Tuesday, September 8, 2015

face value

Just got my 20 troy ounce fine silver order today from Monarch.  Since I last posted about them, they sold out their inventory of 1,400 one ounce rounds through the long weekend (silver is very low right now).  They minted an additional 2500 today.  By ordering silver rounds from them, I effectively turned 34,396 pennies (including shipping and handling and $1.29 above spot) that were minted with nothing to back their value (at a cost to the government of 1.7 cents per penny) and have a melt value of .004 cents per penny, into bullion that at the current spot price of silver is worth $295.  If I melted down those same pennies that the government created out of thin air at over one and a half times their "monitary value" to produce, their melt value would be $138.  Of course if I make my new silver into something that I sell at a small profit, my digital paypal dollars have dubious value until I exchange them for something of tangable value.  The modern day alchemist's dilemma...  91,100,73,0,B
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8 comments:

rj said...

You can transfer the Paypal dollars back to your bank and then withdraw pennies.

September 8, 2015 at 7:26 PM
Larry G said...

is that $345 for $295 worth of silver... ? and how does the govt give up 1.7?

I guess I don't understand "high" finance!

September 8, 2015 at 7:30 PM
Margery Billd said...

:-)Nope did not understand a word you said.

September 8, 2015 at 8:00 PM
John Wells said...

Margery...try this:
http://consumerist.com/2012/01/13/making-a-case-against-pennies-can-be-informative-and-funny/

September 8, 2015 at 8:45 PM
Dale said...

Call me a pessimist but the people in the shadow who control the value of fiat probably control the value of shiny metals.

September 8, 2015 at 9:54 PM
VirginiaMan said...

I was going to warn you that the Department of Treasury will be unhappy that you are destroying money.

it's technically illegal to deface U.S. currency to the point at which it's rendered unusable. The specific federal law at issue is 18 USC 333, which proscribes criminal penalties against anyone who "mutilates, cuts, defaces, disfigures, or perforates, or unites or cements together, or does any other thing to any bank bill, draft, note, or other evidence of debt issued by any national banking association, or Federal Reserve bank, or the Federal Reserve System, with intent to render such bank bill, draft, note, or other evidence of debt unfit to be reissued."

However, since the they are not backed by our government, "Smelt Away"

September 9, 2015 at 7:18 AM
Larry G said...

I was under the impression that pennies are no longer made of copper - that they substituted other metals of lower value.

wouldn't that be the obvious thing to do - to not use metals that can increase in value beynd the coin's value?

spent many a day in my childhood flattening pennies on a nearby train rail....

September 9, 2015 at 7:50 AM
Wyowanderer said...

Larry,
You're on the right track. Pennies have been copper plated zinc since 1982. One of the activities of our local high school lab is to make hollow pennies using some sort of acid that eats zinc, but not copper.

September 9, 2015 at 10:43 AM

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