inflationhawk wrote:A zinc penny is worth 0.6 cents, not .06 cents. If zinc doubles in twenty years, it would be worth 1.2 cents. So basically, for every penny you invest in zinc today, you would get a 20% return on it over 20 years in that scenario. No thanks! I would rather re-invest that penny to buy another box of pennies from the bank to hopefully get a copper one. It makes no sense to hoard zinc until copper percentages go way, way down and/or zinc raises in value. The opportunity cost of holding zinc in the form of a penny is too high today.
Who says it will double in twenty years? Nobody knows really. The value of copper in 1982 was also about .6 cents, and see where its at today, roughly twenty years later. Consider this: the melt value of copper didnt exceed face value until 2006. Like I mentioned earlier I am sure SOMEBODY was speculating into the future and holding copper cents way back in 1982 but it wasnt until 2006 that interest in the pre-82 really began to grow. People probably thought you were crazy back in 1982 to hoard something that was worth .6 of a cent. Ok so flash-forward to present day. People now sort with a 'copper return rate ranging from 10%-30% max. Obviously 30% is an expectional rate. For something that was discontinued over thirty years ago thats a remarkable rate of finds. That window however seems to closing at a rate which is arguable. The key thing I think that should be considered is this: We are obviously going to see a composition change sooner than later. Your average person couldnt care less. Then most likely the penny will be elimated entirely some time following this. Obviously nobody knows dates. IF/WHEN the penny is elimanted entirely there will most likely be a 'window period' where you can cash your pennies into the bank or some sort of 'recovery program'. Most people CURRENTLY see the penny as absolutely worthless
and will either go straight to the bank or completely disregard any pennies they might have in their 'piggy bank'. By this time coppers should be more or less gone
and there *Will be zincs but they will either be completely disregarded or quickly exchanged for cash, in the hopes that 'they can get rid of these worthless pennies, quick and painlessly for some cash...'
So, the point is that zincs are in *almost in the SAME EXACT POSITION that copper cents were twenty years ago. The industrial uses vary but nobody can really say whats going to be the metal or alloy of the century. MAYBE its going to be *cheap or 'semi precious metals' like zinc. The biggest difference is that the window *after the composition change will be much shorter, than the window between pre-82's and zincolns, because the penny will likely be elimanted sometime, probably. Imagine when the banks no longer sell boxes of pennies. The penny is completely out of circulation. Many people want this NOW.
Zinc is entirely speculative just like copper, gold and silver despite what some people may claim.
A 1 troy oz. zinc bullion bar is roughly $6. Alot of people think because of the high mintage rates of the zincolns that worrying about those is absolutely useless. But think about it. Aside from people sorting boxes, who has all those zincolns..? Your average person probably has a dollar or two worth in a piggy bank. Realcenters, clearly dont have zincolns or have a lot of zincolns and are frantically trying to get rid of them. The people that have the zincolns in such abundant supply is A) Business (some dont even want penny change) and B) The Banks.
When the zincoln is elimanted the average joe will cash in their piggy banks worth, Busineses will efficently convert them at the banks, and well the banks will have all the zincolns! So, when the banks have the zincolns they'll just ship them back to the mint. If the penny is elimanted, probably 2/3rds of zincolns will be back at the mint in a year flat.
The point of this thread was just to hypothesize that maybe just maybe the zincoln isnt COMPLETELY worthless. Claiming that its too much money to tie up in some zincs is kind of ridicolus. How many of us are currently 'TIED UP' in $1 bills or any bills for that matter. Whats their 'melt value'
. Pennies are still (for the moment) legal tender you know. You can pay with zincolns.
This argument may seem completely ludicrous, but if the penny is elimanted those zincs are gonna be gone fast. Either in the street (b/c they'll be inaccurately deemed 'worthless') or back at the mint. But 20 years down the road we may wish we saved SOME zincs. The mint clearly thinks they have some value, enough to be elimanted.
Zinc, the poor mans copper
