The E-Sylum:  Volume 9, Number 17, April 23, 2006, Article 17

NEW YORK TIMES COVERS THE MINT's CENT QUANDARY

As Dick Johnson previously reported in The E-Sylum, the U.S. Mint
is having a problem with cent production due to increases in
commodity prices.  The lowely one-cent coin currently cost the
mint 1.4 cents each to produce.  On April 22 The New York Times
covered the story.  Here are a couple excerpts from the article:

"What happens if a penny is worth more than 1 cent?

That is an issue the United States Mint could soon face if the
price of metals keeps rising. Already it costs the mint well more
than a cent to make a penny.

This week the cost of the metals in a penny rose above 0.8 cents,
more than twice the value of last fall. Because the government
spends at least another six-tenths of a cent — above and beyond
the cost of the metal — to make each penny, it will lose nearly
half a cent on each new one it mints.

The real problem could come if metals prices rise so high that
it would be economical to melt down pennies for the metals they
contain."

"Asked if the mint had a backup plan for what it will do if zinc
prices rise far enough that it could pay to melt down pennies,
a spokesman said that such issues were for Congress to decide."

"Pennies, meanwhile, are in high demand. Last year, the mint made
7.7 billion of them — more than the number of all the other coins
it produced. In the first three months of this year, the pace of
penny production rose to an annual rate of 9 billion — the highest
since 2001."

To read the complete article, see: Full Story

  Wayne Homren, Editor

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