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Monday, May 12, 2014
Nickels are a hedge against inflation
This is an interesting one.
According to www.coinflation.com, the metal that composes a nickel (75% copper and 25% nickel) its worth slightly more than five cents (face value).
As inflation gets worse, I can only imagine that the price of copper and nickel will increase.
Not too long ago, I remember some story about some guy that bought 20 tons of nickels.
Keep in mind, it is illegal to melt down legal tender. However, if it becomes too expensive for the government to make nickels out of the current composition, they may start to make nickels out of something cheaper like zinc.
Most coins used to be made out of silver. In fact, pennies used to be mostly made out of copper until 1982. Today, pennies are made out of mostly zinc.
Speaking of which, each penny (1982 or before) is worth 2 cents (as of 5/12/14).
As these pennies get phased out of circulation, its possible they may gain some sort of numismatic value.
So, if you can't afford gold or silver, stock up on these nickels and pre 1982 pennies.
Don't coinstar them.
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