Replacing Dollar Bill With Dollar Coin?

Canada Kills the Penny

In related news, Canada kills their penny:

http://www.canada.com/business/Budget+Penny+pinch+Canada+phase+copper+coin/6381984/story.html

...

NDP MP Pat Martin, who said he has tabled four private members bills since 2005 aimed at getting rid of the ``nuisance coin,'' said it costs 1.5 cents to manufacture each penny.

``Making cents hasn't made sense for a long time,'' said the parliamentarian, who said his next crusade will be against the nickel.

Canada isn't the first country to pinch its pennies. Australia removed its one- and two-cent coins from circulation in 1992, the United Kingdom pitched the half-penny in 1984, and after getting rid of its one-agora coin in 1991, Israel followed suit in 2008 with the five-agorot coin.

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I'm too cynical to believe losing the penny is the right decision.

Everything would get rounded up. I just don't believe in the benevolent business owner who would risk losing a few cents on a transaction by rounding down. Especially places like Wal Mart with such a thin profit margin.

And if prices get rounded up, then who gets the extra money? State? County? City? Business?

I do like the idea of dollar coins. Even two dollar coins.
 
SwiftLives said:
I'm too cynical to believe losing the penny is the right decision.

Everything would get rounded up. I just don't believe in the benevolent business owner who would risk losing a few cents on a transaction by rounding down. Especially places like Wal Mart with such a thin profit margin.

And if prices get rounded up, then who gets the extra money? State? County? City? Business?

I do like the idea of dollar coins. Even two dollar coins.
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Pricing doesn't change, only the currency is being withdrawn. Anything can still be priced in penny increments, only the totals have to be rounded to the nearest nickel and only when paying with cash. Many retailers already have give-a-penny/take-a-penny containers at the till to facilitate the annoying $10.01 transactions.
 
flopticalcube said:
Pricing doesn't change, only the currency is being withdrawn. Anything can still be priced in penny increments, only the totals have to be rounded to the nearest nickel and only when paying with cash. Many retailers already have give-a-penny/take-a-penny containers at the till to facilitate the annoying $10.01 transactions.
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So if I pay with cash for something that's $9.99 including tax, what happens to the penny I'm owed?

(Realistically, I'd say "meh", but those pennies can add up over time.)
 
SwiftLives said:
So if I pay with cash for something that's $9.99 including tax, what happens to the penny I'm owed?

(Realistically, I'd say "meh", but those pennies can add up over time.)
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It will be rounded up to $10.00, just like the retailer will eat the penny if its $10.01. If you are really concerned about your penny, pay by credit or debit card.
 
flopticalcube said:
It will be rounded up to $10.00, just like the retailer will eat the penny if its $10.01. If you are really concerned about your penny, pay by credit or debit card.
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I suppose I'm just cynical, but what would stop the retailer from rounding $10.01 up to $10.05? Or changing all prices so that the most common and profitable purchases round up? I'm more concerned about the implications of this over the long term, rather than per individual purchase. The larger chains (i.e. walmart) stand to profit from this the most, assuming they keep the extra money.

As for using a credit/debit card - switching to an all-electronic currency has some advantages, too. At least until the machines decide to take over. :)
 
SwiftLives said:
I suppose I'm just cynical, but what would stop the retailer from rounding $10.01 up to $10.05?
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Nothing to stop them except public vigilance. I would suspect perpetrators would be found out fairly quickly.
Or changing all prices so that the most common and profitable purchases round up? I'm more concerned about the implications of this over the long term, rather than per individual purchase. The larger chains (i.e. walmart) stand to profit from this the most, assuming they keep the extra money.
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I suspect it would be difficult to arrange pricing like that since spending patterns vary so much from purchase to purchase. Given that most items cost more than $1, a penny or two adjustment here and there won't count for a whole lot.

As for using a credit/debit card - switching to an all-electronic currency has some advantages, too. At least until the machines decide to take over. :)
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As long as I'm still in the Matrix, I won't care. ;)
 
flopticalcube said:
Nothing to stop them except public vigilance. I would suspect perpetrators would be found out fairly quickly.
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Ideally, you're right. I just think public apathy will win out. At least until some media exposé outs the company. Then they'll make some big public splash about changing their ways which will last until media furor dies down.

Seriously - I'm a lot of fun at parties.

I suspect it would be difficult to arrange pricing like that since spending patterns vary so much from purchase to purchase. Given that most items cost more than $1, a penny or two adjustment here and there won't count for a whole lot.
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Most companies track purchases. Grocery stores with loyalty cards, for example. I'm sure it wouldn't be too hard for them to find the most popular items or the most popular combinations and do some very subtle price manipulation. A few pennies up or down.

Granted, by the time any of this was ever implemented, cash might be even less popular.

I will admit that I *hate* carrying around pennies. The idea of doing away with them certainly has merit. I just believe that someone dishonest somewhere will find a way to exploit it and make/take even more money off of us.
 
It is purely a psychological thing that we don't round. We rationalize better with the lower prices. $9.99 on the surface just sounds so much cheaper than $10, but we all know the reality. The lower price just appeals to our sense of good judgement better.
 
the "inflation" argument is flawed, and clearly done by people who have not worked retail.

Retail prices are structured to attract customers before taxes are added.
the majority of anything that is now -for example- 9.99 would be 9.95 rather than 10.00, because they want to maintain the perception that you are 'saving a dollar' and are thus more likely to buy.

merchants are not going to round-up if it means losing sales on the extra cent, which it would to some extent.

say that the $9.99 item brings $2.99 profit. by increasing the price to $10.00 the profits skyrockets to $3.00/item. But if even one customer decides not to buy the item because of the now-hefty $10.00 tag, then you need to be selling over 300 items for the price-hike to start bringing in the extra profit.
 
After living in the UK, I must say I'd actually carry 'cash' again if the $1 coin gained wider acceptance. I've always liked them, but shops don't give them as change so I never receive any.

The change just makes sense. :cool:
 
SwiftLives said:
I just believe that someone dishonest somewhere will find a way to exploit it and make/take even more money off of us.
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I don't think it matters all that much. A store can just raise the price of 'whatever" from $10.00 to $10.05 arbitrarily now if it wants to. What's stopping them from completely ripping you off is the competition. If the prices are generally cheaper across the street, guess where most people will shop?

The store owner that rips everybody off loses business in the end. Customers will eventually go somewhere cheaper; doesn't matter if the total was improperly rounded up (it'll be on the receipt), or the price was listed a few cents higher intentionally.

Retail competition is ultimately our protection from this kind of fraud.

Don't know what to tell you about the electric company doing this, though… :(
 
Catching up on my podcasts today, I listened to this very thorough story from the guys at Planet Money (which is always worth a thread resurrection).

Some highlights: dollar coins would have an annual cost of .05¢ per year per dollar while notes are .06¢, but the Federal Reserve would have to release 50% more coins because they have a documented effect of staying in jars, in the couch, etc. This makes their effective cost .075¢ per year.

Other countries that switched to dollar coins or their equivalents have notes that wear down faster. The old Canadian $1 note had a circulation life of only 1 year, while the $1 US bill lasts 4.5 years. That's a big part of the reason why it made more practical sense for other countries to switch.
 
CalBoy said:
Other countries that switched to dollar coins or their equivalents have notes that wear down faster. The old Canadian $1 note had a circulation life of only 1 year, while the $1 US bill lasts 4.5 years. That's a big part of the reason why it made more practical sense for other countries to switch.
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Just wait 'till your pocket gets heavy with coins, and you actually have to use extra time and effort to get rid of them.

Now add a $2 coin to that mix, like we already have.

And there's talk of a $5 coin in the future too. I pray it's ****ing tiny, and not like a luncheon plate.
 
iJohnHenry said:
Just wait 'till your pocket gets heavy with coins, and you actually have to use extra time and effort to get rid of them.

Now add a $2 coin to that mix, like we already have.

And there's talk of a $5 coin in the future too. I pray it's ****ing tiny, and not like a luncheon plate.
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Thankfully, the perpetual dysfunction that is Congress will probably kill the bill to end the $1 note, because it's just too popular and it's an election year. ;)

I can't imagine the pain of a $2 coin. Actually, I can, because I remember my irritation with the €2 coin and the £2 coins. A completely superfluous denomination, which never left my pocket. I'd buy a chocolate-covered Flake or a croissant with one of those things, hoping to be rid of it, only to get MORE coins back.

Although I guess there's a bit of deterrence built in for robbieries; every person is carrying a small armory of dense projectiles, which have also conveniently provided enough annoyance to make their owners generally irritable and aggressive enough to use them. :eek:
 
Perhaps the wide spread embrace of the dollar coin will help stimulate sales in the coin purse industry?
 
CalBoy said:
I can't imagine the pain of a $2 coin. Actually, I can, because I remember my irritation with the €2 coin and the £2 coins. A completely superfluous denomination, which never left my pocket.
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Sis and I were just discussing this on the phone.

It occurred to me that when we kill the penny, that approximate size will be available again.

So I figure a penny-sized $5 coin, with the thickness of a loony/toonie.

IMO this would actually work. :)
 
Malaysia had a dollar coin in wide circulation 15 years ago. Can't find any today - they are back to bills instead.
 
I wouldn't be in favor of changing from the $1 bill to a coin. I just don't want to keep up with change.
 
iJohnHenry said:
Sis and I were just discussing this on the phone.

It occurred to me that when we kill the penny, that approximate size will be available again.

So I figure a penny-sized $5 coin, with the thickness of a loony/toonie.

IMO this would actually work. :)
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It looks like Ottowa is aiming for the novelty market first:

http://news.nationalpost.com/2012/04/09/new-quarter-features-glow-in-the-dark-alberta-dinosaur/

The image of a dinosaur whose remains were discovered in Alberta’s Peace Country will be featured on our newest quarter — the first Canadian coin with a glow-in-the dark picture.

The quarter, being released by the Royal Canadian Mint April 16, features Pachyrhinosaurus lakustai, a large herbivore whose bone fragments were discovered by Grande Prairie, Alta., science teacher Al Lakusta in 1974.
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CalBoy said:
It looks like Ottowa is aiming for the novelty market first:
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They are all over that trick like a dog on a bone.

Sell coins for more than face value, knowing they will never see circulation.

Hell, circulation quarters no longer even contain any silver. :mad:

Thank you for the permanent use of your money. ;)
 
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