Monday, March 25, 2013

Plugging the Nickel

The nickel is not something one gives a great deal of thought. Rarely the stuff of animated conversation, our little noticed five cent coin has lately come under scrutiny of the government bean counters.

The nickel has been found to be UNPROFITABLE.

It costs the mint more than a nickel to make one. And it takes a lot more than one cent to make a penny. But though the penny may well disappear from the US coinage lineup, this is less likely for the nickel. Would the public really allow prices to round up to the next dime?

And besides, the US nickel has had a fascinating history. At minimum, pretty darn interesting, especially if you are a coin collector.

Here are some fine points.

  1. The first American nickel was NOT a five cent coin. In fact, it was a penny. First struck in 1856, the nickel one cent coin was actually called a nickel by the public because that was the metal used in its fabrication. The coin was alloyed with copper, but was of a pale whitish color. Sometimes these pennies were called white cents.
  2. The first five cent coin was NOT a nickel. It was a tiny silver five cent coin known as a half dime. In fact, the half dime of 1792 was the first US coin authorized by Congress, and reputedly was made from silver from the George Washington household. This last bit is somewhat controversial, but in the mean time the story has become something of a legend.
  3. The five cent nickel, and those first nickel alloy pennies, were not the only nickel coins made by the US Mint. There were also a whole series of three cent nickel coins made just after the Civil War to replace the small, tattered fractional currency notes printed and circulated during the hostilities.
  4. The Liberty Head Nickel series, struck from 1883 to 1912, was touched by scandal at its beginning and end. The first coins of 1883 did not have the word CENTS anywhere on the coin. The large Roman numeral V (for the number five) was thought to be sufficient to indicate the value of the coin. However, a nickel is almost the same size as a five dollar gold piece, which is also adorned with a Liberty head. Soon unscrupulous opportunists were gold plating the new nickels and passing them off as five dollar gold pieces. Just before the Liberty Head nickel series was replaced in 1913, some enterprising, though less than honest, mint workers ran off five specimens of the Liberty Head nickel dated 1913, now among the most valuable of American coins.
  5. And the term Plug Nickel? It is another way of saying worthless. Coins made of silver and gold were sometimes altered by cheaters who installed a lead plug into the center of coin, saving the precious metal removed for themselves. The coin so altered was worth substantially less. As the nickel was not made of valuable material to begin with, to say something was worth not a plugged nickel was to say it was worth not much at all.

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