The NY Times is reporting that the US Mint has issued a ban on the export and melting of US Coins. The reason? Rising commodity prices, of course. When the metal in a nickel can be sold for $.07, or a penny’s melt weight of copper is approaching $.02, there’s profit to be made.
Instead of trying to do something rational with our monetary policy, of course, the Mint is exploring cheaper metals to use in future coinage. Let the hoarding of copper pennies and Jefferson Nickels begin! They’ll join the old silver quarters and dimes on the endangered species list.
The rate at which the Fed is pumping liquidity into the markets right now will probably mean that dimes or quarters will be the new pennies in a few years. Is it any wonder the stock market is jumping when the Fed dumps another $33 billion (assuming my math is correct) into the banks’ reserves this week?
HT: Urban Survival