Sunday, January 23, 2011

These are "fun" facts?

Some of them aren't even facts!

I had a good laugh reading the Wikipedia article on coin clipping - trimming the edges off gold and silver coins - when a line about people being executed for coin clipping was attributed to a page of "US Mint fun facts."

If having the life snuffed out of you for debasing the currency isn't enough fun, one of the next items on the link claimed the country profits by stamping more and more coins. This is neither fun nor a fact. The official government website reads:

The whole country makes money when the Mint makes money... Why? The answer is "seigniorage"—the difference between the cost of making a coin and its face value. (For example, it costs only a few cents to make a quarter, yet its face value is 25 cents.) This profit runs the Mint and puts extra funds into the country's Treasury—funds then spent on education, health care, defense, and other services for the nation.

Let's pretend that the country spends all its money on "services for the nation" and not boondoggles, bailouts and bureaucracy. Let's ignore that. If it's so profitable to make coins, why don't they end all taxes and just mint coins?

Clearly - clearly- it's because money is not wealth, it just stands in for it, and the value of bills and coins in the hands of the public is sapped when hard currency is increased faster than the resources and wealth it stands for. This is not rocket science, it's Inflation 101.

And why would the US Mint want to remind the public that seigniorage exists. Sure, a quarter only costs 10 cents to make, but a penny costs 1.6 cents and a nickel costs 7.7 cents. If quarters are profitable, doesn't that make pennies and nickels a liability?

To be fair, for all I know the higher ups at the mint want to stop making pennies and its the ignorant public that forces them to keep stamping them out. Still, how the word "profit" got in there is beyond me.

I'd imagine you'd have to be a pretty bored little kid to cruise the US Mint children's section when you could log onto The Alcohol and Tobacco Tax and Trade Bureau kids-only section. But does the ATTTB have a spunky cartoon rat mascot? No, no they don't.


  1. I read somewhere that the US Mint already has a mascot, Peter the pet eagle that was stuffed upon death, but I got that from an unreliable government fun facts page.

  2. What they actually make money on is coins taken out of circulation by collectors.