My friend proposed an idea in which the federal government would seize all pennies, melt them down, and sell the metal to private sector buyers for a profit. As of 2009, the amount of new pennies (those made of 97.5% zinc and 2.5% copper) in circulation was 1.65 trillion. The melt value of these pennies is $4,129,473,259,612.45. Therefore, is it a good idea for the United States government to sell the metal in exchange for US dollars?
Pennies are only good for not getting more pennies in cash transactions. Other than that, I don't see a use for them. It's one of the reasons why I hardly use cash. Plus, it cost more to make a penny than what it is worth, as do nickels. Another good reason to get rid of pennies. The total cost to produce and distribute a penny in 2010 was 1.79 cents, according to the U.S. Mints most recent annual report. A nickel cost the government 9.22 cents. Overall, the U.S. Mint lost $42.6 million on the more than 3.48 billion pennies and 359 million nickels produced and distributed in fiscal year 2010. http://www.politifact.com/new-jerse...rothman-says-it-costs-more-make-penny-and-ni/
I have a hard time believe that there are 1.65 trillion pennies in circulation. That is about 5,500 pennies for every person in the US.
Not all those pennies are necessarily held by the public, but simply out there. It would be much harder for the US Treasury (the source I used) to determine how many pennies every individual held. However, the profitability is there. http://www.coinflation.com/coins/basemetal_calc.php
Well, I'm not in much of a position to challenge the Treasury on it. But it seems pretty bizarre to think there are an average of 15,000 pennies per family out there.
