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Feb 04, 2013  |  Vote 0    0

Demise of the penny: Making sense of a Canadian change

London Community News

If Dr. Sheldon Cooper were Canadian, his notoriously annoying knocks would soon go unheard.

The fiendishly popular phenom physicist and main character of the sitcom The Big Bang Theory is known for knocking three times quickly, saying the name of the person whose door he’s rapping and repeating until he’s answered.

His favourite target has always been his neighbour across the hall: Penny.

With the official phase-out of the one-cent piece taking effect this week, London Community News generated a number of concerns the Royal Canadian Mint may not have considered.

What effect will the loss of the penny have on the price of a thought? How much are Canadians willing to spend on a well-borne wish? Will lucky pennies become even more precious, or lose their magic altogether?

We took to the streets of downtown London looking for answers.

Bill Merkley has been in the collectables business for 37 years, the past 23 in his store, London Coins and Collectables on Talbot Street in downtown London.

He said he has been selling 2012 pennies “by the box,” about two a week, since the announcement.

In the run-up to Christmas he sold 50 boxes (50 rolls each) of the lucky little guys.

“A lot of people think they can’t spend them anymore, but that’s not the case,” he said. “Some are rushing to cash them in but you’ll be able to spend them forever. They aren’t being demonetized.”

The first British large copper penny was struck in 1797. The first Canadian penny was struck in Britain in 1858, and has featured five different tail-side designs since. The current "maple twig" design has been used since 1937 with the exception of Canada's centennial in 1967.

Over 35 billion pennies have been minted in Canada since 1908. Stacked up, they would stand taller than 99,000 CN Towers. Side-by-each, they could circle the globe 16 times and would weigh almost as much as two Titanics.

Asked whether the penny would become more valuable as a collectible now that it is officially out of production, Merkley replied any penny older than 1996 already is. That’s the year the government started making them out of steel or zinc in place of the more costly copper.

“You can still melt them down and make more than a penny,” he said, adding it’s a service he offers.

The Vaughn family of St. Thomas spent part of their frigid Friday (Feb. 1) off school skating at the Rotary Rink outside Covent Garden Market.

They were specific about what they were willing to pay for wishes and aggressive in their thought pricing.

“It depends on the wish,” said Graham.

His sister Stephanie agreed: “It would depend on what circumstance I was in.”

“People would be more willing to throw away their pennies (in a wishing well),” said mom Hillary. “It’s a very good point.”

She added fundraisers her kids take part in through school such as the Penny Car and Jump Rope for Heart, could someday be impacted.

The kids agreed that a “nickel” or “dime” for your thoughts just didn’t have the same ring to it.

That’s when things got out of hand, with the theoretical price hyper-inflating past loonies and toonies right to $5.

“Well, (the price of) things are gonna go up now because they won’t have anything under five cents,” Graham said.

“They’ll round up, they won’t round down,” Hillary added.

Actually, the government is encouraging businesses to round up or down to the nearest five-cent increment: one and two cents would round down to zero, three and four up to five, six and seven down to five, eight and nine up to 10.

Cori Burns said he would charge a dime for a thought in post-penny Canada.

“I’d say a dollar for a wish.”

Carly Westman works at Smith Cheese in the Covent Garden Market. She said immediately her thoughts would be worth a nickel.

“I’d do a dime" for a wish, she said. “Because I see them next to pennies in wishing-wells all the time.”

She said as pennies become more rare, they couldn’t help but become luckier.

And it’s worth noting she is the only person to tell London Community News she would give away a thought for free rather than up-charge.

That, dear readers, is customer service.

Lucky or not, halting the production of pennies makes good business sense, according to the federal government, which announced the phase-out in its 2012 Economic Action Plan.

“Excessive and rising cost of production relative to face value, the increased accumulation of pennies by Canadians in their households, environmental considerations, and the significant handling costs the penny imposes on retailers, financial institutions and the economy in general” all contributed to the decision.

The government estimates taxpayers will save $11 million per year as a result.

Professional blogger and digital marketing specialist Melissa Dawn Lierman (@TimeOutMom on Twitter) has been collecting coins for her three children since they were born.

She said her parents were amateur coin collectors and passed the bug on to her. The business owner understands the economic case but lamented the loss of the penny.

“I have always collected coins, American and Canadian, for my kids,” she said. “They always get coins as part of their Christmas and birthday presents. I love the history they represent.”

Lierman said she uses coins to teach her children about money and math.

“We were just counting pennies today to bring to the dollar store,” she said. “We counted what we could get with our coins.”

As for Lierman’s pricing: “My thoughts have always been a quarter” she smiled, missing nary a beat.

“I’m expensive.”

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