Things you can buy with a penny?

I thought it was a cool post title but does anyone even know anything you can truly buy with a penny? Virgin Mobile says texts but I bet you don’t pay your bill with pennies.

I was watching an old West Wing episode in season four where they talk about eliminating the penny.

Some of the statements they said on there were:

  • That the dollar has depreciated so much in the years that the penny has depreciated to nothing.
  • That Illinois is the only state to take the penny in their tollbooth.
  • That the penny is hardly made of copper anymore because of the cost and is made with Zinc.

The zinc part is true in a letter from Francois Velde at the Chicago fed he states that the zinc has been in since 1983. The cost to make the penny is more than a penny. This from Reuters:

“Pennies are copper-coated zinc, and due to a recent run-up in the prices of those metals — with zinc up to about $1.49 cents a pound from about 50 cents in 2000 — the penny now costs 1.4 cents to make, according to the United States Mint.”

And it costs the U.S. quite a bit.

“Producing and handling pennies costs the United States about $900 million a year, according to Wake Forest University professor Robert M. Whaples, whose research Kolbe cites.”

Will American’s oppose it? The article continues:

“Americans will surely protest attempts to kill the penny, which has earned a hallowed place in popular culture. The humble coin, minted since 1793, has inspired everything from old-fashioned penny candy to the famed 1936 Bing Crosby movie “Pennies from Heaven,” expressions such as “a penny for your thoughts” and Benjamin Franklin’s famous maxim that “a penny saved is a penny earned.”

On the Illinois thing, Wikipedia says that it does take penny but that is unclear because its Wikipedia and they could have been watching the same show I was. It make sense Lincoln is from Illinois. There are discussion online of people throwing a handful of pennies in the machines and getting back the extras in nickels.

In that letter by Velde from the Chicago Fed states that pennies are worth 6% less than their face value, while pre-1982 it was worth 72% more than its face value.

So pretty soon it will be better off to take all your pennies and melt them, obviously we aren’t there yet (with opportunity costs) but we are getting there.

Velde continues that the other countries have found steel cheaper to use something for their small denomination, which we did during World War II.

So anyways it take congressional action to change the composition of the penny and well we need it.

When the time this letter was writing they were making stricter regulations to melting the penny and nickel.

Sounds like an economical crime…..

I meant minting the penny at all.


Published in: on December 13, 2007 at 5:49 am  Comments (2)  
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2 CommentsLeave a comment

  1. […] My old post on pennies here. […]

  2. i like eating pennies

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