Comment: Not – Abolish US Cent Penny

Not – Abolish US Cent Penny

(c) Leo G Campbell       8/26/2017

Not – Abolish US Cent Penny

My Comment:

My university degree, is a B.A. (Batchelor of Arts) in Economics. I have studied the US economy, also Russia, Canada, former Yugoslavia, and others. I have much graduate work, toward an MBA (Master of Business Administration).

The US Treasury/US Mint should not find an excuse to abolish the US penny, or cent. There are several serious economic reasons to maintain the cent, as US legal tender.

With every change in presidential administration, somebody – bureaucratic or politician – sees that the cost of stamping out copper cents is just a bit more – than 1 cent in value.

Not as simple as that – who determines the actual, real value – of one cent? Me? You? Them? Good questions.

Under US currency law, each 1 cent – comprises 10 parts, or 10 mills. Mills play a part in quoting US retail gasoline prices – which are quoted everywhere in “dollars, cents, and mills.” Example: gas priced as $2.47/9 is $2.47 plus 9 mills.

Mills are still used in real estate and elsewhere, to compute real estate taxes.

The point is, if the US cent is deleted, a complete revision of retail and real estate, is required for such a deletion to work, and to avoid economic chaos.

Another serious problem, is the retail public’s – the retail business sector’s – greed reaction.

Note: “The Greed Factor” applies to all human enterprises. Rather than a “TGF’ it is “TFG”… the factor greed…

If there is no 1 cent, the millions of items, from candy bars to perfumes, that are priced at $0.57 or $24.98, have to change, because price must round to the nickel, the 5 cent piece.

Does the business round prices down? No – the greed factor rules that prices will ALWAYS be rounded UP. The $0.57 candy bar price will increase to $0.60, the three cents’ increase – is a 5.2% increase to the consumer. The $24.98 perfume reprices to $25.00 – a 8.0% increase to the consumer. Carried across the entire USA retail economy, there could be an immediate national retail inflation, of at least 5%. The disruption to the USA business economy could trigger recession, or worse.

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