The $1 billion in Dollar coins that no one in the United States wants

[cbdo2007]

Budget cuts thanks to the stalled economy have imperiled care for the mentally ill, left a new school building unstaffed, and perhaps most disastrously, limited efforts to keep nukes out of the hands of terrorists. And yet the Federal Reserve Bank of Richmond is sitting on $1 billion in gold dollar coins it says the American public has little interest in using.

Two reporters from NPR's Planet Money visited the facility where the coins are kept, in Baltimore, Md., and offer up a report about the stash of funds that the American public doesn't care for, Meanwhile, even as the coins gather dust, American taxpayers are paying top dollar (as it were) to store the surplus--and even to increase it.

The surplus of dollar coins is due in part to 2005 legislation introduced by then-Delaware GOP Rep. Mike Castle. In an effort to get the American public to adopt the coinage, Castle's bill mandated that the U.S. Mint produce coins commemorating every U.S. president (we're currently up to number 18, Ulysses S. Grant). In order to win broader support for the measure, Castle also agreed that 20 percent of the coins minted under the new bill would still feature the coin's previous figurehead, famed Native American figure Sacagawea.

And while casting money isn't the same as having it around to fund programs, switching Americans over to dollar coins has been sold as a money saving strategy--coins have a longer shelf life than bills, and according to a 2011 GAO report, converting to coins would save the government $5.5 billion over the next 30 years. However, that profit margin is largely made up of the difference between how much the coins cost to manufacture and the price at which they are then sold to the public, NPR notes--and the Federal Reserve has largely dismissed the case for dollar coins as a net gain for the government, noting that these kind of savings are not likely to translate into benefits to the larger economy.

http://news.yahoo.com/blogs/lookout/1-billion-no-one-united-states-wants-194115156.html

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Why are they still making these if no one wants them?

[joeybee12]

1. Give them ALL to me...i want them! nt

[WillParkinson]

3. Coins or...

Can't have both.

(Well, I suppose with a billion dollars maybe you CAN.)

[joeybee12]

20. I CAN have both!

And i will...someday!

[Mojorabbit]

2. If they are made of gold they are worth about 1500 bucks

even if they say one dollar on them. I'd be glad to take a boatload of them off their hands at a buck apiece.

[Historic NY]

4. me two I'll help the gubermint out with a few bags.

speaking of money did they ever fix the printing blunders on the new $100 dollar bills.

http://www.sodahead.com/united-states/the-100bn-blunder-fed-forced-to-quarantine-one-billion-100-bills-after-printing-error-makes-the/question-1374425/

[Ruby the Liberal]

6. Beat me to it. Gold is about $1500 an oz these days.

Must have been a typo.

[Throckmorton]

8. Gold Colored

Just copper clad inside.

In order for the $1 coins to circulated, the $1 bill must go.

[Capitalocracy]

41. Seriously, everyone would be gathering them up and melting them down

Not the case.

But if they want to cut down on storage cost, I'd be happy to take some off their hands anyway.

[Art_from_Ark]

46. They aren't anywhere near being made of gold

They're made of a funky copper-nickel-manganese-zinc alloy. The only time the US minted dollar coins made of real gold was from 1849-1889 for regular issues, in the form of commemoratives a couple times after that.

[w4rma]

5. The coins will be in demand after inflation really kicks in. (nt)

[KansDem]

7. Who doesn't want them?

I've used these coins from time to time and I don't see where the gripe is. I like using them rather than having my wallet stuffed with paper one-dollar bills.

The "We've got them but no one wants them" bullshit is horseshit!

[Kurmudgeon]

9. I don't want them, a wallet stuffed with coins is much heavier and bulkier than one with bills.

[KansDem]

10. You put your coins in your wallet? I put them in my pocket...

..along with my nickles, dimes, and quarters.

[Kurmudgeon]

11. Who patches your pockets for you? Ever figured out how much money you've lost?

[KansDem]

13. Oh, I've lost money!

Just not out of my pockets! :rofl:

Look, release the dollar coins. Then I can use them and you don't have to. Deal?

[Kurmudgeon]

25. Never had a hole in your pocket? Cool! Can't release the coins though, not up to me, sorry.

[xmas74]

36. Do people not carry coin purses or

carriers anymore? You can find them pocketsize.

If they don't make them anymore someone on here could make a decent living off making them. Heck, I could make one right now with scraps around my house for almost nothing.

[itsrobert]

14. And they scratch my smartphone

No thanks.

[KansDem]

22. No problem!

Use paper dollars, and I'll use dollar coins. Deal?

[Thav]

31. Agreed, I spent time in europe

and they didn't have bills until 10 Marks (germany, over 10 years ago). Up until then it was 1, 2, 5 mark coins. It was nice to not have to worry about bills, and was kinda fun to pay for a dinner out with four coins - something you can only dream of doing here.

Paper bills are kind of annoying, since you have to stuff them in your wallet along with, generally, 3 feet of receipts because retailers insist on giving you surveys, coupons, and heartfelt thanks in the form of longform prose on your receipt.

Besides, Americans are used to throwing their spare change in jars, imagine the savings rate!

[Blue_Tires]

34. Agreed...I loved using the Euro coins, too

[Daemonaquila]

12. The claim that "nobody wants them" is nonsense.

Whoever wrote this story wasn't doing their homework, and wanted to sell the idea that nobody wants to use dollar coins without doing research about why they aren't in broader circulation.

Have you ever tried getting a dollar coin? Short of going into a bank and buying a roll of dollar coins, you might as well not bother. There was one postage machine in the government center I worked near that gave them out as change. I've seen some machines in Vegas that use them. I've found a handful of machines (usually automated parking, which in themselves are rare) that take larger bills that spit the dollar coins out as change. I love them. So do a lot of people I know. We just don't think it's worth going to the bank to buy them.

If they want to get the coins out into circulation, they need to get them into the hands of grocery stores, subway card vending machines, and other mass-market situations. That has its own problems, of course, since a lot of machines aren't built to take the coins or give them out as change. Stores aren't switching over because it's easier to do what they've always done. But the government could do a hell of a lot more to get the coins out into the public's hands. We'd use them.

[Scout]

16. the vending machines where my husband works accept dollar coins

and will give them as change for a $5.

i like the dollar coins and would use them a lot if i had them.

[former9thward]

18. They are not hard to get.

Go to any bank and they will give you as much as you give them paper.

[Scout]

23. oh god, thank you so much! i never would have been able to figure that out

all by my own little self

:eyes:

[former9thward]

39. It seems you needed the help.

You would use them if you had them so is it so hard to go to the nearest bank?

[tabbycat31]

28. I used to work in a bank

We never had dollar coins by the roll period. We only had them in our drawers if a customer would bring them to us. If you came to us wanting all our dollar coins, we would love you to take them off our hands.

I used to have a customer that routinely asked for our "junk" (every employee was female so keep your mind out of the gutter) when he cashed his paycheck.

[SnakeEyes]

48. having worked retail for years in the past.

There has been efforts made. You try giving coins to people and they ask for bills. And many people who do take the coins end up keeping them as like a souvenier so they are removed from circulation.

[damntexdem]

15. Hey, I'll take them. When can they begin shipments?

;-)

[geardaddy]

17. They must be polling men who go to strip clubs.

[cbdo2007]

38. Did you see in the comments section....

someone commented,

"These coins are really a pain in the butt at the strip club (pun intended)"

hahahahaha

[PATRICK]

19. The USPS stamp machines

were one of the sole big vendors giving gold coins as change. I believe most if not all of them are gone, replaced by ATM kiosks. Probably plastic has diminished the influence of cash advantages of any sort.

[tabbycat31]

29. Add the MTA (metro NY transit) machines

I would hate it when I had an $11 ticket and put in a $20 and would get 9 dollar coins.

[Iggo]

21. I want them. I want them all. (n/t)

[kick-ass-bob]

24. As soon as they are given out as change, we will use them.

Where does one get most of their singles? A bank? No. ATM? No. You get them when you get change. I get $20s from the bank and spend it, and get dollar bills in change. Once stores actually use coins to give you change and don't look at $1 coins as quarters, that's when people will use them.

It has to be pushed out to retailers first, because the average person will not have stacks of dollars to start with.

[SnakeEyes]

49. see my previous post

[Codeine]

50. Our customers won't take them.

Dollar coins come in and end up in our bank deposit because we can't get them back out.

[Tierra_y_Libertad]

26. Maybe they can foist them on the Chinese as partial payment on the interest of what we owe them.

And, they can later sell them, at twice their value, to relics of the once mighty American dollar.

[Art_from_Ark]

47. Why would they accept them as partial payment

when they can make as many counterfeits as they want for pennies on the dollar?

http://coins.about.com/b/2009/11/11/u-s-mint-warns-about-chinese-made-counterfeit-coins.htm

[Romulox]

27. Cash is pretty much obsolete. Who needs a pocketful of these things?

Perhaps at a casino or an arcade, but walking down the street, jingling? Not cool.

[lazarus]

30. easy solution

do what Britain did when they introduced pound coins: Eliminate the bills.

If we just quit making dollar bills, everyone would HAVE to switch to dollar coins, including vending machines.

[kath]

37. Exactly - force the change by eliminating the bills. VERY simple.

UK has one pound coins, Europe has one Euro coins, both of which are worth more than one dollar.

On edit - Canada also has a one-dollar coin, and eliminated their one dollar bill.

[SidDithers]

42. Canada has a one-dollar and a two-dollar coin...

smallest bill up here is the fiver.

Sid

[eppur_se_muova]

32. ONE COMPANY supplies all the paper for US $1 bills ...

The U.S. buys its currency paper from Massachusetts-based Crane & Company. Crane declined to comment on the story, citing the paper product as "strategic material."

Just last week, the GAO called for replacing the $1 paper bill with a $1 coin, saying that the coins are more durable and do not need to be replaced as often.

The GAO said the switcharoo could potentially save the government approximately $5.5 billion over 30 years, but didn't provide a breakdown of the cost of paper money.

http://money.cnn.com/2011/03/08/news/economy/dollar_cotton_prices/index.htm

Widespread use of dollar coins will cut into their business sharply.
Do you suppose they have tried to "influence" their Congresscritters to block such a calamity? I'll take bets on that.

As the value of a dollar declines, it becomes more and more convenient to use coins in place of bills. The break point between coins and bills varies from country to country, but I would bet that the US has set that point relatively low right now.

[hfojvt]

52. as the dollar declines, it becomes LESS convenient to use coins

You goto the store and spend $8 or $12 or $17. Even if you are paying with cash, are you gonna have, or want to use 8 coins or 12 coins or 17 coins. Sure, you could use a $5 and 3 coins or a $10 and two coins, but once you have pulled out your wallet, you are paying with paper and not generally pulling out a coin purse - the exception being women who have a two pouch wallet in their purse.

I still think people would use dollar coins if there was a $5 coin. Then you could pay for purchases under $20 with coins - a couple of $5 coins and a couple of $1 coins. However, if you don't get rid of the bills, the merchants are not gonna like the coins - there are only so many spaces in a standard change tray. Really no place to put a $5 or a $1 coin.

[eppur_se_muova]

55. Ummm ... no, unless the break point is NOT allowed to shift.

As you pointed out in your 2nd para, inflation should lead to larger denominations in coins. Eventually, the smallest coin is dropped, decreasing the burden of carrying many small coins, as some have already suggested for the US cent. This also frees up a slot in coin trays :). (In colonial times, there was a 1/10 cent coin, eventually rendered useless by inflation, as was the half cent.) Other countries have already used coins of much higher value than the US dollar, enabling their citizens to carry pocket change with real purchasing power -- just as your $5 coin would allow. (I used to have a 5 franc coin, but some SOB stole it. Pre-Euro France issued coins up to the equivalent of ~$15.)

With dollar coins, all purchases *smaller* than those you've given -- which are routine -- could be made with coins only, without needing a whole pocket full of change. Currency needs to evolve and adapt -- something which ours is being blocked from doing.

(Actually, I have been in the habit of keeping $1 bills in my pocket for some time now. Saves a lot of time. In fact, I often keep $1 bills in one pocket, and one or two fives in the other. But they don't make any noise if I drop them ... another argument in favor of coins.)

[Blue_Tires]

33. I've been taking and using them wherever i could...

[Blue-Jay]

35. Dollar coins will never catch on until we stop printing paper dollars.

Until then, they'll just be a novelty that you *might* be able to use at the USPS stamp-vending machine.

Hey! We could call them "loonies" just like the Canadians do if we put Bachmann on the coin's face!

[HopeHoops]

40. I just put 30 of them back in circulation today alone. I use them all the time.

Despite the obvious advantage of their lasting so much longer than paper (and in the long run being cheaper for the country), if the cost of something is only a few bucks, it is far easier to pop a hand in a pocket and pull out exact change than it is to fish out a wallet. I pay exact change whenever possible and usually have it. I'm rarely without at least ten dollar coins in my pocket.

[LiberalEsto]

43. The Washington DC Metro system gives dollar coins

as change when you put money on your Smart Card and want change back. They even have a little notice urging you to use the coins because they last longer than paper dollars.

Metro can't fix its own damn escalators, but it can do "commercials" for the Trasury about using dollar coins.

[Dulcinea]

44. Why dollar coins will never catch on:

Men hate to carry change. I know my husband does. He throws his change on the dresser as soon as he gets home, & eventually banks it.

Women carry change in purses, but men prefer dollar bills, for the most part.

[A Simple Game]

45. Since when does the government care what people want?

Personally I like them. Most people I know at the worst don't mind them.

Now for the truth, businesses don't want them, new cash registers and all. I see no other explanation.

[Incitatus]

51. They did this to save 5.5 billion over 30 years and we spend almost a trillion a year on defense.

[JVS]

53. I'll take them.

They work in the parking meters where I live. Very convenient.

[bhikkhu]

54. They're always doing this sort of thing

Since the early 1800's, its just the way things work. They mandate a big production run based on something or other, then if the coins aren't in demand they sit around until they get melted down for a big production run of some other coin. The lack of demand may make them more collectible.

Example - the 1933 Double Eagle. Almost half a million were minted, but there wasn't any demand so they never left the mint. They sat around in bags, with plenty of other unnecessary coinage, until they were all melted down again - except that 20 or so were spirited out by employees, probably. One sold at auction a few years back for $7.5 million.

[JVS]

56. Hold on. The reason that coin didn't circulate is that owning gold was banned.

This isn't the usual thing.

[bhikkhu]

59. Now I had to look it up - you're right

I had remembered the story a bit off. Other years sat around and gathered dust and then were melted down after limited popularity as well, but not nearly so thoroughly as the '33 Double Eagle.

[JVS]

57. The problem is that a lot of vending machines move from quarters to a dollar bill scanner.

If the vending machines to 50 cent and dollar coins, people would use them more.

[VenusRising]

58. I would always take a $20 bill to buy stamps at the Post Office stamp machines.

They always gave these coins in change, and I loved it! I didn't spend mine, I just put them in a box for a rainy day fund or emergency fund. I would still do it if I could find one of those machines where I live now.