which site gets closed needs to take a number of factors into account, like you say.
I only said Denver because, from the viewpoint of circulating coin production, it looks like they more or less are a duplicate of Philly, and if coin demand remains where it has been the last two years, just one of those sites can fulfill the entire national demand for circulating coin production, with lots of room to spare. It's the definition of "redundant," though you'd need to look at the downside on distribution cost in comparison to the recurring fixed cost savings of closing a facility (though I think we can make an educated guess on that).

Moving equipment is very expensive and disruptive. You have to count on the time to de-commission the equipment in the current location, move it, then re-commission in the destination location. The larger the equipment, the more you want to avoid that, and I think the the equipment for striking large coins and proofs is the largest (higher striking tonnage). The reason closing Denver looks like a no brainer to me is that you might get away without moving much equipment.
Though, as they say, the devil is in the details.

On the distribution cost question ... The Mint shows that the average distribution cost for nickels, dmes and quarters in the current production/distribution model is 0.001 cent per coin. If we consider a hypothetical Denver production of 2.5 billion coins evenly split between 5, 10 and 25 cent coins (more than what was actually produced in ether 2024 or 2025), and say that their distribution cost would double if the coins were made in Philly, we get a whopping $25,000 dollar increase in distribution cost. If that's a underestimate and the costs would triple, that brings us up to $50,000.
Closing a site like Denver would probably save upwards of $50,000,000 per year, though a need to add another shift on some of the Philly equipment might cut into that a bit.

(Can you tell I've done something like this? )