Billions In Stored Coins? Should Mint Make Major Production Cuts?

I agree jeffbuckes an overnight transition to fractional coins could work really well. I think the way would be this:

Cents and nickels are removed from circulation and recycled. They are no longer legal tender but will be accepted at banks.
Halves are issued for circulation yet again. Quarters stay the same.
Dimes are instantly (and without prior warning) revalued to 12.5 cents i.e. a "bit" and thereafter referred to as such. The term dime could also be repurposed to mean one eighth instead of one tenth instead of changing the design so circulating dimes would still be used.

Please do! I have a previously undisclosed megahoard of dimes.


In all seriousness, going to fractional will do way more harm than good. Let us not do that.

Not even 5 billion dollars worth of Cents over 60+ years is a rounding error for the US budget. That's worth it to keep it. The higher the denomination of the smallest legal tender is the more you condition people to accept rising prices.

The decimal/fractional question is one I have given some thought to over time.
The coinage system we have been accustomed to is a wierd mix of decimal and fractional denominations. Although Ben Franklin proposed, and the country initially envisioned, a purely decimal system, the contemporary coinage in use was largely fractional foreign issues, most notably the Spanish dollar and Spanish fractional coinage. It was not until the second half of the Nineteenth Century, that there were enough U.S. coins in circulation that foreign coins were abolished as legal tender.
The mint started out pursuing purely decimal denominations in 1792-1793. The earliest cents and Half Cents even included the fractions 1/100 and 1/200 which are decimal denominations expressed as fractions. The Half Dime and dime were also clearly decimal denominations.
But then in 1796, the mint issued the first quarters, a purely fractional denomination. From 1804-1836 quarters were labeled as a 25 cent denomination, which is consistent with a decimal expression of value. Then in 1838 the mint began calling the coins quarter dollars.
The half dollar had a similar history. The lettered edge of the first issue said "fifty cents or half a dollar" which was both a decimal and fractional expression of value. Beginning in 1807, the reverse said 50 cents but the edge lettering remained. In 1838, the edge lettering was dropped, and the denomination of value on the reverse was changed from 50 cents to half dollar, a fractional expression which continues today.
Due to the small number of U.S. coins in circulation in the earliest years, the public was locked into use of fractional coinage based on the Spanish dollar. The habit became so ingrained that people often referred to the quarter as "two bits," referring to 2/8 of a Spanish dollar. Also, experiments with other decimal denominations, 2 cent, 3 cent and 20 cent, never achieved lasting public favor.
Today's coins are the cent, nickel and dime which are all decimal, the quarter which is fractional, and until recently, the half dollar which could be treated as either, but which has had a fractional name for almost 200 years.
So that seems to be how we got where we are today: a mixed decimal/fractional system developed through economic necessity due to a shortage of decimal coins in circulation.
Although the existing system is somewhat illogical because it is consistent with neither the fractional nor the decimal approach, in practice it has worked quite well and no one has seriously suggested changing it. Frankly, due to habit and long standing commercial practices, I don't see a change to either a purely fractional or decimal coinage system as any more likely than a switch to the metric system.
Of course, this only applies to circulating coinage. As pointed out, business practices, including stock pricing, have all moved to purely decimal pricing, and there can be no doubt that we have had a decimal economic system throughout modern times. Personally,, I think people will stop using coins altogether before we change from the current publicly accepted mix of fractional and decimal denominations..

We have a low denomination decimal coin, it's called the Dime. Which fits nicely in there between the 12.5 and 6.25 possibilities you mentioned.

The reason we got the quarter dollar was because for over 100 years the only relatively common coinage in circulation were the Spanish dollars and it's fractions (and the Spanish system was based on 1/8ths) So for over 100 years before we started our decimal system the people were used to using quarter dollars. Jefferson recommended a 20 cent coin to fit into the decimal system but the quarter was already too ingrained. I'm not sure what we would have ended up with the British coins had been much much more plentiful. Even so it was NOT easy t get the public to switch to the decimal system. Most businesses still kept their accounts in pounds shillings and pence until around the second decade of the 19th century. What finally got it accepted was when the government enforced use of dollar accounting when dealing with the government in payments and taxes sometime I believe around 1810. Before then if you look at government accounts you will see some in dollars and some (even in mint accounts) in pounds shilling and pence.

I typically get a roll of dollar coins each week from the bank. I use them for small purchases and yard sales, when I don't want to pull out my wallet. Rare is the time someone doesn't appreciate getting those coins from me. Indeed the most common expression I hear is "You sure you want to spend that?". I think there is more demand and interset than most people think.

I also remember that there is a South American country that uses our dollar coins as their national currancy. Where it is very popular!

@Sharkman -

I'm getting slightly off-topic here, but how many Euro coins do you have?

If it's just a few, save them as souvenirs.

But if you really don't want them you can send them to me, I can use them.

You could also sell them to http://www.leftovercurrency.com/exc...s/euro-coins

They're located in London so shipping can be expensive.

@Sharkman -

I understand your frustration. These banks think they're saving money by not accepting your loose change but they're not.

Real life example: I worked in the cash office of a large retailer for many years - we had to buy coins BY THE TON every week. All that coin cost money - we had to pay an armored car company (Brinks) to deliver coin to us. They charged a big fat service fee on top of the face value of the coin. So, believe it or not, we actually preferred when customers paid with change - because we needed the coins anyway, and every time a customer paid with cash and coins it meant a little less we had to order from Brinks...! Yeah, we had to count and store the money, but we had to do that no matter where it came from. So if your bank won't take the US coins please spend them! The clerk might moan (some can't count change sorry to say) but the accountants in the head office will smile.

BTW: I'll buy those euro from you. I won't make you rich, but if you don't want them maybe we can make a deal. Send me an email if you want.