Jul 19, 2008 | BEP, currency, video
I went to see my orthopedist on Friday for a post-operative check up. While the visit went well, the office building where he is located is a very long walk from the front door to the elevator. Rather than make this my Friday to get my new iPhone 3G (I still want one) I have been recovering from that shlep.
While surfing the Internets, I was looking for interesting video. Other than the usually list of follies, viral videos, and cuts of previous on air performances (“needs more cowbell!”), I found something numismatic I wanted to share.
The Bureau of Engraving and Printing calls this B-Roll video of the printing of the new $5 notes. “B-Roll” is a television term for background video that is interspersed with another story. It received its name from the days of editing video segments on film where the primary story with the reporter talking was on the “A” or primary roll of film while the background information was on the B-Roll. The term has survived through the video and now digital era. Eventually, it is placed in the archive and later called “stock footage.”
If you are interested, you can find the B-Roll information in the Media Center on the BEP New Money website.
Apr 17, 2008 | cents, education, video
As the venerable Lincoln Cent marches to its one hundredth anniversary in 2009, there has been a lot of talk about the one year designs and whether the coin will continue its production in 2010. But we cannot forget that it is still the backbone of commerce.
The following video was made for the Boston Herald by Ted Ancher for a story he had written. The video is a narrated slide show talking about the Lincoln cent with the “Battle Hymn of the Republic” playing in the background on a loop. Enjoy!
Feb 24, 2008 | coins, grading, video
Here in the United States, it is common to see coins encased in holders by third party grading services whose label includes that service’s opinion of its state of preservation. We have slabbed everything, from the most worn large cent to the American Eagles just received in the mail from the US Mint. There is even a service that grades the graders by placing a sticker on the holder to say that this service agrees with the opinion of the original grader.
Coin grading is less common outside of the United States. For example, in Canada, collectors who want coins graded sends them to the US-based services or use the Toronto-based International Coin Certification Service (ICCS). ICCS encapsulation offers a different type of encapsulation that includes a small certificate with the coin. But an informal scan of Canadian coin dealers show that the US-based services dominates the grading of Canadian coins.
We’ve accepted coin grading. Overseas collectors have not. They reject coin grading for the reason most of my collection is not graded: there is something satisfying about holding that key coin in my hands. But with the rise in counterfeit of key coins and the raising interest in US coins outside of the US, some collectors are looking to slabbed coins to ensure they are purchasing genuine products. Or are they?
There are a finite number of key coins and there is enough anecdotal evidence that suggests the grading population of key coins has reduced. To maintain their viability, the top tier grading services have to look for additional outlets for revenue. These services are expanding their brands into grading currency, sports cards, and even special labels for modern coins. Expanding into grading world coins for the collectors outside of the United States may be an attempt to find new markets. It appears that the next untapped market is grading world coinage for non-US collectors.
This is not lost of Professional Coin Grading Services President Ron Guth. PCGS, a subsidiary of the publicly traded Collectors’ Universe (NASDAQ: CLCT), may be trying to use the international market as a way to expand PCGS‘s market.
Recently, Guth spoke with Numismatic News Editor Dave Harper at the World Money Fair earlier this month in Berlin, Germany, and file this report:
From this interview it is difficult to say whether the international market is ready for PCGS or any third-party grading service’s service. It appears that this will be one of the “let’s wait and see” issues.
Feb 11, 2008 | cents, coins, nickels, US Mint, video
CBS News’ ubiquitous weekly news magazine, 60 Minutes, broadcasted a report on Sunday that discussed the costs of producing cents and nickels (see embedded video below). According to the US Mint, over 8 billion copper-coated zinc cents were produced ($80 million) costing the Mint $134 million to produce. Producing 1.3 billion nickels ($65 million) made with the .75 copper alloy that has been in use since 1866, and cost $124 million.
Should We Make Cents?
Source: CBS News
Mint Director Edmund Moy, who was interviewed for the report by Morley Safer, said that the costs were a direct result of the rising metal prices. “You know, coins are made out of metal,” Moy said. “And worldwide demand for copper, nickel and zinc have dramatically increased over the last three years. That’s what’s primarily driving up the cost of making the penny and nickel,”
Stephen Dubner, the co-author of the bestseller Freakonomics, puts the penny in the same category as your appendix and other useless relics. “It’s just not useful,” Dubner said. Unfortunately, Dubner may not have heard that researchers may have found that the appendix does have a useful function.
The focus of the report was to look at the economics of continuing the production of Lincoln Cents. While the report mentioned the tradition of the cent and the coin features Abraham Lincoln, probably the country’s greatest president, and the 2009 redesign program, the argument about removing these coins from circulation are based on their economic worth. But if they are useless and have no value, then why is there a demand for these coins being produced?
I have previously explained that the Mint’s primary “is to produce an adequate volume of circulating coinage for the nation to conduct its trade and commerce.” To carry out this mission, the Mint distributes coins to the Federal Reserve System banks and branches as necessary. Regardless of the cost of production, is it really necessary for the Mint to produce so many cents for circulation?
Unlike commemorative or other collectible items, the number of business strike coins distributed is determined by the individual Federal Reserve banks. As the need arises, the Federal Reserve banks place orders with the Mint for coins to distribute to the nations banks. From those banks, coins are circulated to the public through business or teller operations. Although there are some stockpiles of under used coinage (mostly halves and dollars), the Mint uses “just-in-time” inventory management and distribution like many other manufacturing facilities. Thus, productions of business strikes are based on the demand created by the ordering practice of the various Federal Reserve banks.
If the cent is obsolete and economically infeasible with little buying power, then why is the Federal Reserve ordering so many for circulation?
How Cents are Made
Source: CBS News
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