Get Rid of the Penny

[Remiel]

There is an extra cost in the transportation of coins over notes to be considered, but I am not sure how significant it is. Perhaps negligible. The thing is though, if its good for the $5, why note the $10, $20, $50 and $100? I mean, imagine trying to transport a suitcase with $10,000,000 in $100 coins. It would weigh ~750 kg!

[August1991]

There is an extra cost in the transportation of coins over notes to be considered, but I am not sure how significant it is. Perhaps negligible. The thing is though, if its good for the $5, why note the $10, $20, $50 and $100? I mean, imagine trying to transport a suitcase with $10,000,000 in $100 coins. It would weigh ~750 kg!

Small denominations get used more often. It makes more sense for them to be metal. A paper five cent bill would be in tatters in a matter of weeks but a $100 paper bill can last for years. Paper is obviously much cheaper to produce.

[M.Dancer]

I just can't help think that deleting the penny will be inflationary.

Like the cut in GST was supposed to save us 1%......I have yet to hear of a retailer who didn't up his retail price 1% ........

[geoffrey]

Like the cut in GST was supposed to save us 1%......I have yet to hear of a retailer who didn't up his retail price 1% ........

5 cent candies are still 5 cents .

Factually, inflation was down (not deflation, lower inflation) after the GST change. To be honest though, I'm not sure if Statscan calculates GST in the inflationary numbers.

[M.Dancer]

Like the cut in GST was supposed to save us 1%......I have yet to hear of a retailer who didn't up his retail price 1% ........

5 cent candies are still 5 cents .

Factually, inflation was down (not deflation, lower inflation) after the GST change. To be honest though, I'm not sure if Statscan calculates GST in the inflationary numbers.

yes and the $5.61 pint of domestic is still $5.61..even after the 1% solution...but come the penny devolution, it will surely be 5.65

[Charles Anthony]

but come the penny devolution, it will surely be 5.65

-- not if you refuse to pay it.

Our beer and popcorn are sold on a market. That means, if you are unhappy paying the extra 4 cents to round up the price, you are providing an incentive to a competitor to gain your business by rounding down.

Answer this: why the hell does everybody post prices with $X-insert-digits-here-X.99 instead of using round numbers??? It does not follow your logic.

[M.Dancer]

but come the penny devolution, it will surely be 5.65

1)-- not if you refuse to pay it.

Our beer and popcorn are sold on a market. That means, if you are unhappy paying the extra 4 cents to round up the price, you are providing an incentive to a competitor to gain your business by rounding down.

2)Answer this: why the hell does everybody post prices with $X-insert-digits-here-X.99 instead of using round numbers??? It does not follow your logic.

1) Except just about everyone will raise the price, and no one will hunt for a 4 cent savings

2)Only large ticket items are sold that way...sort of....like Dell offering notebooks for $999 flat....and even then, the old school/old wives psychology behind the 4.99 is so much not 5.00 is becoming passe.....

see the loblas flyer for an example....while some things are price XX.99....many are priced XX.29 or .49

The pressure will push the price up.....

http://www.loblaws.ca/en/this_weeks_flyer.asp

[Charles Anthony]

1) Except just about everyone will raise the price, and no one will hunt for a 4 cent savings

Then, why do you think people quote prices at XX.X9?

[M.Dancer]

1) Except just about everyone will raise the price, and no one will hunt for a 4 cent savings

Then, why do you think people quote prices at XX.X9?

It supposed to be psychological. Without the penny though....it will proven to be just a gimmick

[Charles Anthony]

It supposed to be psychological. Without the penny though....it will proven to be just a gimmick

-- gimmick or not, what would YOU do if you were a retailer and the penny disappeared?

[Riverwind]

It supposed to be psychological. Without the penny though....it will proven to be just a gimmick

-- gimmick or not, what would YOU do if you were a retailer and the penny disappeared?

Give my customers a break and _always_ round down (i.e. forgo up to 4 cents in the name of making customers happy).

[Charles Anthony]

Give my customers a break and _always_ round down (i.e. forgo up to 4 cents in the name of making customers happy).

Exactly. I believe most retailers will do the same. Getting rid of the penny is not a consumer problem.

In fact, maybe retailers will start quoting $xx.95 for their prices more and more. Just a guess.

[August1991]

If Pat Martin gets his way, you'll never again have need of a penny. The NDP MP for Winnipeg Centre is drafting a private member's bill to discontinue the use of the one-cent coin.

"We think the time has come to put the penny to rest," said Martin. "They weigh a ton, they're a nuisance, and they've lost their purchasing power."

According to Martin, it costs almost six cents to produce a penny. The Royal Canadian Mint in Winnipeg would save $30 million a year if it stopped stamping out the copper-coloured coin.

People keep them in a bucket under their beds," said Martin, adding there are approximately

20 billion pennies in circulation in Canada -- or about 600 for every Canadian.

Link

Hear, hear.

$30 million annually is enough to house decently 3000 now homeless people.

[Michael Bluth]

What to do with the money saved by canning the penny can be decided at some point in the future.

I have no doubt that the penny costs more than one cent to produce, but six cents?

[cybercoma]

Give my customers a break and _always_ round down (i.e. forgo up to 4 cents in the name of making customers happy).

If a business does 4000 transactions in a day (large ones like WalMart probably do about that if not more), at $0.04 per transaction that's $160.00 loss per day. Even if it's not $0.04 every time, that's still probably around $100 per day, $700 per week, $2800 per month and $8400 per quarter.

I can't see that happening for some reason.

[Riverwind]

Even if it's not $0.04 every time, that's still probably around $100 per day, $700 per week, $2800 per month and $8400 per quarter.

Statistically speaking the 'loss' is 1.4 cents per transaction or $54 per day. They would also only do it for cash transactions - credit/debit transactions would still use the exact pennies. Incidentally, businesses already pay much more than 1.4 cents/transaction for credit/debit transactions so I don't buy your argument that they would balk at rounding down.

I can't see that happening for some reason.

That is what happened in Australia when then eliminated their penny.

[dpwozney]

The penny is a nuisance and I have heard rumour that on occasion (when the CDdollar was in the toilet) the penny cost more to produce than it was actually worth, rated against other currencies.

However, that would mean the GST would have to go to 5% or 10%. Tax earnings calculations and all those other goodies would have to all be taken to only the first decimal. Still, it could work, but it means a massive, across the spectrum standardization, that will require either incredible teamwork or untold billions of dollars in gov't expenditure.

What is your definition of the value of the Canadian dollar?

What is the physical substance, the physical material, of the Canadian dollar? What is the physical manifestation of the Canadian dollar in the material universe?

Has any government in or of Canada ever defined the value of the Canadian dollar?

[M.Dancer]

What is your definition of the value of the Canadian dollar?

What is the physical substance, the physical material, of the Canadian dollar? What is the physical manifestation of the Canadian dollar in the material universe?

Has any government in or of Canada ever defined the value of the Canadian dollar?

Governments can try to value their currency, but in the end the markets determine the value of the dollar or the lira or pound.

What is the physical substance, the physical material, of the Canadian dollar? What is the physical manifestation of the Canadian dollar in the material universe?

The physical manifestation of the dollar is the exchange of goods or services for the currency. The substance or material are irrelevant. It is a promisary note, and as such it matters not whether it is on a napkin of bondstock.

[dpwozney]

The physical manifestation of the dollar is the exchange of goods or services for the currency.

Are you stating that a Canadian dollar is a physical good or service? If so, what physical good or service is one Canadian dollar?

The substance or material are irrelevant. It is a promisary note, and as such it matters not whether it is on a napkin of bondstock.

What promise is made by whom to whom?

[M.Dancer]

Are you stating that a Canadian dollar is a physical good or service? If so, what physical good or service is one Canadian dollar?

What promise is made by whom to whom?

Are you by any chance, "a freeman"?

No I'm not saying it is a good or service. I already said it is a promisary note whose value is determined by the markets. If you (the buyer) and another (the seller) agree that one dollar is worth 2 minutes of electrical work, then that's the value. If the currency traders agree that the dollar is worth .96 US cents, then that's the value.

The promise is of course made by the Bank of Canada, and the promise is that it is legal tender. They don't promise what they can't, only that it will be honoured. For instance, you could say that if I work for 10 hours on your home, you will give me a promisary note equal to my labour. If I agree, that's fine. But chances are I can't take your note across the county and find a grocery store that will accept it as tender. If you pay me in legal tender, it will be accepted everywhere canadian notes are taken and the value will be consistant. In other words $10 in a bank in BC will not be called $5.00 in Nova Scotia......

.

[fellowtraveller]

Radio-Canada

In preparation for the Vancouver Olympics, it was suggested that we replace the $5 bill with a coin. Since coins last longer than paper money, this would save the government printing costs and the savings would be used to help Canadian athletes.

In Europe, the smallest paper denomination is 5 euros (worth almost $8 Canadian) and in the UK, the smallest paper bill is 5 pounds (worth about $10 Cdn).

----

I have a different idea. I think we should simply abolish the penny. With inflation, the Canadian one cent isn't worth anything anymore. They're a hassle to count, and unload from purses and pockets. The Mint has to produce and ship rolls of the damn things. Shops and banks have to keep them and count them. Thousands of shopclerks across Canada are counting the damn things everyday. For what? All prices should be rounded up to a nickel.

I think the UK used to have a half-penny that disappeared long ago. Before the euro, the smallest coin in Germany was a five pfennig coin, I think. Ours would be the nickel.

You have a different idea?

This suggestion has been in the Candian domain for at least ten years, and I posted Pat Martins proposal over a month ago here as an OP.

Australia of course did abolish the penny several years ago.

[dpwozney]

No I'm not saying it is a good or service. I already said it is a promisary note whose value is determined by the markets. If you (the buyer) and another (the seller) agree that one dollar is worth 2 minutes of electrical work, then that's the value. If the currency traders agree that the dollar is worth .96 US cents, then that's the value.

The promise is of course made by the Bank of Canada, and the promise is that it is legal tender. They don't promise what they can't, only that it will be honoured.

Are you stating that a Canadian dollar is a Bank of Canada note? If so, which Bank of Canada notes are the value of one Canadian dollar?

A merchant is not required to honour Bank of Canada notes.

Bank of Canada notes state: “This note is legal tender”. This Bank of Canada web page provides the following answer for the question “What is ‘legal tender’?”:

“A ‘tender’ is an offer of payment of a debt. In Canada, legal tender consists of coins issued by the Royal Canadian Mint and bank notes issued by the Bank of Canada.

This does not mean that a merchant is obliged to accept bank notes. The method of payment can be whatever is mutually acceptable to both parties - cash, credit card, cheque, etc. Thus, a merchant may refuse to accept bank notes in payment for goods or services, without contravening the law.”

[White Doors]

Did you have some sort of point to make or are you just trying to impress us?

[M.Dancer]

Did you have some sort of point to make or are you just trying to impress us?

I don't know but I think it's time to check the Alcan stock price .......which as you know is listed in dollars.

What does the fact that someone is not forced to accept Canadian currency have to do with anything? I don't recall saying they had to?

Freeman.......single source of aluminium shortages in Canada, followed by 9.11 truthers.....

[dpwozney]

What does the fact that someone is not forced to accept Canadian currency have to do with anything? I don't recall saying they had to?

You stated: “The promise is of course made by the Bank of Canada, and the promise is that it is legal tender. They don't promise what they can't, only that it will be honoured”.

The Bank of Canada does not promise that legal tender will be honoured.