In Canada we have already "graduated" to this position (although we still have the nickel). I have not sure that pure logic will win the day when it comes to changing the currency, though.
When to question of rounding comes up, I always say that rounding down will be common since the vendor does not have to pay electronic surcharges on cash transactions. Also, anyone rounding up will only be under-cut by their competitors who will round down (take care of your customers or someone else will).
The first video (which should be viewed before commenting) mentions something else I had not considered, that is the cost of paying employees to handle pennies. The time saved by just rounding down will probably add up.
Rounding hurts the poor. Those coins honor Abraham Lincoln. Some employees wouldn't like having to round everything to the nearest nickel. They help keep prices low. etc.
Plus, there are many things you can do with pennies like:
Donate them to things like to charity, churches, salvation army, healthcare, etc. Throw them in wishing fountains. Use them in some toll roads like Illinois toll roads. Use them in some transit buses. (depending on location) Use them in stamp machines at a post office. Use them in self-checkout lanes. Teach a little kid how to count. Cash them in or trade them for coins and cash at the bank. Use them in a coinstar machine. Scratch a lottery ticket. Use as bingo chips. Use them as lunch money at school with other coins. (I have also used 5 pennies with other coins at school for lunch money before, too. And a few other places as well.) To pay the exact change. Use them in some toy gumball machines. etc.
I also think the one dollar bill should stay, because most vending machines accept them. Some people also don't like carrying too many coins at a time. George Washington is also our first President.
Here in Canada we're thinking about getting rid of the nickel and quarter and bringing back the 20 cent piece and the 50 cent piece. We were also thinking about a 5 dollar coin until the new polymer bills came out
In Canada we have rounding to the nearest nickel, and it is rounded up as often as it is rounded down. The net cost over the year is as near to zero as matters.
With gas pumps you can deliberately put in xx.02 worth of gas and it only costs xx.00. So with a weekly fillup, your net gain for gas would be $1.00, on a total cost of $1000s. Somehow it seems that even if someone could accrue a tiny benefit from each transaction, it is such a trivial amount, I really don't know why people make such a fuss about it.
Rounding hurts the poor. Those coins honor Abraham Lincoln. Some employees wouldn't like having to round everything to the nearest nickel. They help keep prices low. etc.
Someone did not watch the videos first. All of those reasons are explained away.
When you consider that a dime today would buy what a penny did in the 60's, a dollar would buy what a dime did then etc. one wonders why we need small coins like the penny and nickel.
Rounding does not hurt anyone, we all do it all the time anyway. Ever buy exactly a gallon of gas? How did you get that tenth of a cent?
The US could eliminate the penny, nickel and quarter and use dimes and resized halves and dollar coins and after a year or so no one would notice the difference.
How about a more radical solution? Devalue the dollar by a 10 to 1 margin. Now the cent is worth what a dime was yesterday. Gas will be less than a quarter a gallon, one could by a gallon of milk, a loaf of bread and a jar of peanut butter with a dollar bill and get change back. We could be right back to the days of Ike and JFK, as least as far as the purchasing value of the dollar is concerned...
Quote: The US could eliminate the penny, nickel and quarter and use dimes and resized halves and dollar coins and after a year or so no one would notice the difference.
Quote: The US could eliminate the penny, nickel and quarter and use dimes and resized halves and dollar coins and after a year or so no one would notice the difference.
I'm in for that. I might even throw in 20¢ and $2 coins as additional options.
Quote: How about a more radical solution? Devalue the dollar by a 10 to 1 margin.
In today's digital economy, that would be a really tough sell and incredibly hard to coordinate and implement. I worked for a major brokerage firm in the late 90s when stock prices went decimal (instead of pricing by 1/8 per share). That was hardly a trivial effort and there was a firm timeline that had to be met. It should come as no surprise that if anything went wrong with that effort, someone stood to lose a lot of money and it would not have been pretty. Now multiply that potential loss by ten and factor in legal fees for the inevitable lawsuits. That would scare anyone away from attempting such a change, and when everything is eventually digital anyway, devaluing isn't going to mean as much as it does with tangible currencies.
Any real change is never going to happen, with the possible exception of a Canada-like elimination of the penny. Digital money will take over before they can make any substantial change to the coinage.
The next real change to currency will be its elimination.
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Posted 11/29/2016 3:37 pm
