Monday, January 05, 2015

A Jar Full Of Insurance

I followed through on the topic of my post yesterday, sorting through my change jar one more time to identify and segregate the pre-1983 copper pennies within from the rest of the .gov fiat garbage.

I found 106 such pennies in the collection, which as of right now has a "melt value" of $1.98. 

I know, $1.98 doesn't sound like a big deal, and it's not. But look at it this way: if I had rolled these copper pennies up with the rest and turned them in to my bank, I would have lost .93 cents of value. 

That said, don't try to melt yours! The value of the metal in these coins is expressed in those terms, but there's two reasons to leave them intact: a) melting your coins is illegal (though I doubt you would ever get caught, and beyond that I highly doubt that a prosecutor would spend any time on your case); and b) your intact copper coins contain a known amount of copper and zinc in their present form, and that's key. If the day ever comes that you need the value of the copper in the coins, you would likely be able to trade them with people for goods and services on that basis, rather than what the words and images on the coin represent. If you try to barter with a homemade ingot of unknown weight and purity, your bargaining power will be reduced.

I put my starting collection of copper pennies in a jar, which I will add to as I find more. Like I said, $1.98 of copper at present value isn't much, but you have to start somewhere. I'm also not doing this in a vacuum, but as part of a precious metals diversification/self-insurance strategy I've already been pursuing. Anything I can do to further that effort, especially something as cheap and easy as this with its nearly 100% gain, is worthwhile.

Finally, I noticed an interesting thing about the appearance of the various pennies in my jar: the pennies from 1982 and earlier were by and large in great shape, and pennies from 1983 to approximately 1995 were looking fine, but from 1996 to around 2006, the vast majority of the pennies looked like they had been to Hell and back:

From left to right, these are from 1960, 1964, 1965, 1966, and that thing on the end, which I swear is a U.S. penny, is either from 1996 or 2006 (it's so mangled that I cannot be certain).

I pulled out these examples to photograph, and they are the best and the worst of the bunch, but they truly do represent what I was seeing: when our coins in the U.S. held material of value, the coins apparently endured, but after the coins began to be made of materials worth less than the alleged value of each coin, they do not last.

Perhaps the reason for this is that people began to slow their circulation of their pre-1983 pennies, giving them less abrasive existences than their later, less valuable versions. Or maybe they really are made from higher-quality stuff and can be expected to weather the passage of time better. But I was struck by the coincidence of the currency I was handling becoming progressively less physically durable through the years as our government has continuously destroyed our money's value...

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