Many of you have seen the commercials. You can't turn on a TV set these days without seeing a "buy gold" commercial. With gold at $1100 per oz this may not be a viable option for many to consider in these troubling economic times. There is one type of US currency that is at the time of this writing (26DEC09) worth the same in melt value as face value and that currency is the US nickel. If you were to point your browser to Coinflation, you would see a list of all the coins in circulation and their relative melt values. This may be a wake-up call to some of you. The US nickel is actually a viable way to store wealth on a smaller scale ($100s, not $1,000). $100 in nickels is a little smaller than a loaf of bread so storing a large amount would take up considerable space.
Lets look at possible situations in which owning some nickels would pay off:
- Bank Run: If there is a run on the banks you
maywill not have access to your money. If you have stockpiled tangible goods and commodities you can still use those for barter and trade. The nickel would be a recognizable currency and it's content would be widely known to those living in economic collapse.
- Hyperinflation: Paper money would quickly devolve into worthlessness, a la Weimar Republic or Zimbabwe. Your nickels could go exponential in value (not as likely as a bank run, but you never know).
- The Federal Reserve begins to realize that it costs more to make a nickel than the nickel is worth and they take the current nickel (75% copper and 25% nickel) out of circulation. They would then replace the old nickel with a new, worthless plastic or silver flashed steel nickel. Gresham's Law would take effect (bad money drives out good money) and those that had stockpiled the good nickels would profit greatly from their foresight.
To read another article on the subject of stockpiling nickels, I encourage you to point your browser to survivalblog.com. It is an invaluable resource. Donate if you can as it is worth it. In closing, it may not be a bad idea to acquire some nickels and save them somewhere for a rainy day, Zimbabwe style.
I saw your original video re: nickels last spring. So far I've squirred away $750.00 in nickels. I'm using ammo cans and nickel loaves from the bank to store the 15,000 nickels.ReplyDelete
The congress idiots have given their Constitutional power in determining the currency of the United States to the Secretary of the Treasury. The Sec-Tres now has the power to determine the composition of our currency. As of the Spring 2009 the US Mint has stopped minting coins. With an economic downturn citizens have been converting their saved coins into paper dollars, thus a surplus of coins is awash in the banking system.
I expect that Gresham's Law is about to hit the nickel with the US Mint retooling to make a steel nickel for 2010. So stock up now while the "good" nickel is still available. Its a win-win situation, the value either remains .05 cents (unlikely) or the value goes up (likely).
Last note: I use cash for 95% of our non-bill purchases. I've noticed a decline in recieving nickels in my change. Quarters and dimes rule my change collection jar, why? Hmmmm, a shortage? There has been several instances where my credit union didn't have $30.00 in nickels and said I should check back the next day. Hmmmmm, GOT NICKELS?
John, thanks for posting this. Like you said in your comment (and what was conveyed in my video), worst case your nickel is worth 5c. If you look at www.coinflation.com right now, you'll see that the nickel is actually worth MORE than 5c in melt value as of today.ReplyDelete
I was not aware that the mint was retooling for steel nickels. If you have any data or a link to the retooling, please let me know.
TRW, here's a link regarding the US Mint stopping production of nickels and pennies in April 2009. As for the retooling for steel coins, this is conjecture on my part. Gresham's law dictates a switch to a cheaper alternative. I also know it takes awhile to retool on such a large scale.ReplyDelete
As I find credible sources of data, I'll pass them along. The US Mint has to hold its cards close to prevent panic. I feel coin collectors will know first what is going to happen. This info might make it to the sheeple via the MSM, eventually.
Meanwhile, stocking nickels continues... Many thanks for all your insights!