The E-Sylum:  Volume 11, Number 14, April 6, 2008, Article 27

REBUTTAL: COUNTERPOINT: STEEL CENTS COULD WORK

Responding to Jeff Kelley's comments on his piece about Steel
Cents, Dick Johnson writes: "Each of the three points you brought
up in the counterpoint in favor of steel cents last week have
already been refuted. Your points concern: (1) copper plated
zinc and steel cents circulating side-by-side, (2) rounding
off to nearest 5 cents, and (3) penny vending machines.

"When two coins of unequal value circulate side-by-side, the
lesser value will always drive out the dearer value. If you
suggest a steel cent valued at one cent would circulate with
a copper coated zinc cent valued at slightly more than one
cent Gresham's Law comes into play. If you think not, then
why didn't the silver-manganese wartime nickels stay in
circulation for a couple of years longer than they did (when
their value was only one or two cents more).

"Rounding off has proved successful whenever it has been
tried. For every apocryphal story you could relate, even from
overseas, I could match it with another. Not every merchant
will always round up. I like the story of the Israeli drug
chain that advertised it would only round down. It won a
marketing advantage over their competitors for only a few
cents per purchase. Great point to advertise, which they did.

"As for penny vending machines:  Show me one.  Few if any
are active today. It is not cost effective to stock and
retrieve cent coins from such a vending machine.  Further,
vending machines do not reject foreign coins and slugs by
magnetism.  It is done by surface resistivity of acceptable
alloy coins.  But thank you for writing, Jeff. Please do
write again."

 DICK JOHNSON: STEEL CENTS WON'T WORK!
 esylum_v11n11a20.html

 COUNTERPOINT: STEEL CENTS COULD WORK
 esylum_v11n12a14.html

  Wayne Homren, Editor

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