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Title: If Laws Change, 'Penny Hoarders' Could Cash in on Thousands of Dollars
Source: [None]
URL Source: http://news.yahoo.com/laws-change-p ... ARzZWMDbW9zdF9wb3B1bGFyBHZlcgM
Published: Dec 4, 2011
Author: NEAL KARLINSKY and MARY-ROSE ABRAHAM | A
Post Date: 2011-12-04 01:50:58 by Tatarewicz
Keywords: None
Views: 319
Comments: 22

Joe Henry is on a first name basis with bank tellers across his hometown of Medford, Ore., scouring 15 banks a week with one thing on his mind: pennies.

Henry is often seen toting around bags of pennies, some he buys, others he changes back in for cash, which seems a little strange at first. He's not a collector, he is what's known as a "penny hoarder" and he is not alone.

Inside a shed next to his house, Henry has orange tubs filled with 200,000 pennies, and he spends hours sorting through roll after roll of the coins. But it's not just any and all pennies, Henry is only interested in those that are dated from 1982 and earlier because those are the coins made with 95 percent copper. A copper penny is worth more than other pennies -- now mostly made of zinc -- currently priced at $0.024.

"The copper has such a different sound than zinc pennies do," Henry said. "Real money has that definite sound of money and if you listen to a modern zinc penny, they don't sound the same, they sound sort of tinny."

Henry even has a $500 home counting machine to separate out the copper ones.

Much like the resurging obsession with gold, the price of copper has skyrocketed in recent years and the rising price has led to some unusual sprees. Thieves have been exploiting the value hidden in obscure items, stripping copper wiring from phone and utility cables, from construction sites, even from a 122-year-old copper bell that was stolen from a San Francisco cathedral.

In San Diego, so much copper wiring has been stolen from eight different city parks, that soccer teams can't practice because the field lights stopped working.

But penny hoarders aren't thieves, just opportunists. There are a slew of listing for pennies in bulk on eBay, but what's amazing is they include listings for $10 in pennies being sold for $20 dollars. If you think only a sucker would pay two cents for a penny, you're missing out on a business opportunity that Adam Youngs, who runs a massive penny sorting operation in Portland, Ore., has perfected.

He explained how he can sell a $100 worth of pennies for $176, when shipping and packaging are included.

Youngs' operation, the Portland Mint, is locked inside a secure facility that deals with armored cars -- selling and shipping to clients in every state -- and works in pennies by the ton. He said he has clients with deep pockets who are storing huge sacks of pennies and he has inquires from hedge funds.

"Just in face value alone, about $270,000 dollars [in pennies] right now," Youngs said. "That is just the face value, that is not even the copper value. The copper value is about three times that much."

Inside the Portland Mint. Credit: ABC News

Clients use Youngs because he separates copper pennies from the chump change -- the newer pennies that are only worth $0.01.

But in the weird world of penny hoarding, getting to the copper is a very big problem. It's illegal to melt pennies an there is an obscure federal law that makes it illegal to transport more than $5 in pennies out of the country.

Penny hoarders know this of course, but they also know something else. In what could be the biggest legislation to hit the U.S. Mint in 50 years, officials are now looking at the composition of pennies and nickels and considering an overhaul. If the laws change and the mint decides to abolish the penny, people would be free to melt them down for the copper.

A penny saved, many times over, could be a whole lot earned. Also Read

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#1. To: All (#0)

Comments:

Dave • Richardson

This article makes no sense. A ton of copper is worth $10,000 not $270,00. Even then if $100 in pennies is worth $176, how can $270,000 be worth 3 times that much?

Nandan

Here's the equation: A penny has 3 pennies worth of copper. So, $100,000 in pennies is worth $300,000 in copper. Now, if you sell that for $176,000, that allows the buyer to make about $124,000 in profit. Some of that profit will be eroded by the cost of melting down the pennies, separating the copper, transporting and storing the copper, selling it, and then transporting it again, after selling it. So, you figure that the penny-seller makes about $50K and the copper-seller makes about $100K and expenses are about $150K (remember, you have to spend $100K to get $100K worth of pennies).

Tatarewicz  posted on  2011-12-04   2:59:35 ET  Reply   Trace   Private Reply  


#2. To: Tatarewicz (#0)

Not exactly a sucker's bet, but certainly not the road to riches.

It turns out that it takes approx 181 pennies to weigh one pound. That's $1.81 to make a pound of pennies.

The current market price for copper is $3.58 per pound.

So, presumably, a pound of pennies is worth approx twice what it costs (that is, worth twice the value of the pennies that make up the pound). Not too shabby, except:

While waiting to make your killing when you can sell your pennies to be smelted for their copper at twice their face value, you cannot spend the same pennies. You have $1.81 just lying there, and since you can't put it into the bank to be mixed with all sorts of other coins and currency, you cannot get interest on it nor invest it nor do anything else that gets a return on it in all the time you're sitting on it. Since you're not a fool, you're doing this with a lot more than just one pound of pennies. Maybe a ton of pennies, maybe two or three tons. So that's thousands of dollars in pennies that you cannot be spending, investing or drawing interest on, while you wait for your lucky day. In the meantime, you have to store your pennies somewhere. Maybe in your garage or your basement. They take up a lot of space. And they're not really paying you rent on the space they take up. But maybe you have to pay rent (or mortgage) to someone else for that space during all that time.

The big day comes someday and someone wants to buy your tons of pennies. Do you hire a truck and some big husky men to load it so you can take your pennies to your buyer? If your buyer has to bring his truck to your house and his workmen to carry up the pennies from your basement, he'll probably deduct something from what he's going to pay you.

All in all, it's a lot of trouble for not nearly enough profit.

Shoonra  posted on  2011-12-04   8:26:42 ET  Reply   Trace   Private Reply  


#3. To: Shoonra, All (#2)

deleted

The relationship between morality and liberty is a directly proportional one.

None are more hopelessly enslaved than those who falsely believe they are free.
- Johann Wolfgang von Goethe, 1749-1832

Eric Stratton  posted on  2011-12-04   10:40:00 ET  Reply   Trace   Private Reply  


#4. To: Tatarewicz, all (#0)

the real value of U.S. coinage if one buys "junk" silver they should be looking at this web site before each offer. the only real value of a coin is its melt value. though I have not seen it myself I have heard of gas stations selling gas a gallon for 20 cents face value if pre-1964 coins are used to make payment, which sounds good to the ear; however, the dimes used have a melt value of over $2.35 each when silver is selling for $32.62 an ounce.


the most factual thing ever posted by buckeroo
I have no freaking' clue. buckeroo posted on 2010-07-24 21:33:00 ET

IRTorqued  posted on  2011-12-04   10:56:37 ET  Reply   Trace   Private Reply  


#5. To: Shoonra (#2)

always the sucker for the FRN and the frauds who print them.


the most factual thing ever posted by buckeroo
I have no freaking' clue. buckeroo posted on 2010-07-24 21:33:00 ET

IRTorqued  posted on  2011-12-04   11:02:52 ET  Reply   Trace   Private Reply  


#6. To: Eric Stratton (#3)

Considering the bulk, weight, and the expected price levels for copper, you'd have to wait a very long time, with a very great deal of pennies not drawing interest, to make a real killing by selling the pennies for metal. In terms of the trouble and expense involved in collecting, storing, and possible moving all those pennies, the prospect making a real fortune out of such a deal is rather slim.

Shoonra  posted on  2011-12-04   11:08:34 ET  Reply   Trace   Private Reply  


#7. To: Shoonra (#6)

you keep failing to see that ever time the price of copper goes up those pennies earned interest.


the most factual thing ever posted by buckeroo
I have no freaking' clue. buckeroo posted on 2010-07-24 21:33:00 ET

IRTorqued  posted on  2011-12-04   11:13:41 ET  Reply   Trace   Private Reply  


#8. To: IRTorqued (#4)

Thanks for the COINflation linkage - nice site to know.

Break the Conventions - Keep the Commandments - G.K.Chesterson

Lod  posted on  2011-12-04   11:14:21 ET  Reply   Trace   Private Reply  


#9. To: Lod (#8)

I use it multiple time a day except Sunday as they don't update for the opening of the Asian market which happens around 6 pm our time Sunday evening then I just open Steve Quayle's web site and plug the current ask price into the coinflation melt value formula. I like to watch for lots of .925 jewelry being sold as scrap it will be listed if pieces are wearable, if they are, good, my wife gets a new necklace(s), bracelet(s) and or ring(s) and I increase my stockpile of PM. the non-wearable stuff that is marked goes in deep storage and the unmarked but tested goes into my melt for castings pile. on occasion I make rings from pre-64 quarters or halves.


the most factual thing ever posted by buckeroo
I have no freaking' clue. buckeroo posted on 2010-07-24 21:33:00 ET

IRTorqued  posted on  2011-12-04   11:29:34 ET  Reply   Trace   Private Reply  


#10. To: IRTorqued (#9)

Sounds like a full-time occupation.

It seems like every store in Austin has a We Buy Gold banner out front, and then there's the full-page ad in the daily failure for same.

Break the Conventions - Keep the Commandments - G.K.Chesterson

Lod  posted on  2011-12-04   11:48:00 ET  Reply   Trace   Private Reply  


#11. To: IRTorqued (#9) (Edited)

Quayle's site is most worthy also - thanks.

Break the Conventions - Keep the Commandments - G.K.Chesterson

Lod  posted on  2011-12-04   11:59:02 ET  Reply   Trace   Private Reply  


#12. To: Lod (#10) (Edited)

actually just a few minutes a day and with eBay sources are easy to find, my latest catch was nearly 400 grams at $100.00 below spot price. for sterling my rule of thumb is weight in grams multiplied by .925 multiplied by .75 and work up from there, never to go above .95. as example 148 grams silver lot a starting bid would be 148*.925 (equals 136.9 which is the pure silver content)*.75=$102.675 and let it go if price exceeds 130. some sellers like to inflate shipping cost so no matter the shipping cost I deduct that amount from my max bid. coins on one day can be easy to win at below spot price and other days fools will go 10 to 20 percent over spot.
the buyers advertising to buy gold will at best give the seller 50% of the melt value of the metal. for buying scrap gold there are as many formulas as there are carat values. see here
also beware of terms like Tibetan Silver and/or German Silver, today the silver content of Tibetan silver is usually right at zero and German silver never contained any silver.


the most factual thing ever posted by buckeroo
I have no freaking' clue. buckeroo posted on 2010-07-24 21:33:00 ET

IRTorqued  posted on  2011-12-04   12:17:19 ET  Reply   Trace   Private Reply  


#13. To: IRTorqued (#12)

Why are the metals priced/oz, then it goes to grams when weighing?

(I was excused from jury duty when I asked how many oz would that gram of cocaine be?)

Break the Conventions - Keep the Commandments - G.K.Chesterson

Lod  posted on  2011-12-04   12:56:41 ET  Reply   Trace   Private Reply  


#14. To: Lod (#13) (Edited)

Why are the metals priced/oz, then it goes to grams when weighing?

A reasonable question. In the US (and some other places), precious metals are weighed by pounds and ounces -- but precious metals - gold, silver, and platinum - are weighed in troy ounces and pounds; a troy pound has only twelve (not 16) troy ounces - each troy pound is a a little more than 4/5 of an avoirdupois pound, each troy ounce is a fraction heavier than one avoirdupois ounce. I honestly don't know if copper is weighed in troy or avoirdupois. Obviously this makes for some confusion, so out of an abundance of caution this system is usually translated into metric measures (no difference for precious metals).

31.103 grams to 1 troy ounce; 373.24 grams to 1 troy pound (=12 troy oz),
28.349 grams to 1 avoir ounce; 453.59 grams to 1 avoir pound (=16 avoir oz).

Shoonra  posted on  2011-12-04   14:56:08 ET  Reply   Trace   Private Reply  


#15. To: Lod (#13)

as there are two standards for the ounce PMs are measured in troy ounces which equal 31.1034768 grams where as an avoirdupois ounce is equal to 28.349523125 grams. most sellers on eBay dealing in "junk" silver (coins) will claim the weight is 1/2 or 1 ounce or whatever but are not in fact in troy ounce measurements, so in the end the buyer is getting a lighter weight of PM. I very seldom bid on those auctions that do not specify the coins making the claimed weight as like earlier stated I consider only the melt value when placing my bids. lots of scrap silver will many times have stones and other such material in the listed weight and must be considered when placing ones bids. if the items included in the sale are wearable great but I am only going to bid limit on what looks to be weight of the metal alone. there are a few (very few) coin sellers who do measure in the troy ounce and are sure to make that point in the item description. remember when buying coins circulation means wear on the coins so they can be a bit lighter than the mint weight listed at coinflation, bid accordingly.


the most factual thing ever posted by buckeroo
I have no freaking' clue. buckeroo posted on 2010-07-24 21:33:00 ET

IRTorqued  posted on  2011-12-04   17:10:07 ET  Reply   Trace   Private Reply  


#16. To: Shoonra, Lod (#14)

copper is not a precious metal and therefore not measured in troy weight, same applies for zinc and nickel.


the most factual thing ever posted by buckeroo
I have no freaking' clue. buckeroo posted on 2010-07-24 21:33:00 ET

IRTorqued  posted on  2011-12-04   17:13:34 ET  Reply   Trace   Private Reply  


#17. To: IRTorqued, 4 (#15)

Obviously, you know what the heck you're doing. Good job, and keep it up.

I'm too tired to learn what you know, so I'll just keep plugging along with my man Richard and onlygold.com , my father traded with him, and it's become a family tradition.

Cheers!

Break the Conventions - Keep the Commandments - G.K.Chesterson

Lod  posted on  2011-12-04   17:20:55 ET  Reply   Trace   Private Reply  


#18. To: Shoonra (#6)

deleted

The relationship between morality and liberty is a directly proportional one.

None are more hopelessly enslaved than those who falsely believe they are free.
- Johann Wolfgang von Goethe, 1749-1832

Eric Stratton  posted on  2011-12-04   18:54:17 ET  Reply   Trace   Private Reply  


#19. To: Eric Stratton, 4 (#18)

If the penny is de-commissioned as currency, there will immediately be buyers/smelters to buy them at spot.

No problem.

Break the Conventions - Keep the Commandments - G.K.Chesterson

Lod  posted on  2011-12-04   18:58:53 ET  Reply   Trace   Private Reply  


#20. To: Lod (#19)

deleted

The relationship between morality and liberty is a directly proportional one.

None are more hopelessly enslaved than those who falsely believe they are free.
- Johann Wolfgang von Goethe, 1749-1832

Eric Stratton  posted on  2011-12-04   19:03:24 ET  Reply   Trace   Private Reply  


#21. To: Lod (#17)

you seem to be good to go, long term associations tend to be of them self an investment.


the most factual thing ever posted by buckeroo
I have no freaking' clue. buckeroo posted on 2010-07-24 21:33:00 ET

IRTorqued  posted on  2011-12-04   19:52:10 ET  Reply   Trace   Private Reply  


#22. To: Tatarewicz, All (#0)

Recent news from Canada: Human Rights Museum not getting another dime: Gov’t

The Canadian Museum for Human Rights was hoping to dig its hands deeper into taxpayers’ pockets to cover projected cost overruns when it’s slated to open its doors next year.

Well, it’s not going to happen.

The CMHR will not be getting an extra dime in operating funds from the federal government, the Winnipeg Sun has learned.

The Department of Canadian Heritage says it will not increase the museum’s annual operating grant and that museum officials will have to make do with the $21.7 million already allotted to them.

“Our government’s commitment to the museum is unchanged — $100 million to build the museum and $21.7 million per year to operate it,” said James Maunder, spokesman for Heritage Minister James Moore. “That is our commitment, and there will be no new funds to the museum.”

Well, that puts the kibosh on that one.

Pan to U.S. Pennies for the Persecuted school project news -- ongoing since around 2006/2007 for Holocaust Awareness. The goal is for participating schools to collect millions of pennies each or as many as they can. Each penny at each school is supposed to represent one Holocaust victim.

Uploaded on May 27, 2010

Navarro 5th Graders visit the JFSA Holocaust Museum to get an up close and personal view of the events they have studied from WWI during their unit on tolerance. There they met Rose Sherman Williams, a survivor from Auschwitz. They also donated another 20,000 pennies from their 6 million penny collection project.

-------

"They're on our left, they're on our right, they're in front of us, they're behind us...they can't get away this time." -- Col. Puller, USMC

GreyLmist  posted on  2011-12-06   17:19:25 ET  Reply   Trace   Private Reply  


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