A Penny For Your Thoughts!
Canada, along with a bunch of other countries including the States, is planning to do away with the penny. Instead, all our calculations will be rounded out to the nearest 5 cents.
I think this would make things much easier when making change, but more than that it might save us a pile of money too.
Apparently minting all those coins costs us a lot of money.
If memory serves me, it could be in the hundreds of millions of dollars!
Why so much you ask?
I'm glad you asked!
I just found out that in typical government fashion, it cost them 4 cents to mint 1 cent.
Why doesn't this surprise me?
Your "fiscally conservative" scribe;
Allan W Janssen
I think this would make things much easier when making change, but more than that it might save us a pile of money too.
Apparently minting all those coins costs us a lot of money.
If memory serves me, it could be in the hundreds of millions of dollars!
Why so much you ask?
I'm glad you asked!
I just found out that in typical government fashion, it cost them 4 cents to mint 1 cent.
Why doesn't this surprise me?
Your "fiscally conservative" scribe;
Allan W Janssen
Labels: change, mint, money, penny for your thoughts
posted by Allan W Janssen | 8:39 a.m.
6 Comments:
This is another one of those urban legends that crop up over and over again. Unless you can produce some corroborating evidence, I'm calling bullshits on this one, too.
That's straight from the horses mouth so to speak, the Canada Mint.
Paul what you're forgeting is that if the penny was only used once it wouldn't make economic sense, but they are used thousands of times over in different transactions so that brings the "per use" cost down!
See?
A story from the Toronto Star (which, I assume, is where you saw it) on Feb 16. Some choice quotes:
"In Canada, the cost of producing a penny is 'less than one cent,' said Royal Canadian Mint spokeswoman Christine Aquino."
"Canada's finance department periodically reviews the status of the penny, as it does all of the coins produced by the mint. So far, those reviews have concluded that the elimination of the penny is not warranted."
"The Bank of Canada said yesterday that, because the decision rests with [finance minister Jim] Flaherty, it 'does not have an official position and has not published any papers on this issue.'"
The Royal Canadian Mint has no actual say in the matter, as they simply make and distribute the coins under the direction of the Bank of Canada, who, in turn, are under the direction of the Finance Minister. This story crops up every few years. This time it was raised by the Desjardins Group, but they have no actual say. They're just expressing a corporate opinion. I don't expect any more action will be taken on it this time than last.
Thank you for that Paul. I acutally heard it on a Toronto radio station, (CFRB I think?) but it is nice to know that they can make the damn things for less than they are worth.
Still the thrust of the story on the radio was the elimination of the penny entirely and I think this would be a good idea.
Just round anything out to the nearest nickel.
Over the last few days I have been hearing a lot of chatter about this both here in Canada and in the U. S. so it must have struck a chord with people.
Kiss the penny goodbye????
According to that article, Australia and New Zealand have already done so. I can't really see it being a problem, although the article also stated that amounts like $9.98 would be rounded up to $10.00, while amounts like $10.02 would be rounded down. My response to that? "Yeah, right!" All amounts would be rounded up. Anyone who doubts that is just plain naive. But again, it's pretty unlikely to happen in the near future. Maybe in a few more years, as cash becomes less and less common. I already almost never carry any...
FYI, back when this was a fresh item, I sent an email to the Canadian Mint asking about it. Today I received this reply:
16 March, 2007
Dear Paul Little,
Thank you for contacting the Royal Canadian Mint.
I acknowledge your email of February 19, 2007 inquiring about the one-cent coin.
The Royal Canadian Mint manufactures and distributes Canadian coins, including the one-cent coin, based on market demand. The production of the penny is driven by the needs of the marketplace and demand for this coin continues to be healthy. For example, in 2005, the Mint produced over 800 million once-cent coins to meet market demand for the coin.
Only the Government of Canada has the authority to eliminate an existing denomination, including the one-cent coin. And seeing as the demand remains high, the government does not intend to remove it from circulation.
I hope you find this information helpful. Thank you for your interest in the Royal Canadian Mint.
Sincerely,
Marie-Eve Dauteuil
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