Article Categories

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Useful Links

 
PCGS

NGC

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Like all Other Dollar Coins the New Presidential Dollar Coin Will Also Fail


If you have not heard by now, the US mint (actually a congressional act mandates the production of these coins) is at it again. On February 15, 2007, a new US dollar coin will be put into circulation. Will it circulate? I have my doubts. It’s not that I don’t want it to. Just take a look at the history of the dollar coin, and you can see, like all previous dollar coins, this one has an uphill battle. This article will attempt to identify all the reasons why this dollar coin, like all dollar coins before it, will fail. For an opposing view, please see my other article titled “Unlike Previous Attempts This Time the Dollar Coin Will be a success”.

If you really look at the history of the dollar coin, going all the way back to the beginning of dollar coin, they have generally not been accepted by the public. Yes, even the Morgan Dollar was shunned by most people during its run and was not a popular coin to collect until the 1960’s when silver exceeded its face value.

Probably the most shunned dollar coin of all was the Susan B. Anthony Dollar. Highly criticized by the public for being nearly the same size of the quarter, the coin never gained acceptance. The Mint, recognizing the public opinion regarding size, did nothing and instead with the next dollar coin (Sacagawea), changed the color with a different metallic content to make the coin appear gold in color. After a brief time in circulation, the coin was just plain ugly as it would appear tarnished in color. So now we have another gold color coin in the Presidential Series. The Mint has changed things slightly to reduce the discoloring effect. But that will not matter.

As previously mentioned, the American public seems to just not want a dollar coin, whether that be a coin nearly the same size a quarter or for that matter, any size. While changing the color certainly helps to avoid confusion, it is still easy to confuse the two under certain circumstances (while the coins are in your pocket or you are in the dark). If the dollar coin was the same size as the old dollar coins (Eisenhower and before), it would have an even tougher time in circulation. Can you imagine buying a pack of gum with a $5.00 and getting four IKE dollars back? Your pocket would not last long.

With a US Dollar bill in circulation, and no plans to remove it, the public will simply revert to old habits and continue to use paper dollars to transact business. Take a look in your wallet/purse. Chances are that you have several $1 bills in there. Do you want that many dollar coins instead? OK, you might change your spending habits to circulate dollar coins, but then maybe not. Did you know the US government spends around $500 million a year on producing $1 bills and that a $1 bill only lasts 18 months or so in circulation? A metal coin can last 30-50 years.

What good is a coin, if a vending machine cannot take it? While some vending machines (think post office stamp machines) take dollar coins, they are few and far between. Even with the cost of most vending items at or over $1.00, our habit is to stick in a $1 bill for our sugar fix. I simply do not see the vending industry making a mad dash to modify existing machines to accept dollar coins unlike when there was a rush for vending machines to accept $1 bills. Did you know that most vending machines will take a $2.00 bill? Many of them will not show it, but they do. I’ll bet you did not even know that the $2.00 bill was still made. Yes, it is. Also the cost of parking well over a dollar, most parking meters do not take dollar coins, at least not where I park. Why not? It would sure be easier to put in a couple dollar coins instead of 8 quarters.

Sadly, a fair number of Americans do not even recognize some of our currency. Next time you go to your local fast food restaurant or department store, give the clerk a half dollar or a dollar coin and pay close attention to the reaction you get. Most retail clerks do not even recognize the coins. Really, try this. I am serious. If you can find a bank, S&L or credit union that has any, get a few rolls and try to spend them. I do this for fun quite often with half dollars. The retail clerks typically will ask me what they are. Some have asked me if they are dollar coins (the half dollar). Others have told me they cannot accept foreign coins. Every so often, a clerk will get excited and ask me if I have anymore thinking they hit the mother lode with some rare and valuable collectable. How can the US Government expect a coin to circulate when the very people who dispense and accept change do not even recognize them?

The biggest reason that I have not used any dollar coins is that I simply I do not ever get them in change. This is the biggest reason why this coin will fail. Retail outlets are the biggest distributor of coins into the hands of the public. If retail outlets do not issue the new dollar coins in change, then how are we expected to use the coin? It’s really quite simple; I can only put back into circulation what I receive. Many retailers will use the excuse that there are not enough change slots in their cash drawer (maybe eliminate the penny?). This is the same excuse for the lack of circulation of the half-dollar. Actually, there is an unused slot in most cash drawers but they are often used for storage of coin rolls, etc. Regardless, if American retailers do not distribute the new dollar, it is destined to fail. Even if retailers do distribute the new dollar coin, will you as a customer simply ask for paper dollars instead? That gets back to an earlier point, and that is, with a dollar bill in circulation, making change for a $5 will still be $1 bills.

I think the new dollar coin will be popular, but it will not circulate. What do I mean? The State Quarter program brought in a new generation of collectors. Collecting the new dollar will be popular. It may even bring in a new generation of collectors, or it will reinvigorate collectors who started with the quarter program. With the quarter program nearing the end in a few years, the dollar coin is just what those collectors need to keep their interest. The coin though, will just not circulate well enough for widespread use.

As Always, Happy Collecting.

Keith Scott has been a collector for over 30 years. His website has US coins for sale. He also writes Coin Collecting Articles for fun. Visit his websites for a history of US coins, metal market updates and news about your favorite coins.


Want to discuss the Presidential Dollar?  Join my coin forum.

Coin News

Subscription expired
RSSbox powered by rssinclude.com