Yes. Canada stopped producing pennies in the fall of 2012. [0] The sky didn't fall. There was no great debate, no public opinion polls and politicians swearing heartily about the demise of our great nation. (Ok that's probably not true. For too many politicians that's all they do.) There was resistance when Canada dropped the $1 bill in favour of a Loonie (a $1 coin with the image of a loon on it). People bitched abo…
The lower the stakes, the harder the fighting, and a penny is as low a stake as there is. https://en.wikipedia.org/wiki/Sayre%27s_law >Sayre's law states, in a formulation quoted by Charles Philip Issawi: "In any dispute the intensity of feeling is inversely proportional to the value of the issues at stake." By way of corollary, it adds: "That is why academic politics are so bitter." Sayre's law is named after Wallac…
Is It Time to Kill the Penny?
81–90 of 428 posts
Re: Is It Time to Kill the Penny?
#82I really like it that they offer you, instead of a site with a lot of junk and JS, a plain text version! That's much nicer news than the story itself :-) ... that said - why _don't_ you guys cancel the penny? > Penny defenders' strongest argument was that eliminating it would hurt consumers. All those $9.99 products? The prices would be jacked up to an even $10! That sounds like an argument made up retroactively to t…
Where I'm from, shops started using .95 pricing _long_ before the idea of scrapping 1c and 2c coins was raised, purely because handling those coins wasn't worth it.
A key difference is that we have VAT, which is built into the price, rather than a US-style sales tax, which is not. In the US, if you're handling cash you still have to deal with 1c and 2c coins because of that. That made it easier for us to scrap 1c and 2c coins, but creates resistance for any US attempts to do the same.
One other thing we did was introduce symmetrical rounding rules on the final price of cash transactions: https://www.centralbank.ie/consumer-hub/rounding
Applying rounding was entirely voluntary, and all the Government did was gradually take the 1c and 2c coins out of circulation. After that, it was a matter of time for the problem to go away.
Re: Is It Time to Kill the Penny?
#83I’d rather we do a reverse split of the dollar - say 10:1 - 10 old dollars = 1 new dollar, essentially take us back to 1950’s pricing, coins become relevant again! + it has the added benefit of undoing all the changes in laws/refs that were not inflation adjusted. Not holding my breath...
If you think about it this way, it really does make a decent argument for switching larger denominations to coins.
Personally, I just use my debit card for everything and only use cash when the vendor specifically doesn't allow credit, which is increasingly rare with square and other methods of taking payment from a smartphone.
Re: Is It Time to Kill the Penny?
#84There is a much simpler solution. Obviously people want their "0.01" coin, so we should instead envalue the currency. Cancel the dollar, make dollar2.0 which is exactly 10 times as valuable and done. You eliminate everything below 10cents effectively, the metal industry is happy to supply material for new coins, coin collectors are happy to get new coins, banks are delighted to make a bit of profit skimming a few dollars off people's accounts when converting their currency in their databases, everybody[1] wins!
[1] for some fraction of "everybody"
Re: Is It Time to Kill the Penny?
#85Earlier quoted context omitted.
>> $0.01-$0.02 per transaction * millions of transactions per day has got to make some accountants happy. You'd think, but actually no. That's because it's per transaction, so the accumulated amount is well pennies compared to the turnover. For example, say you always rounded in favor of the company. That means an average of 2c gain per transaction. If you do 2 million transactions a day that's... 40 grand! yay. Exce…
This is similar to how HFT firms make a profit. Except it's generally less than a penny but it's per share per transaction (trade). We can thank the Sub-Penny Pricing Rule of Regulation NMS for this feature. An order for 1000 shares of XYZ stock that is front-run for half a penny per share is $50 dollars profit. Rinse and repeat.
>We can thank the Sub-Penny Pricing Rule of Regulation NMS for this feature
Are you sure? I did a quick search and came up with this
>One of the rules in Regulation NMS is a new Sub-Penny Rule: “which establishes a uniform quoting increment of no less than one penny for quotations in NMS stocks equal to or greater than $1.00 per share to promote greater price transparency and consistency. . . . In particular, Rule 612 addresses the practice of “stepping ahead” of displayed limit orders by trivial amounts. It therefore should further encourage the display of limit orders and improve the depth and liquidity of trading in NMS stocks.”
https://www.bloomberg.com/professional/blog/sub-penny-pricin...
which suggests the opposite of what you're claiming. Also, I'm not sure how you'd even make money this way, considering that NBBO requires brokers to execute their customer's trades at the best available price.
Re: Is It Time to Kill the Penny?
#86Earlier quoted context omitted.
Yes, nickles should definitely go. But since money is decimal, dimes make more sense. (10 cents exactly) But because of quarters you still probably need nickels. Or you could just go binary use halves, quarters and eighths.
> But because of quarters you still probably need nickels. Only in the presence of dimes. That's why I say, cut them too.
Good point. Binary money is ideal.
But you can get arrested (or shot if Black) for trying to spend a two dollar bill in America.
Man arrested for using $2 bills at Best Buy - clip from The Two Dollar Bill Documentary
https://www.youtube.com/watch?v=iS3yjfefUD8
A $2 Bill At Taco Bell
https://www.youtube.com/watch?v=tbp-UyLH2ng
Police Involved After Student Tries To Buy Lunch With $2 Bill
https://www.forbes.com/sites/kellyphillipserb/2016/05/04/pol...
Re: Is It Time to Kill the Penny?
#87Yes. Canada stopped producing pennies in the fall of 2012. [0] The sky didn't fall. There was no great debate, no public opinion polls and politicians swearing heartily about the demise of our great nation. (Ok that's probably not true. For too many politicians that's all they do.) There was resistance when Canada dropped the $1 bill in favour of a Loonie (a $1 coin with the image of a loon on it). People bitched abo…
I feel like we missed an opportunity to also drop the nickel and round everything to 10 cent intervals and just forget about the extra level of precision entirely. I imagine I will see this in my lifetime.
I know that it would be a bridge too far, but having worked at a business (movie theater) that had prices only ending in 0.25, 0.50, 0.75, or .00, I would love for the whole country to just have quarters and be done with it.
Though, since I rarely handle change at all — if I do use cash, I usually find the first place near my hand to donate whatever metal comes back to me - I suppose I’m not the target audience anyway.
Re: Is It Time to Kill the Penny?
#88Earlier quoted context omitted.
You should be able to pay with 1 and 2 cent coins in The Netherlands. You just won't get them as change and the amount charged will be rounded to the nearest 5 cents in most, but not all, shops. But I wouldn't be surprised if many cashiers don't know they should accept those coins.
Interesting. I've tried in quite a few places and never got them accepted.
Here is the government website that says so and its translation (with a really long url, but the translation is better than that of Google Translate).
Appearantly every shop should have stickers telling customers that they round cash payments. I've never noticed that anywhere.
https://www.rijksoverheid.nl/onderwerpen/geldzaken/vraag-en-...
https://www.deepl.com/translator#nl/en/%20Mogen%20winkeliers....
Re: Is It Time to Kill the Penny?
#89There's a list of countries which have removed their smallest denomination coins on Wikipedia. https://en.wikipedia.org/wiki/Cash_rounding
For one political party in the US, the fact that other countries have done it is considered proof that it is an anti-American idea.
Re: Is It Time to Kill the Penny?
#90Yes. Canada stopped producing pennies in the fall of 2012. [0] The sky didn't fall. There was no great debate, no public opinion polls and politicians swearing heartily about the demise of our great nation. (Ok that's probably not true. For too many politicians that's all they do.) There was resistance when Canada dropped the $1 bill in favour of a Loonie (a $1 coin with the image of a loon on it). People bitched abo…
> Since Canada changed but left the taxes the same (14% in Ontario IIRC) there seems to be a lot of rounding-off in favour of companies instead of consumers. $0.01-$0.02 per transaction
This assertion is wrong. If the item you buy is $1.00, then after your 14% tax it will be $1.14, which is rounded up to $1.15. If the item is $2.00, then after tax it is $2.28, which also rounds up to $2.30. But if the item is $3.00, then after tax it is $3.42, which rounds down to $3.40. If the item is $4.00, then after tax it is $4.56, which rounds down to $4.55.
Secondly, the rounding to nearest nickel is done per transaction, not per item. So if you go to a supermarket and pick up 3 items costing exactly $1.00, then the total you owe is $3.42 (which becomes $3.40 in cash), and it is that amount that is subjected to rounding, not the individual items (which are $1.13 and would round to $1.15).
I live in Toronto and have analyzed my retail receipts. (I'm aware the HST is currently 13% but that's not relevant to this argument.) The rule about rounding to the nearest nickel is sensible enough, but I've witnessed various weird behaviors. For example, each vendor has a different kind of wording to show how they rounded your cash transaction. Some use a negative sign to show that the penny rounding deducted money from your total owed, while some use a negative sign to show that the penny rounding increased your total owed (as if you paid negative money). Also, a few vendors always round down to the nearest 5 cents (to appear nice to the customer), which causes a surprise when I'm trying to prepare the correct amount of change. Finally, some vendors don't display cash rounding on their receipts, so for them it is an oral culture that isn't formally written down.