Some of the most reported and argued news in U.S. currency is the strong indication, according to many reports from many sources, that the U.S. Mint has stopped producing the one-cent piece, the penny. Wall Street Journal articles, Axios, CNN, and MSNBC, among others, indicate the days of the penny, which were once so ubiquitous, might be counted.
This possible cessation of penny production is largely due to economic conditions. It has cost more to produce a penny than a penny is worth for years. Latest estimates are that it costs the U.S. Mint over one cent to manufacture an individual penny, so it's costing the company to continue making them. This inefficacy in the economy combined with the decreasing real-world use of the penny in an increasingly digital age has most probably been the culprit.
To generations of Americans, the penny has been ubiquitous in everyday commerce. Most remember "which president is on penny" – Abraham Lincoln – who's been there since 1909. The possibility of losing the penny threatens both nostalgic and practical acceptance. Some even remember the rumors about the "penny dollar," a tongue-in-cheek recognition of its diminishing purchasing power.
The consequences of the stoppage of pennying are extensive. To consumers, it could result in instances of cash rounding even further, as has been the case in nations that have eliminated low-denomination coins. Businesses would require adjusting prices as well as the management of cash. The symbolic "penny symbol" (¢) may no longer find its way on price stickers and in everyday language.
Even if the penny itself contains little in the way of valuable metal (principally zinc coated in a protective copper layer), this story rings in the larger argument about the usefulness and worth of physical money. The penny controversy will generally be a shadow of the controversy surrounding the use of cash in an increasingly electronic world.
The Treasury Department has yet to officially confirm penny manufacturing to halt. However, the repetition on so many reputable news sources adds great weight of credibility to such remarks. The logistics of halting production and addressing the existing inventory of pennies in circulation will likely be the subject of future stories.
Since BOLD Precious Metals specializes mostly in bullion, the end of the production of the penny may at first glance appear unrelated. It is indeed a major economic and cultural event in the United States, our main market. Being aware of these changes enables us to engage on a wider financial level with our readers.
We will be keeping track of official notices from the U.S. Treasury on the fate of the penny and share news as it unfolds.
For more information on the precious metals market and related financial news, visit BOLD Precious Metals
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