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500% Inflation because of Canadian Penny's elimination??

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The Canadian 1 cent coin was eliminated in early February 2013. It cost more to produce than it was worth. But while the government's choice was probably wise in some senses, they might not have considered the enormous inflation that they have engendered. 500% isn't peanuts!...

 

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Also, as with in other countries that have eliminated their lowest denomination coin, smart retailers round down since the good pr is worth much more than a few cents.

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And the only items that would've suffered 500% inflation were those that already cost only a penny, and 1c items are very likely to be bought in bulk, not one at a time -- the cost for 20 is going to be 20c, not $1. Also, to go from $1.99 to $2 is inflation of only 0.5%; from $19.99 to $20 is 0.005%. Also, electronic transactions are still carried out to the penny; only cash transactions are affected. So realistically, an inflationary effect that can be ignored.

 

That said, I'd rather we alter the content of the Lincoln cent than eliminate it -- or even the structure; I don't object to a penny with a hole in the middle. Yes, I know all the arguments for getting rid of it, and I'll even admit that they're good arguments. I still don't want to see it go.

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The romanian leu is weaker than the dollar and I reckon than the 1 ban coin (100 ban = 1 leu) is for sure more costly to produce that it actually is worth. However nobody proposed the elimination of this useless coin - it is about 0.3 cents so you can't really but anything. And it is quite ugly, too.

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Our economy runs on a fiat monetary system. Therefore, inflation rises artificially based on the creation of money. With the elimination of the Canadian cent, inflation is certain to happen. That inflation is dependent upon how many more larger denominated coins are made to meet the new economic demands. The more coins that are minted, the more the fiat money becomes devalued, and thus the inflation. Although it may not be noticeable in the short-term, continued devaluation of the Candian currency will have definite long-term inflationary effects.

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There are countries that have taken their lowest denomination coins - cents, pennies, etc. I don't see a problem. The cents get rounded up or down AFTER the bill is added up. If you see that you are going to lose 2 cents because of the rounding, you can pay exact using your card. New Zealand just got rid of their 5 cents - not much of a drama either. I can guarantee 500% is definitely an exaggeration and want to see the maths behind it.

 

Whinging about inflation isn't going to help either - might as well find a job that pays you better.

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With the elimination of the Canadian cent, inflation is certain to happen. That inflation is dependent upon how many more larger denominated coins are made to meet the new economic demands.

 

Why would there be a need for more coins? The penny was just an inconvenience, it was not really being used for transactions anymore, it was long past its use by date.

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