Get Rid of the Penny

[Qwerty]

It probably is time to get rid of it but the retailers should have to bring their pricing in line to reflect that. All those pennies would add up over a year toa big company.

How are they doing it in Oz? Anyone know?

[dpwozney]

Next time ask the bank teller for twenties.

Today, I was in a financial institution building and I asked to withdraw one hundred dollars from my account. The teller asked me if wanted twenties and I said that whatever is one hundred dollars is fine with me.

She gave me five Bank of Canada notes each with the words “TWENTY” and “DOLLARS” written on them.

I said: “By the way, you know, these Bank of Canada notes, they don't claim to be dollars. They just have the word ‘DOLLARS’ written on them without claiming to be dollars. Like, if this Bank of Canada note is twenty dollars, then what is one dollar? Is one dollar one-twentieth of this bank note?”.

She said “Yeah, like you can't rip it up into pieces.”.

I told her that I would let it go today and that I won't make this an issue now. But then I said that next time, I don't know what I'll do.

[dpwozney]

I told her that I would let it go today and that I won't make this an issue now. But then I said that next time, I don't know what I'll do.

Today, July 22, I was in another financial institution building with a “Government of Canada” cheque payable to me. (Signatures appear on the cheque for the "Receiver General for Canada” and the "Deputy Receiver General for Canada”).

The cheque states:

“To/À”, and then my name and my street address, and then

“Pay/Payez SIXTY AND 50/100 DOLLARS

SOIXANTE ET 50/100 DOLLARS”.

I asked the customer service representatives: “If I sign and endorse this cheque here, how and with what would you pay me dollars?”.

They offered to pay me with Bank of Canada notes and RCM coins.

I explained:

(1) The Bank of Canada notes do not claim to be dollars. They instead just have the word “DOLLARS” written on them without claiming to be dollars;

(2) The RCM coins do not claim to be cents. They instead just have the word “CENTS” written on them without claiming to be cents;

(3) The Bank of Canada notes claim to be legal tender. Legal tender is not the same as dollars and cents. Financial transactions, that do not involve any legal tender, are claimed to be conducted in dollars and cents; and,

(4) Bank of Canada notes used to be promissory notes. Before 1969, they contained the phrase “WILL PAY TO THE BEARER ON DEMAND” and then some number (“ONE”, “TWO”, “FIVE”, “TEN”, “TWENTY”, “FIFTY”, or “ONE HUNDRED”) and then the word “DOLLAR” or “DOLLARS”. The dollar always used to refer to something real. For example, the dollar in North America used to refer to the Spanish dollar, a coin made mainly of silver. In 1969, the phrase “WILL PAY TO THE BEARER ON DEMAND” was simply omitted on new Bank of Canada notes but the word “DOLLAR” or “DOLLARS” was conveniently left on.

I asked the customer service representatives to prove that the Bank of Canada notes are dollars; they could not prove that the Bank of Canada notes were dollars.

Our discussion also involved the stated value of the dollar, the actual value of the dollar, the possible non-existence of the Canadian dollar, nickel metal as a monetary standard, the concept of paper bank notes backed by real physical assets, the present and past composition of RCM coins, and associated intrinsic values.

Anyways, at the end of our discussion, I left the building holding the “Government of Canada” cheque which I still have in my possession.

Edited August 21, 2008 by dpwozney

[M.Dancer]

Today, July 22, I was in another financial institution building with a “Government of Canada” cheque payable to me. (Signatures appear on the cheque for the "Receiver General for Canada” and the "Deputy Receiver General for Canada”).

The cheque states:

“To/À”, and then my name and my street address, and then

“Pay/Payez SIXTY AND 50/1000 DOLLARS

SOIXANTE ET 50/100 DOLLARS”.

I asked the customer service representatives: “If I sign and endorse this cheque here, how and with what would you pay me dollars?”.

They offered to pay me with Bank of Canada notes and RCM coins.

*snip*

Anyways, at the end of our discussion, I left the building holding the “Government of Canada” cheque which I still have in my possession.

I assume there is a typo and the cheque wasn't forged.

At what point do you expect them to bring in a doctor to help with your confusion?

[dpwozney]

At what point do you expect them to bring in a doctor to help with your confusion?

Just to ensure that everyone reading this is aware of some rules, the following quotes are excerpted from Forum / Weblog Rules:

“Please respect others using this board and treat them with respect and dignity.”

“Do not post inflammatory remarks just to annoy people.”

“Any messages that we deem unsuitable will be deleted or edited.”

[guyser]

Just to ensure that everyone reading this is aware of some rules, the following quotes are excerpted from Forum / Weblog Rules:

“Please respect others using this board and treat them with respect and dignity.”

“Do not post inflammatory remarks just to annoy people.”

“Any messages that we deem unsuitable will be deleted or edited.”

True , but read the fine print (you will have to enlarge your print to do so).....

“Please respect others using this board and treat them with respect and dignity.” ("that is if deserving of such respect, not applicable to tin foil hat wearing posters, and those who cant figure out what legal tender is")

[dpwozney]

True , but read the fine print (you will have to enlarge your print to do so).....

“Please respect others using this board and treat them with respect and dignity.” ("that is if deserving of such respect, not applicable to tin foil hat wearing posters, and those who cant figure out what legal tender is")

The Forum / Weblog Rules do not state your second quote in brackets, which is irrelevant anyways.

[M.Dancer]

I should have been more tactful. I should have asked at what point did they tell you to either leave or wait for security.

[guyser]

The Forum / Weblog Rules do not state your second quote in brackets, which is irrelevant anyways.

Gee...ya think?

[dpwozney]

I should have been more tactful. I should have asked at what point did they tell you to either leave or wait for security.

They did not tell me, at any point, to either leave or to wait for security.

[jammer]

They would also only do it for cash transactions - credit/debit transactions would still use the exact pennies.

That would be insane and severely cut down credit/debit transactions.

[William Ashley]

What about abolishing the penny and nickle, then minting new 5$ 10$ and 20$ coins with them - of course you better beleive they would be counterfited. Making it a decieme system instead of centieme.

How much does it cost to mint one coin? The only option would be to put a little RFID chip inside each one or something. With the owner of the coins being logged at each step of the way, and a special code inserted onto each coin to verify it that is a special code, that is decrypted with the serial on the front based upon a secret forumula that only the canadian mint knows, that is each mint day would be a seperate private key to match with the coin serial and the internal chip serial.

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.

Edited August 18, 2008 by William Ashley

[August1991]

What about abolishing the penny and nickle, then minting new 5$ 10$ and 20$ coins with them - of course you better beleive they would be counterfited. Making it a decieme system instead of centieme.

Forget about minting new coins, or absurd posters (Dwozney) claiming our money is being undernied.

I just want to be rid of the penny. We don't need it. The copper has better uses, and shopclerks should pay attention elsewhere.

(If you are a Quebec/Canadian nationalist, you will have the advantage of making a difference to eliminate our British penny compared with America and its Lincoln penny.)

[M.Dancer]

Bring back the twopence !!

[dpwozney]

I just want to be rid of the penny. We don't need it. The copper has better uses, and shopclerks should pay attention elsewhere.

RCM pennies minted from 1997 through 1999 are 98.4% zinc and only 1.6% copper.

RCM pennies minted since 2000 are 94% steel, 1.5% nickel and only 4.5% copper.

Edited August 21, 2008 by dpwozney

[August1991]

RCM pennies minted from 1997 through 1999 are 98.4% zinc and only 1.6% copper.

RCM pennies minted since 2000 are 94% steel, 1.5% nickel and only 4.5% copper.

Ok, so the zinc could have better uses (as well as all the time spent counting the damn things). If pennies were taken out of circulation, the copper in the old pennies would have better uses.

Meanwhile, has anyone noticed how 1996 or earlier pennies are now rare in your change?

[dpwozney]

Ok, so the zinc could have better uses (as well as all the time spent counting the damn things).

Do you believe there is a good chance the people at the RCM might mint pennies with 98.4% zinc and only 1.6% copper again?

Or do you believe people, in the future, might want to melt the 1997 through 1999 RCM pennies to extract zinc metal if they were allowed to?

This web page, “Canada Coin Melt Values”, lists a “Face Value” and a “Metal Value (USD)” for the “1997 - 1999 Cent” (which would be better labelled as “1997 - 1999 Penny”).

Edited August 21, 2008 by dpwozney

[dpwozney]

(1) The Bank of Canada notes do not claim to be dollars. They instead just have the word “DOLLARS” written on them without claiming to be dollars;

(2) The RCM coins do not claim to be cents. They instead just have the word “CENTS” written on them without claiming to be cents;

(3) The Bank of Canada notes claim to be legal tender. Legal tender is not the same as dollars and cents. Financial transactions, that do not involve any legal tender, are claimed to be conducted in dollars and cents; and,

(4) Bank of Canada notes used to be promissory notes. Before 1969, they contained the phrase “WILL PAY TO THE BEARER ON DEMAND” and then some number (“ONE”, “TWO”, “FIVE”, “TEN”, “TWENTY”, “FIFTY”, or “ONE HUNDRED”) and then the word “DOLLAR” or “DOLLARS”. The dollar always used to refer to something real. For example, the dollar in North America used to refer to the Spanish dollar, a coin made mainly of silver. In 1969, the phrase “WILL PAY TO THE BEARER ON DEMAND” was simply omitted on new Bank of Canada notes but the word “DOLLAR” or “DOLLARS” was conveniently left on.

Before 1969, Bank of Canada notes were not dollars, but rather, they were promises to pay dollars to the bearer on demand.

In 1969, merely removing “will pay to the bearer on demand” and adding “this note is legal tender” did not make Bank of Canada notes become dollars.

[Oleg Bach]

Damn those pesky pennies - they are useless - people have kilos of them in bowls and jars - at least when they were pure copper you could melt them down in the back yard and take them to a scrap dealer - now they are priceless...literally - liter.

[August1991]

The penny's days are numbered, says Canada's finance minister.

Jim Flaherty said Thursday it's just a question of when the country's one-cent coin is given the boot.

"I think it's inevitable that eventually the smaller coin - the penny - would be eliminated," he said from Peru, adding there are "different ways" to eliminate it and he looks forward to the results of an ongoing Senate study into the penny's future.

Currently, there are about 30 billion pennies in circulation in Canada, but the Royal Canadian Mint has to pump about 500 million new ones into circulation each year - at a cost of 1.5 cents per penny - because so many end up between couch cushions or in fountains or jars.

"What we are seeing is hoarding of pennies, so the Mint has to keep producing pennies at a cost of more than a penny," Flaherty said. "At some point, this will have to end."

Ottawa Sun

Sooner would be better than later.

[Topaz]

Just listen to the Senate committee on getting rid of the penny and by what was said, its going to be gone. There's a catch to this though. If you buy something that cost 1.13, IF you PAY cash you will pay 2 cents more. Put it on your interac, no extra charge, put on your credit card no charge until you pay your credit card payment and use cash. As the guy from the depart. of Finance said the government will get its GST first, if the business wishes to lower the price to 1.10, then he loses, so again we the consumers take the loss, if paying with cash. Australia got rid of their penny and when you go into a store you see a price and that is what you pay. They also talked about in the near future cash being gone and only interac or credit cards.

[August1991]

Topaz, you make two separate points here. Let's consider them in turn.

If you buy something that cost 1.13, IF you PAY cash you will pay 2 cents more. Put it on your interac, no extra charge, put on your credit card no charge until you pay your credit card payment and use cash. As the guy from the depart. of Finance said the government will get its GST first, if the business wishes to lower the price to 1.10, then he loses, so again we the consumers take the loss, if paying with cash.

Using your logic (and example), why doesn't the business simply raise the price for all buyers to 1.15? That is, if the seller can raise the price for people with cash, why not people paying with credit/debit too?

Heck, why would the seller stop at 1.15? Why not raise the price to 1.20 and go for the gusto.

It seems to me, Topaz, that you see buyers as victims/losers (perhaps because you are often a buyer). I bet that you consider sellers as victims/losers when, uh, you are a seller. IOW, you shift your argument to suit your particular position. Now, that may be perfectly human but it's also hypocritical, self-serving and inconsistent.

Australia got rid of their penny and when you go into a store you see a price and that is what you pay. They also talked about in the near future cash being gone and only interac or credit cards.

Would you truly prefer to have GST/PST/HST embedded/hidden in the price? That would be an invitation for governments to raise the tax at will. Who would know except those who read the fine print.

In Europe, where sales taxes (VAT) are hidden in the price, VAT rates are typically around 30% or so.

----

When it comes to taxes and democracy, I firmly believe that governments should send each of us a bill once every four years or so, payable on the same day that we vote.

Edited May 30, 2010 by August1991

[dpwozney]

It seems kind of silly to have spent decades minting billions of pennies only to end up stopping to use them.

If they had not debased the metal in coins, such as pennies, in the first place, they would not have had this problem of inflation and having to consider eliminating debased pennies.

[williat]

Topaz, you make two separate points here. Let's consider them in turn.

Using your logic (and example), why doesn't the business simply raise the price for all buyers to 1.15? That is, if the seller can raise the price for people with cash, why not people paying with credit/debit too?

Heck, why would the seller stop at 1.15? Why not raise the price to 1.20 and go for the gusto.

It seems to me, Topaz, that you see buyers as victims/losers (perhaps because you are often a buyer). I bet that you consider sellers as victims/losers when, uh, you are a seller. IOW, you shift your argument to suit your particular position. Now, that may be perfectly human but it's also hypocritical, self-serving and inconsistent.

Would you truly prefer to have GST/PST/HST embedded/hidden in the price? That would be an invitation for governments to raise the tax at will. Who would know except those who read the fine print.

In Europe, where sales taxes (VAT) are hidden in the price, VAT rates are typically around 30% or so.

----

When it comes to taxes and democracy, I firmly believe that governments should send each of us a bill once every four years or so, payable on the same day that we vote.

Very valid points. Clearly depending on what side of the argument you are on changes things drastically, the victim in this case could be the buyer or the seller, but clearly not the government. Topaz does raise some interesting points to build from however, I'm a Canadian who spends a large deal of time in Europe, they hardly use the 1 euro cent, I think I've only ever seen it in my pocket of change on 2 occassions. Clearly to circumvent the issue the seller would just have to round his pricing methods so that they reaced the nearest 5. But as August pointed out as well, whats to make the seller stop, I mean hell he could just raise the price enough infinitely, but this won't happen (namely due to competition models, demand vs supply, alternative products).

August also raises the idea of embedding tax in the price, again this seems to work in Europe (not that argument carries much weight anymore), and we already do this at government liquor stores. So why not just add the tax into the price, I mean I hate getting to the counter attempting to figure out if I have enough cash on my debit card to purchase everything I wanted to buy, then I have to think about tax, make life easier add it all together. If you honestly believe that it would be an "invitation for governments to raise the tax at will. Who would know except those who read the fine print." then thats for you to decide, but I would like to think that some Canadians would not be so ignorant that we could easily be trumped by this...I mean other countries might think we're those nice yet dumb Canadians, but you shouldn't also be saying it because if we start saying it, doesn't that make it true?

I very much like August's suggestion however to pay your taxes after 4 years on the day you vote. Very interesting idea really, but would it work. I would most certainly say that this would result it two problems, first people who want to avoid paying their taxes just wouldn't vote thus in a way rendering the vote undemocratic because well many people may not vote, secondly do we honestly believe that most Canadians would have enough disposible income after 4 years to pay taxes on the day they vote...I would be almost willing to guarantee that this wouldn't work, people struggle to pay rent each month and we want them to save for 4 years to pay taxes. What would happen then to tax returns? Would these be dealt with prior to the election, so that you know exactly how much (discounted) to pay on the day you arrive. Would the government then try to hedge for inflation claiming that the future value of the tax money (after 4 years) would be higher, therefore we should pay more? Like I said its a very interesting idea that I would like to hear more about, although I am skeptical that it would ever work.

[Topaz]

As it was pointed out by the senator to the department of finance answering the question, the 1.13 price, the government always get their money first, and the business wouldn't take a loss of 3 cents, so of course, the consumer would get the hit of 2 cents IF buying cash. The senator also said that it seems the Bank od Canada want people to use their interac and credit cards more than cash. BTW, you can always watch the videos on C-Pac to get a better understanding of this.