Pre-1982 US Pennies Worth 1.4 Cents In Copper/Zinc

[Tace]

Ashtray Outperforming My 401K

Alec Nevalainen -- Coinflation.com

Losing money making money. That sounds strange, but that's exactly what occurred when The United States Mint produced 95% copper/5% zinc cents in 1982. Material and production costs exceeded $0.01 to manufacture the cent and they changed the composition to 97.5% zinc mid-year (how they're still made today).

Now, the copper in the pre-1982 cent wasn't worth more than a cent at the time - it took 23 years for that to happen. On February 18, 2005 copper settled at $1.5126/lb and the pre-1982 copper cent had an intrinsic value of $0.01006437.

I thought the milestone was interesting, so I wrote an article titled, "Gresham's Law Returns." 321gold and PrudentBear published a link to it, but the response was little to none. It's only one cent, not exactly front-page news.

Fast forward to January 6, 2006 where copper settled at $2.1208/lb. To calculate the intrinsic value of the pre-1982 cent, use the following:

2.1208 (copper price per pound) x .0022046 (this value converts the copper price from pounds to grams) x 3.11 (gram weight of the copper cent) x .95 (percentage of copper in total weight) + .8849 (zinc price per pound) x .0022046 x 3.11 x .05 (percentage of zinc in total weight).


Do the math and you come up with $0.0141171. What does that mean? If you have 100 pre-1982 cents, you now have $1.41 in copper/zinc (40% gain in one year).

(more)

http://www.321gold.com/editorials/nevalainen/nevalainen011006.html

[sniffa]

1. i gotta sift through my change jar

i'm gonna get rich!!!!

[tinfoilinfor2005]

2. But the wheelbarrow you will have to carry it in

will eat up your profits. :)