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History shows that when coins are worth melting, they disappear


akdrv
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Talk about pennies from heaven.

 

A potential shortage of coins in the United States could mean all those pennies in your piggy bank could be worth five times their current value soon, says an economist at the Federal Reserve Bank of Chicago.

 

Sharply rising prices of metals such as copper and nickel have meant the face value of pennies and nickels are worth less than the material that they are made of, increasing the risk that speculators could melt the coins and sell them for a profit.

 

http://news.yahoo.com/s/nm/20070122/us_nm/...ies_shortage_dc

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well, I imagine that you need a huge amount of pennies or nickels to melt in order to make a nice profit. And I am sure that not a normal person would do such things! I think that is more a global paranoia this melting problem of the coins! Silver coins may be melted in order to make some jewels, but nickel.. hey.. who buys 100grams of nickel??? :ninja:

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Even if you had a 3.14 tons of copper cents (a shade over 1,000,000 cents) is only $10,000. The energy needed to melt them down and transport the metal to the buyer would more than consume whatever profit is involved.

 

Umm, I don't think so. If your logic held true then recyclers and scrap dealers wouldn't be buying scrap copper (wire, plumbing pipe, etc) or aluminum or steel or anything else for that matter. Fact is, it's far more efficient to tranport and remelt scrap than it is to mine ore and refine it.

 

At the current price around $2.00/lb for dirty scrap (that's the category for cents since they contain zinc), that 3.14 tons of cents is worth about $12,500. At last year's copper high, it was worth around $16,000.

 

People were melting cents by including them with other scrap. That's why the gov't passed the new law about melting cents and nickels (nickel has also risen in price). They will be melted eventually just like the silver was.

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