Absolutely nothing. This blog post is going to be less calories today….thus, blog lite. Unlike the beer products, it may even have less taste (content). You will have to forgive me for going lite….but, on the first day of vacation and my mind is off in Tahoe.
So, back to pennies and lite blogs.
I have always said that I have a simple mind….my wife just calls me stupid But, while starting off traveling for the vacation, I saw some piece out of some Los Angeles television station that showed people going to banks and other companies and buying hoards of pennies. They were not getting a special price on the pennies…they were simply buying pennies at the going rate of $0.01 (even though we know it costs the US Treasury about $0.0134 to make). I think that should be another blog for another day….I mean, really, does it actually make sense to spend more money to make a penny than it is worth!?
Okay, back to getting on track. So, they showed numerous people buying all of these pennies to take back to their home to basically “store.” Truth was, all of these individuals were buying pennies so they could sort out the pennies that were minted prior to 1983. Why? You got it…pennies made prior to 1983 were made of copper. We have all heard the stories of the thieves who are taking copper from construction sites to sell. At least this effort being undertaken is legal and potentially lucrative (even though I don’t think I could do it!).
For those of you who are interested, a copper penny’s worth is about 133% (not taking into consideration the value of time AND money) to that of non-copper pennies. So, all of these individuals are collecting pennies on the expectation of future value. They even had a gentleman featured who had over $250,000 in pre-1983 pennies with a current value of over $600,000.
Now before we all start raiding banks and any other place we can locate pennies, keep in mind that it is currently U.S. law that a penny cannot be melted down nor can you transport (over a certain, limited weight) pennies to another country. Soooo, if you can’t melt the pennies down to realize that return on your investment, what is one to do?!
Well, all of these folks are banking on the belief that at some point in time, pennies will no longer be valid or accepted currency. If not currency, then let the “melting” begin. As one gentleman pointed out in the piece….the worst thing that can happen is that he will get even money on his efforts and that a “penny will always still be worth one penny.”
I am not one to run down to my local bank….but, I gotta tell you that I thought this would be a fun opportunity for my son to use self-directed funds and run around to banks. He is strong and can lift all of those pennies, and what a great way for a kid to “work” his own funds into something, possibly, that will be worth more money down the “potential” road. Maybe when I tell folks the benefits of self-direction to invest in assets such as real estate, hard money loans and businesses….I can start saying “pennies” as well.
Have a great week…it is off to Tahoe!