Thursday, February 11, 2010

Gresham's Law: Bad Money Drives Good Money Out of Circulation, or Why Nickels Are a Good Investment

Nickels are good money. There is 75% copper and 25% nickel in each "nickel". The government can't print nickels the way they can paper money.

According to Coinflation, there is 4.567 cents worth of metal in a nickel, right now.

Eventually, when the inflation comes, the metal value in a nickel will climb way over 5 cents. At that, point Gresham's Law will kick in and the coins will disappear from general circulation, but will be worth a lot more on the numismatic market.

LRC, today, has a nice link to one man's experience obtaining nickels from a bank.

Stockpiling nickels is one of the best investments going (if you have the storage space). You are protected against inflation, but if it doesn't come, you can just spend the nickels.

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