Low mintages as far as eye can see

Just about every collector knows that mintages ran very high during the state quarter program. It was popular with collectors and it was noticed by the general population.

But just how high is high?

I decided to do a little bit of calculation this morning to come to a conclusion to that question.

During the 10 years (1989-1998) that preceded the state quarter program, the U.S. Mint produced 14.8 billion quarters. Now presuming that this 10-year stretch was a representative time and production matched just what the economy demanded, we can compare this number to the next 10-year period in which the state quarter program was conducted (1999-2008).

Any guesses as to the number of state quarters struck?

It was 34.8 billion.

Subtract the 14.8 billion total from the prior 10-year period and you get 20 billion extra quarters.

That’s a lot of extra quarters.

Was it all due to collector demand?

I doubt it.

Face value of all of those coins is $5 billion. That’s a bit much for the hard core hobbyists to save.

Where did they all go? Sooner or later most of them will return to circulation. Casual collectors and even some harder core hobbyists will give up and spend them. We’ve seen how this phenomenon works during the present recession.

Excess bags and rolls have been coming back to the economy whether because the owners have given up on hopes of profits, or whether personal hard times forced them to dump the coins for face value.

Beautiful examples of state quarters keep showing up in change, like the MS-68 2006 Nebraska quarter I received in change yesterday.

The fact that all of these quarters are coming back into use will depress the Mint’s current quarter output by quite a bit.

If normal demand is the decade prior to the state quarter program, it would take the economy 13.6 years to absorb the supply if the Mint didn’t make one additional coin.

However, stopping quarter mintages is not possible because we are in the first year of the America the Beautiful quarter program. Those designs must be produced.

The question is how many.

The first two designs total 128 million coins. If that rate of production continues, there will be 320 million quarters struck this year.

That depressed level of output could continue for up to 17 years, or more than the life of the America the Beautiful program, which concludes in 2021 with the 56th design.

Can quarter production stay that depressed for that long?

According to these numbers, it sure could – unless the government decides to pay off its debts with new quarters.