Take all your disposable cash and buy pennies

[JerrySpringer]

Doing a back of the envelope calculation, it seems that copper cents are a screaming deal if you are willing to hold onto them. Basically, they are worth about 2 cents each in copper now. Even if copper grows at about 2% annually in price, those copper cents will average out a 4.86% annual return if you hold them for 25 years. Show me a bond that can do that. Of course, the penalties are stiff if you cash in your cents at face value years from now. I think it is an ultimate buy and hold strategy. It is taking a big chance, as people started hoarding copper cents in 1982 I am sure thinking that they would be a good hedge (ha!).

The way I look at it, I do not inventory my copper cents. Maybe one day I will weigh them and come up with all the dead money they sit in. Worse case scenario, I created a rainy day fund that will force me to work and trying to get the cash out of the hoard, hence I will not apt to spend it all in one shot.

[Country]

Doing a back of the envelope calculation, it seems that copper cents are a screaming deal if you are willing to hold onto them. Basically, they are worth about 2 cents each in copper now. Even if copper grows at about 2% annually in price, those copper cents will average out a 4.86% annual return if you hold them for 25 years. Show me a bond that can do that. Of course, the penalties are stiff if you cash in your cents at face value years from now. I think it is an ultimate buy and hold strategy. It is taking a big chance, as people started hoarding copper cents in 1982 I am sure thinking that they would be a good hedge (ha!).

The way I look at it, I do not inventory my copper cents. Maybe one day I will weigh them and come up with all the dead money they sit in. Worse case scenario, I created a rainy day fund that will force me to work and trying to get the cash out of the hoard, hence I will not apt to spend it all in one shot.

You got that right! I started hoarding copper in 1980 (you just put the rolls away in storage then); never brought any of it back to the bank. I'd say having a ton or two wouldn't hurt a bit; really, not much opportunity lost and you've always got a rainy day fund around. But, I've been holding mine for quite a while. So, be thinking that it may be your sons and daughters that will reap the benefits of your copper hoard.

[JerrySpringer]

So, be thinking that it may be your sons and daughters that will reap the benefits of your copper hoard.

Another take on my calcs is that they best bang for a buck will happen as soon as copper cents are allowed to be melted and the the spot value appreciated then. If you do various calcs with my 2% per annum growth rate, the long-term average growth rate gets worse as the years go by. Hence, you hold onto the copper now and if the melt is allowed, say 10 years from now, you sell then and take the cash if copper is at a spot value that made it worth the hold time. It is a risk to hold, but honestly, try to get 2% interest from a bank account. You'll have to buy a 5 year CD and go though the paper work, etc.

[uthminsta]

You're preaching to the choir - in a good way.
Actually, you're singing a song we wrote.
Last night, I had to move my copper stash from one part of the house to another, and for the first time in a while I got a better idea as to how much I have set back. More than I thought, but less than I probably should have. I haven't sorted for copper much lately, as I have not had the time. But you better believe I'm still gonna keep my Ryedale... because I know the wisdom in continuing to do the one thing it does for me. And that is separate the good from the bad... separate sheep from goats... separate VALUE from JUNK.

[hammerrob]

Here's how I imagine it playing out: Sometime in the next 10 or 20 years something crazy will happen in the world and copper will be selling for $7-8/lb. The melt ban will stay in place, because the gov has no incentive to lift it. But there will still be a big opportunity to cash out at 3-4 times face value. The smart guys will cash out quick while there is still kind of a 'mania' about the price of copper.

[fasteddy]

I am ready....I have got pennies everywhere...I am waiting on Highroller to open the Texas branch of the Portland mint.

[TwoAndAHalfCents]

Several years ago I started out with the approach of "Take all your disposable cash and buy SILVER". At 5X face for 90% silver how could you go wrong? I set a goal for total ounces and converted available cash to silver until the goal was achieved. Then I simply set a new higher goal and continued the pattern and followed that up with yet another higher goal and more of the same. As the price of silver rose and acquiring 90% silver meant paying 25X face that's when I switched to the idea of "Take all your disposable cash and buy pennies." The only complaint is that those pennies take up a lot more space than the silver.

[cooyon]

IMO, the only reason the government will lift the melt ban will be to create capital gains tax liabilities for sellers as "collectables", 28% rate now, I believe. I see the lifting of the melt ban to be accompanied by onerous paperwork reporting requirements on the part of buyers, may be wiser to just keep dealing here rather than get on the radar. Just my opinion as a retired fed.

I have always viewed 95% Cu as insurance vs investment, I cringe every time one of the CNBC pukes refers to "investing" in gold, etc. They have to keep that bubble in the air.

[amalekidad]

'Disposable cash'?! My smoking hot wife has already disposed of all my cash!
Every day the spot price of silver drops, and here I sit here working and paying taxes.
I did pick up two boxes of pennies yesterday while I was at the bank paying a credit card bill.
Anybody want two boxes of 2014-Ds?

[mishra142]

If anyone would like to spend all their disposable cash on copper pennies contact me i'll sell ya some

[fansubs_ca]

'Disposable cash'?! My smoking hot wife has already disposed of all my cash!

Smokes do tend to be expensive. ^_-

[JerrySpringer]

http://mises.org/daily/6752/How-Inflati ... our-Pocket

Everything keeps pointing to the idea you need to lock up your fiat money in something that will outpace or stay in check with inflation. I think one of the freest lunch we will have are those lowly one cent copper cents.

[johnbrickner]

Nothing to lose but the time and effort you put into it if you sort your own.

[JerrySpringer]

Nothing to lose but the time and effort you put into it if you sort your own.

I do sort my own. Spent many hours sorting while listening to the internet radio. In a way, I might of saved some money by doing this versus going and burning up gasoline money or looking for some bric a brac item to buy off of Ebay. Not to mention all the copper cents sitting in those coin machine bags now just sitting there waiting to germinate once copper hits $5/lb....TWENTY YEARS FROM NOW!

[theo]

Nothing to lose but the time and effort you put into it if you sort your own.

I do sort my own. Spent many hours sorting while listening to the internet radio. In a way, I might of saved some money by doing this versus going and burning up gasoline money or looking for some bric a brac item to buy off of Ebay. Not to mention all the copper cents sitting in those coin machine bags now just sitting there waiting to germinate once copper hits $5/lb....TWENTY YEARS FROM NOW!

I've met my goals concerning copper pennies, however I do hand sort a box or two a month because I find it relaxing and I enjoy finding wheats, canadians and the inexplicable BU 1964 or 1968. I don't hold any illusions about getting rich off of copper pennies, but I do see them as an important part of my inflation hedging strategy. They also help with security. Anybody looking for my meager stash of PMs will have to wade through a sea of copper to get it. My formidable collection of baseball cards serves a similar purpose. Finally collecting copper serves as a nice cover for other activities. It is safer to be known as the crazy copper penny guy than the crazy gold or diamond guy.