The U.S. Mint circulated more quarters, dimes, nickels and pennies last year. And that’s a good thing.
When the economic crisis hit a few years ago, people turned to one of the most traditional safe havens for savings: piggy banks.
(MORE: Will Tensions With Iran Really Push Gasoline to $5 a Gallon?)
“People went into their piggy banks and their coin jars and spent those coins,” U.S. Mint Deputy Director Richard Peterson told NPR’s Planet Money. “Those coins flowed back into the banks and then ultimately back to the Federal Reserve. The Federal Reserve started filling up and they turned off the spigot of new coin production from the United States Mint.”
But last year, coin shipments from the Mint finally increased — by 37%, which means that less people are digging around their own homes for dimes and nickels. Not surprisingly, gold and silver coins were also extremely popular as many Americans looked to precious metals as a more stable investment. Gold and silver collector’s coins were actually the largest source of revenue for the U.S. Mint last year. More than 45 million ounces of them were sold in 2011, which was about a 30% increase, a record spike.
(MORE: Inside the Fed’s Vault: $1 Million of Unused Coins)
But even though many Americans were still concerned enough about the economy to buy up gold and silver, the increase in circulating coin production was a promising sign. What’s not so promising is that it now takes the U.S. Mint 2 cents to make a penny and 10 cents to make a nickel, according to the Mint’s annual report. (The Mint says it’s looking into ways to reduce these costs.)
More bad news for the mint: the recent announcement by the White House that the Congressionally mandated presidential dollar coin program would be discontinued. There was little to no demand for many of the coins, but the Mint was forced to make them anyway. However, even though very few sold, the ones that did sell actually made a little money for the Mint: the coins cost 18 cents to make and were sold for $1. But overall, axing the program is slated to eventually save the federal government $50 million.
Even without the presidential dollar coin program, the Mint still plans to be in the black this year. And any of that profit will go to paying down the national debt.
