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 Replies: 29 / Views: 13,787 |
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Valued Member
United States
477 Posts |
Hi, I have some extra money sitting around and what to do something with it. Going to the bank and investing in coins for face value sounds like a good idea because it's a risk free investment. If I go and get a box of 25 dollar pennies, that box will always be worth $25 (unless they discontinue the penny). In this sense investing in coins and coin roll hunting seems like a secure investment. People are hoarding copper pennies. I don't completely understand why. The melt value of a penny is like 3 cents or something. So the metal of the coin is worth more than the coin. It is however illegal to melt us currency. I guess people are betting that the law will be changed or that they discontinue the coin as tender. I guess it's very possible that we may discontinue the penny (Canada did) over any other coin, but I hear that it's very unlikely due to high support from the public for the coin. I don't see them changing the law any time soon. If I'm not mistaken the law was created to prevent people from melting the coins and gaining more money than what the penny is worth. Why would they change this law? I guess some people are predicting a crash in the U.S. (just the economy crashes isn't enough, the legal system will still prevent people from melting the coin). If the U.S. did crash wouldn't people be more concerned with finding food, shelter, and clothing and not a bunch of copper coins? Moreover how would you transport a giant hoard of coins to another country or another location if you couldn't afford gas for your car and had to move to another country and had to transport some other means. I've heard people who have like a metric ton of copper pennies. How would you transport that much if the country crashed. Having a metric ton of copper pennies sitting around in your home may be a good idea, but couldn't you put that money in your bank account and make money off interest? With interest being 0.02% simply putting your money in a bank account doesn't counter inflation by any means. People make basically nothing. Maybe a metric ton of copper pennies will be worth a lot in 100 years. But wouldn't any coin (for the most part) that is over 100 years old be worth more than it's face value by a lot? I've seen like 200 dollars of Indian head pennies on ebay sell for thousands of dollars. Being that copper is a very useful metal and used in many things, wouldn't there always be a stable market for copper? If copper shouts up to like 10 dollars a pound we would be completely screwed. The electronics market would crash along with the bullet industry. If they change the law and allow people to melt their coins or they do indeed discontinue the currency, wouldn't the melt value go down because people would be melting giant hoards of tons and tons of copper? It would be a supply and demand thing, were there is a huge supply of copper. I just don't understand why people are hoarding copper pennies. It's different then gold and silver coins. Copper is a very useful metal and there needs to be a stable economy for it. I've heard that nickles are 75% copper and I don't see the U.S. discontinue the nickle any time soon, or the penny for that matter. Can someone please explain why it's a good idea to hoard tons of pennies? Thanks. |
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Valued Member
 United States
477 Posts |
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Pillar of the Community
United States
917 Posts |
I believe that is what happens when the coin gets rolled to many times.
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Valued Member
United States
477 Posts |
what exactly is this though I'm not exactly sure it just looks weird
rolling the coins to many times will make this happen? Why?
What exactly am I looking at hear lol. It just looks off.
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Pillar of the Community
United States
863 Posts |
well putting money in the bank is not really worth it at the moment. interest rates are so low you do not get much return. if you are saving pennies it is able to sell them on auction sites for their melt value. it is pretty common on ebay. |
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Valued Member
United States
477 Posts |
so at this point it's better to invest in material things than just leaving your money in a bank. I understand. Certainly if interest was the same in 1911 and you put in your bank account 25 dollars of pennies, that 25 dollars would be worth more today if they were the original 25 dollars of pennies rather than the 25 dollars accumulating interest in the bank. Makes sense. Coins are safe to invest in because they will always be at least their face value. A robber is most likely not going to steal a metric ton of pennies from your home. I guess there's always the risk of a fire or flood burning your material things you collect in your home, but I would assume that a bank is roughly the same chances of such things from happening, and a bank is insured for those things. And pennies allow you to accumulate a lot because they cost a penny.
So then why not keep the zinc pennies as well? If people are just stashing away copper pennies for a hundred years and cashing in on the profit wouldn't all those zinc pennies that are a hundred years old be worth a lot as well?
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Pillar of the Community
United States
1150 Posts |
That Lincoln Cent looks like a Misaligned die or Machine Doubling. Kinda neat but not really something that would add much value. The US is not going to do away with the cent or nickel. We will however most likely change composition to steel. I believe that once composition is changed it will be legal to melt down the former copper cents. With the way the Euro is breaking apart, and the eventual fall of the dollar (maybe not in my lifetime but it will happen), I'd rather have my money in tangible assets than fiat dollars. Copper, silver, gold, bullets, guns and most importantly food, etc.., are all tangible assets. Anything is better than dollars. |
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Valued Member
United States
162 Posts |
You've already answered the question of why people are hoarding - they are betting that the ban on melting will be lifted, probably when the penny is discontinued.
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New Member
United States
15 Posts |
If you sell copper pennies on ebay do you roll them back up or just put them in a plastic bag and put it in a flat rate box? I've got about 50lb that I've pulled out while roll hunting pennies and want to get rid of them and get more then face value. |
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Valued Member
United States
458 Posts |
Im pretty sure it doesn't matter, as long as they get there safely. ^
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Pillar of the Community
United States
863 Posts |
Yea it shouldn't matter.stick them in a bad. Your selling circulated pennies not numismatic coins
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Valued Member
United States
52 Posts |
Gresham's law is that bad money drives good money out of circulation. Since copper pennies are worth more than zinc pennies in metal value, copper pennies will be hoarded out of circulation and zinc pennies will be used as currency. Same thing happened with gold coins and silver coins. If zinc prices rise in value from their metal value and the penny becomes made of something else (steel?), then same thing will happen to zinc pennies being hoarded like you mentioned. I agree it is different than gold and silver because copper is not a precious metal but a base metal and much much cheaper. Wonder if copper pennies are like the "you won't miss it until you can't get them at the bank anymore" kind of thing? ...Kind of makes things interesting about it doesn't it? Here's an article on it you can find searching google about investing in copper bullion and their view on why copper pennies are the way to go: http://coincollectingenterprises.co...pper-bullion |
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Bedrock of the Community
United States
19949 Posts |
I definately wouldn't "invest" in copper cents. However, I do think a small hoard is prudent....just in case those doom's day people are right. LOL The problem with investing in copper is the logistical nightmare it creates. Look at the link posted above, yada yada yada about "investing" in cents, then they go on to trying to sell you pounds of cents. If they're so awesome, why are they selling them by the ton?  I'll tell you, because he's created a logistic nightmare for himself hoarding this many coins. I bet he's barely breaking even if you consider all the hassle involed. If you want to invest money, do it properly and not with some weird scheme with coins, Iraqi dinars or other such non-sense. In the end, you'll be MUCH better off IMO. There's a reason people stick with mostly traditional methods.....they work. Lincoln Cent Lover!VERDI-CARE™ INVENTOR https://verdi.care/
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Pillar of the Community
United States
2120 Posts |
I always beware when someone tells my why I should do something, and provides the means to enable me at the same time.
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Valued Member
United States
477 Posts |
ok well I do see one day the penny getting discontinued. I don't think it's really arguable and that one day (not saying when) it will get discontinued just like the Half Cent. I agree that investing in copper pennies sounds "iffy". I've read that the Obama administration is considering changing the composition of the penny and the nickel because it costs more than a penny to make a penny and more than a nickel to make a nickel. They may just discontinue the penny altogether, nobody knows. Quarters are supposedly 91.67% copper (they are also larger in diameter than the penny), dimes are also 91.67% copper, half dollars are 91.67% copper as well, the dollar coin is 88.5% copper. With that being said.... I believe copper coins is very different from the history of silver in coins. Silver was largely removed from commons US coins, although I guess the nickel still contains a small amount of silver. I guess No more silver nickles, dimes, quartets, half dollars are minted. This makes silver coins more rare. If they do however change the composition of the penny and nickel to contain even less copper, quartets and dimes will still contain a large amount of copper. Billions of copper coins will still be in circulation and minted. This is why I don't see copper pennies being worth more to collectors, like silver dimes etc., because there will still be copper coins in circulation. Hence I'm still a tad bit confused why people are hoarding copper pennies. I get that people will buy them for the value of copper and not one cent a piece resulting in profits, or maybe they will change the law and you can melt them, but at the moment I don't see this happening. I only see them changing the law once there's a copper shortage, but they will change the composition of other the coins before this happens, and right now we are only considering changing the composition of the penny and nickel. I understand that it's best to invest in something that is safe (your pennies will always be worth one cent so you don't loose any money) and that it's better to invest in material things instead of letting your money sitting in a bank collecting interest at a incredibly low rate. $25 dollars in pennies taken out of circulation for 100 years will be worth more to collectors than the nothing you earned off of putting 25 dollars in a bank account. Maybe pennies are worth hoarding because I do believe that one day the coin will be discontinued (weather that will be several decades or a 100 years, it's bound to happen). Bottom line I still don't see why people are hoarding 20k of copper pennies really when quaters, dimes, half dollars, dollars, contain a large amount of copper and were not considering changing their compositions, but do see it being a good idea in the sense that one day the cent will be discontinued. IDK I guess I'm not seeing something but those are my thoughts and I don't know much. Edited by greenprint
05/29/2012 02:58 am
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Pillar of the Community
United States
622 Posts |
greenprint, I have maybe $100 in copper cents. Mostly just because I wanted to separate them while role searching cents. So I'm not a big investor in cents or anything. Matter of fact...I'll probably just sell on ebay. You keep mentioning you understand investing in 'material things versus the bank'. I believe the aspect you're missing on this is it isn't just a material thing. Copper cents are worth more than twice their face value to be melted AND they can be used as currency. That's different than just investing in material things. You may not forsee the legalization of melting cents but others see that as a real probability...and with good reason. If you still don't get it, give me some kind of material thing that you feel should be hoarded exclusively above cents, and I'll give you the argument for copper cents. Doesn't mean I believe my argument but I at least understand "why" people are hoarding them. OO |
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Replies: 29 / Views: 13,787 |
Posted 05/25/2012 12:58 am
