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Letters to the Editor (December 18, 2018)

Mint does not distribute coins to local banks


It never ceases to amaze me that even the most seasoned and esteemed numismatists do not understand how United States coinage goes from manufacturing to circulation.

In Harvey Stack’s Viewpoint column (Nov. 18, 2018), he blamed the U.S. Mint for problems with the distribution of the 50 State Quarters program. In his article, Stack wrote that “the distribution of the new designs did not get full nationwide distribution. The Mint sent to most banks nationwide whatever they had available, with some districts getting large quantities of the new issue and other districts getting relatively few, if any.”

The U.S. Mint does not distribute circulating coins to any United States bank except for the Federal Reserve. At the end of every production line is a two-ton bag made of ballistic materials that collect every coin produced on the line. When the bag is full, it is sealed and later transported to a processing center designated by the Federal Reserve.

The U.S. Mint is a manufacturer. When they complete making the product, it is packaged in bulk and the customer, the Federal Reserve, picks up the product. Once the product is delivered to the client, that product’s distribution is no longer in the U.S. Mint’s control.

During the time of the 50 States Quarters program, the U.S. Mint had an agreement with the Federal Reserve to distribute the new coins first in order to get them into circulation. When the new coins were transferred to the various Federal Reserve cash rooms in the 12 districts, the Federal Reserve did circulate the new coins first.

What gets left out of the discussion is the logistics of transferring the coins from the cash rooms to the banks. The Federal Reserve does not deliver. Like many government agencies, the Federal Reserve relies on contractors to carry out that job. The Federal Reserve “sells” the coins to the logistics companies that bag and roll the coins and eventually deliver the coins in armored vehicles to the banks.

In order to save money, these logistics companies keep their own supply of coins. This supply comes from the Federal Reserve cash room operations or excess they are given from the banks. Since the logistics companies were not part of the deal that the U.S. Mint made with the Federal Reserve, a bank that asked for a delivery of quarters may have received quarters from the logistics company’s stock rather than new issues from the Federal Reserve.

Logistics is the coordination of complex operations, and it is the job of these logistics companies to fulfill the inventory needs of the bank in the most efficient manner possible. It was more efficient to supply the banks in less densely populated areas with coins from current stock than transporting large amounts of coins from one of the Federal Reserve cash room operations that may be hundreds of miles away.

The U.S. Mint may do many things that collectors might take exception to, but the distribution of circulating coins is not their responsibility.

Scott Barman
Rockville, Md.

Jump out of the stock market and into CC coins

Thought I would run this by you as I am a fan of all CC coins.

Are they generally a good investment as far as rarity goes in comparison to the other mints? I realize there are some dates that are really hard to find in high-end coins. I am sort of new to this and have liquidated all my IRA stock holdings to acquire silver and gold coins.

John Troike
Address withheld

Editor’s note: Carson City Mint coins are popular among collectors because of the story of the mint itself. There are common issues and rare issues from this mint. Prices depend on quality and scarcity. Generally speaking, markets have been stable in the last couple of years. You have the time to study these issues and make the decisions to buy or not buy when you are ready.

If you are looking for quick in and out plays, these coins will not do well for you. If you are thinking of 10 or 15 years, then you have a chance to make a profit. The rules of diversification apply to coins as well as other asset classes. Putting all of your retirement money into one thing is not a good idea.

I hope you are approaching this with the idea of being a collector and having some fun with it. This approach usually yields the best results over time.

70-point grading not fully used; why adopt 100?

I have been observing the debate in Numismatic News about the pros and cons of a new 100-point coin grading system. At first I thought the 100-point system would be a good idea – sounded simpler, like the decimal system. But after reading George Kissinger’s letter to the editor in the Nov. 6th NN, I was inclined to agree with him – the coin collecting community does not even make full use of the current 70-point system. He’s right, in my experience.

At the numerous shows I’ve attended over the past 30 years, for raw coins in lower grades, one sees G4 and G6, VG8 or VG10, F12 or F15, and on up to AU50 – just a couple of grade breaks per category. So for the most part, the number grades in between are useless. Even when I tried putting together a Washington quarter set in BU, I mainly saw raw coins in cardboard flips above AU50 confined to AU55 and AU58. No AU51 or AU52, no AU56 or AU57. Even today, most Mint State grades go MS60. MS63, MS65. Above MS65, it’s anybody’s guess at the real quality.

Only in the grading of raw Morgan and Peace type silver dollars does it seem there’s much regular use of grades like MS61, MS62, and all the way to MS68 or perhaps MS70. The pressure for a 100-point system seems to be on the high-end Mint State third-party graded coins. On a 100-point system, they can have more grade breaks in MS, and the pricing can go up with every single point. So why not just let them have 40 grades between MS60 and MS100, and there’s your 100-point system?

David Smith
Somerville, Tenn.

Prices of slabbed tokens make no sense

When McDonald’s had their 50th Anniversary Big Mac token release earlier this year, I drove around to five or six McD’s locations to get all five. So my cost is $25 plus gas. (I ate one Big Mac with each purchase!) People have until, I think it is, the end of the year to redeem the token for a free Big Mac. I’m thinking of keeping mine as a souvenir or a collectible.

I just looked on eBay, and my mind is boggled. Had I gotten the five still-in-the-cellophane tokens graded at what cost I don’t know, they are going for $75 and up.
This is crazy. I just don’t understand why getting these tokens graded makes them worth so much more. As if people are going to counterfeit the tokens for a $5 Big Mac. I’d rather have them in the original packaging along with the tiny card inside. I’ve watched Antiques Roadshow enough to know packaging is almost everything, or really makes a significant difference in pricing.

This is just crazy. You have to get McDonald’s tokens graded, pay for that grading, for people to see value in them. Maybe there’s some truth in what other readers say in that today people buy the holder and not the coin.

OK, so other people don’t think the same way I do, but I really think this is crazy.

Please ask your readers for comments. Could be they’d rather collect real coins anyway and not commercial McDonald’s tokens.

Name withheld

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