the one cent coin aka penny

Good morning and welcome to the August 16th edition of a Top Shelf Thursday! Last Monday I received a reader request to write about the penny. Assuming he was referring to our one cent coin and not the British Penny that it was named after, I can take a stab at it this morning. I’m not sure which design he was referring to, so today I’ll offer an overview and you my dear readers can steer later discussions. Before we begin, let’s refill our cups and pull up a chair and take a quick look at what the precious metals are doing. Brewer & Shipley greet me this morning with their 1970 hit, One Toke Over The Line.

Gold is currently down -$1.60 this morning at $1,179.40.

Silver is currently up +$0.20 at $14.70.

Platinum is currently up +$34 at $791.

Palladium is currently up +$54 at $887.

Folks, yesterday saw gold drop another $19 on 382,000 contracts traded, most of which were directing gold lower. Gold is working its way back up this morning, but with the continued trade war the U.S. is having with China, all bets are off.

So to dive right into a discussion on cents, let’s go back and look at the “Coinage Act of 1792.” In Section 9 of the Act, Congress authorized the minting of coins struck in gold, silver, and copper. Cents were defined to be one hundredth part of a dollar, and to contain eleven penny-weights of copper. To appreciate the size of these coins, consider that 11dwt (penny-weights) equals a bit more than 17g (grams) or .55ozt (troy ounce). That folks is a hefty cent! Compare that to the modern one-cent you know that weighs 1.6dwt or 2.5g and you realize how really massive the first one cent coin was.

The most interesting aspect of the Coinage Act of 1792 is that of Section 16. This paragraph specifically focuses on what coins are to be considered lawful tender, and here is a really interesting note. Only gold and silver coins struck by the mints are lawful tender. The copper cent and half-cent are considered tokens and not tender. Take a moment to let that sink in.

Through the years, as the value of copper increased, the one cent coin became a copper alloy coin of varying percentages until in 1982 when it was changed to a zinc coin with copper plating. Couple that information with changes in the coin’s diameter and thickness over the years and you have five changes in weight, nine changes in metal composition, and thirteen changes in design. All for a coin struck by the United States Mint that was not lawful tender, or at least not until 1965.

In 1965, then President Johnson commented “Our uses of silver are growing as our population and our economy grows. The hard fact is that silver consumption is now more than double new silver production each year. So, in the face of this worldwide shortage of silver, and our rapidly growing need for coins, the only really prudent course is to reduce our dependence upon silver for making our coins.” This need to get away from silver coinage gave Congress the opportunity to establish “The Coinage Act of 1965,” where in Section 102 they state “All coins and currencies of the United States (…), regardless of when coined or issued, shall be legal tender for all debts, public and private (…).”

And that brings us to 2018 and the news from a few years ago where hoards of pennies have been cashed in. How many hoards are still out there? And instead of banking the hoard, if your cents are pre-1982, why not consider selling them for their copper? The spot price of copper this morning is $0.01g and a pre-1982 cent is 2.5g. Just sayin…

Well, I’ll let that be it for today. Go out there and make a difference! See ya later!

*Disclaimer: Precious Metal Musings™ is written for entertainment and news purposes only and should not be used in making purchases and/or sales of precious metals.