Wow. Losing money from making money… That's got to be hard to do, right?

In 2012, it cost the U.S. Mint two cents to create a penny. I am not rounding up. It cost two cents. That is actually down from 2011, when it cost 2.4 cents to make a penny.

It's not just the penny… Last year, it cost the Mint over 10 cents to create each nickel in 2012.

When you add it up, our brilliant government lost nine figures last year alone (that's a number in the hundreds of millions) simply on minting pennies and nickels last year.

And our government lost more than $100 million on MAKING MONEY – something that should be a guaranteed profit!

Think about it this way…  

The federal government takes your money in taxes – one-third of your income. And then it uses that money to mint pennies and nickels – at a major loss… at a cost of twice the face value of the coins!

Your government has an incredible power – to mint money out of thin air. And it is so incompetent, it manages to lose twice the face value of those coins on every one that is made.

Even crazier, this has gone on for years… and your government hasn't done anything about it. For proof, check out this actual quote from the U.S. Mint's 2012 Annual Report (emphasis mine):

The costs to manufacture and distribute both the one-cent and five-cent coins exceeded their face value again, just as they have for each of the last six years. This negative seigniorage concerns us, and we continue to explore ways to address it.

Your government has lost money from printing pennies and nickels each year for the last six years… And it is still "exploring ways to address it."

Your government commissioned a two-year study from an outside company to figure out what to do, which just concluded in December 2012. The result was… nothing! It apparently needed more time to reach a conclusion.

How much time do you need? I can solve this problem in 20 seconds…  

You have two choices:

•  
Stop minting the coins you're losing money on (for example, get rid of the penny).
•  
Start minting money using a material (like steel for a nickel) that's worth less than its cost of production.

Done! How much should I get paid for that absolutely correct advice? Didn't even take me one year!

This is not rocket science. Australia figured this out in 1991 and got rid of its pennies. It's been done before. Our government is just failing here.

Midnightrider wrote on 04/25/13 at 19:46:38:

Must be nice to be rich.  I am not and I count my pennies.  
The cost of production of coins is mostly labor.

You may think that Government Is Totally Incompetent -- but it is still in business.

Canada has saved millions upon millions of dollars by discontinuing the one dollar bill and the two dollar bill. They replaced them both with a one dollar and a two dollar coin (very distinct looking from their other coins).

An additional benefit of this is that vending machines can work with coins only, no more trying to stuff worn dollar bills into the bill slot which is very hard to convert to and maintain in vending machines...a good move by Canada to save money. We could do the same thing here and save a bundle also.

Starlifter wrote on 04/25/13 at 21:46:44:

We just got rid of the penny too, and they are talking about a $5 coin.
When they first came out the $1 coin had a loon on one side, so we called it the "looney". When the $2 coin came out we called it the "tooney".