RoR: Forum

They say that it is just a beginning, that one day soon Utah might mint its own coins, that retailers could have scales for weighing precious metals and that a state defense force could be formed to guard warehouses where the new money would be made and stored.

Article 1, Section 10 of the Constitution says no state shall coin money, though Mr. Hilton and some others argue that a phrase used later, saying no state shall “make anything but gold and silver coin a tender in payment of debts” can be read as a license for Utah’s new law and, perhaps, for a state’s right to mint its own coins.

Article 1 Sec 10 is explicit. "No state shall ... coin money ..." Even I cannot see a way to argue around that, but maybe the Mormons are better at scriptual interpretation.

"... emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; ... "
Prevents the states from creating their own paper money.

No State shall enter into any Treaty, Alliance, or Confederation; grant Letters of Marque and Reprisal; coin Money; emit Bills of Credit; make any Thing but gold and silver Coin a Tender in Payment of Debts; pass any Bill of Attainder, ex post facto Law, or Law impairing the Obligation of Contracts, or grant any Title of Nobility.
http://www.archives.gov/exhibits/charters/constitution_transcript.html

That said, it is perfectly legal for Utah to make gold and silver coins legal tender at at their nominal weight and fineness rather than as money of account.

The reason why is that when the Constitution was created and adopted (1789), there was no U.S. Mint. The first coins did not come until 1794-1795. The Federal government removed the legal tender status of foreign coins only 1857 -- and only for federal obligations such as import duties and land purchases. Spanish coins especially were the mainstay of commerce, though along the Eastern Seaboard many merchants kept their books in Pounds-Shilling-Pence even as they accepted US money, also, again, at least into the 1830s if not longer.

I have pointed here before to Spanish Coins on American Money. These private bank notes from Michigan, Alabama, Illinois and Indiana and other places into the 1850s show promises in "dollars" but pictures of reales.

Right now, at about $35-$40 an ounce for silver, a US Dime 1964-earlier is worth about $2.50 to $3, which is handy for a convenience store. Figure 7/10 ounce to the dollar (0.72336) for a conservative estimate. You can fill your gas tank for four quarters.

Post 1

Monday, May 30, 2011 - 8:51am

Mike and Sam,

at about $35-$40 an ounce for silver, a US Dime 1964-earlier is worth about $2.50 to $3

Apparently a US dime made in 1964 or earlier was made of 100% silver. Assuming my assumptions below are correct ...

Up until which year was a penny made of 100% copper?

Up until which year was a nickel made of 100% silver?

Up until which year was a dime made of 100% silver? (I'm assuming the answer is: 1964)

Up until which year was a quarter made of 100% silver?

Up until which year was a half-dollar made of 100% silver?

Up until which year was a "silver dollar" made of 100% silver?

Please correct any wrong assumptions you find.

Ed

Post 2

Monday, May 30, 2011 - 4:24pm

Ed, they were never 100%.
US Standard is 90% or .900 or "900 fine."
The cut-off year is 1964. 1964 and earlier were 90% silver.

(From 1965-1970, the Kennedy half dollar was "clad silver" 80/20 silver/copper outer layers over a .791/.209 copper/silver core for a net value of 40% silver by weight.)

That was since about 1873. (Before that through 1838, they were .8934. If you care, you can find the ugly details online or buy yourself a Red Book. Anyone who has an interest in old US coinage needs a Red Book. You can find a prior year used cheap.) Also, the standard is:

half dollar 12.50 grams
quarter 6.25 grams
dime 2.50 grams

Again, before 1873, they had lighter weights, 6.22 grams for the quarter, etc.

Also, the Silver Dollar was struck to a different weight, though, again, from 1873- 1933, they were 90% silver. A dollar weighs 26.73 grams (not 25, as you might expect). The Dollar was the Standard by Law. The other coins were adjusted to be subsidiary conveniences.

(I won't get into silver 3-cent or 20-cent pieces, though for the theorist, they do offer some interesting considerations. Note that Proof issues are often 90% silver even today. I got an "impaired proof" in change a few years ago. I won't get into Half Cents, Large Cents or 2-cents. I won't get into the Trade Dollar or the Eisenhower.)

Cents were "French Bronze" since 1864: 95% copper; 5% tin and zinc combined. (There were "steelies" in 1943; and in 1944 "brass" from bullet casings was re-used). This was until 1982.

In 1982, in the middle of the year, the present alloy, 99.2% zinc with a 0.8% copper wash, was introduced. This coin weighs 2.5 grams.

With "copper" cents - which is the common name we all understand for French bronze, just as we call them "pennies" which they are not - the break even point is $1.59/lb for copper. For silver coins, it was $1.2929/ounce of silver.

The nickel was never silver - except as a propaganda ploy in WW-2 for 1942-1945, when they were 35% silver of their 5 grams weight. A standard nickel is 75% copper, 25% nickel.

Right now the cent is worth 2.7 cents and the nickel is worth 6.3 cents.
You can find the current melt value of US Coins here, at Coinflation.

It is against the law to melt nickels and cents or to export them. You can melt silver coins.

(Edited by Michael E. Marotta on 5/30, 4:46pm)

Post 3

Monday, May 30, 2011 - 4:51pm