Mighty Bargain Hunter

Will the new Lincoln cents actually be rare?

March 3rd, 2009 | by mbhunter |

Bob over at ChristianPF questions whether it was wise for the powers that be to allow the US Mint to proceed with its minting of four commemorative Lincoln cents to honor the 200th anniversary of Abraham Lincoln’s birth.

I’m not totally convinced that the new designs will be in widespread circulation. As Bob noted, the cost of minting cents is prohibitive relative to the coin’s face value.  Though zinc and copper prices have dropped from their highs to their prices about five years ago, the cost of minting a cent is still the highest of the coins in relation to its face value.

The launch of the new design took place in Lincoln’s birthplace of Hodgenville, KY, on the bicentennial of his birth.  Half a million of the new cents were offered at face value at that ceremony to any of the 1,500 attendees that wanted them.  The Mint, though, has given no other information on the release schedule for the other designs, or how they will be offered for sale.  There will be a special collector’s run of no more than 50,000 sets in the 95% copper content, but nothing more on the common 97.5% zinc content.

Nor is there any requirement to mint a certain minimum number of coins.  That’s at the discretion of the US Secretary of the Treasury.  From Section 302(b)(2) of the Presidential $1 Coin Act of 2005:

NUMBER- The Secretary shall prescribe, on the basis of such factors as the Secretary determines to be appropriate, the number of 1-cent coins that shall be issued with each of the designs selected for each calendar quarter of 2009.

At the moment, there is a surplus of cents available for recirculation, as people have been raiding their piggy banks and heading to the bank or the Coinstar machine to raise funds.  Hence, there’s no need to mint more right now, as there is still widespread acceptance of exchanging them for face value.

The cost issues associated with minting the cents are real.  Managing public perception of the coins and currency is a delicate art: as minting the cents becomes more and more of a loss, the public receives clearer and clearer signals that not only doesn’t a cent buy much, it’s worth more storing it away than spending it.

For the meantime, though, metal prices are lower than they have been, so the Mint might be able to get away with minting larger quantities of the new cents.  They’d certainly like to; all of these novel designs are money-makers for the Mint.  (That wording was clear, right?)  But, it’s not their call how many they produce.

In any case, if only half a million of each design end up in circulation, they’ll be rare indeed.

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