Originally Posted by
crabbing
the federal reserve banks also generate a profit (returned to the US treasury), but mainly from interest on investments and services to commercial banks. currency storage is one of the primary functions of the FR banks. storage of dollar coins is an incremental and non-differentiable expense (current total coin stock is in excess of $2 billion).
Assuming the $2B is correct (and sounds reasonable to me) that's about $60M per Fed office (not just talking about the 12 Fed banks, but also the branches and remote vaults). Each $1k of dollar coins weighs about 20 pounds, so that's about 600 tons of coins per office, and I would assume that this is steadily increasing, and much more of a problem at Feds such as LA, SF, and NYC, not to mention ATL, DFW, CHI etc. The Fed has already alluded to this issue in public docs. I would expect that there are already backroom discussions (Mint, Fed, Congress) going on about this, and that it is only a matter of time (could be years, though) before either the dollar bill or the dollar coin deal go away.