Buy Presidential Dollar Coins with CC @ Face Value, Free Shipping
Jul 7, 2009, 10:01 am
#2731
Join Date: Mar 2003
Location: Independence, MO USA
Programs: AA LT Gold & Marriott Gold
Posts: 275
How the coin system works
This primer only relates to the coin process and does not include all the functions of all the entities.
US Mint - manufactures coins for use in the US monetary system. As a side business it makes collectibles, medals, proof sets, etc. that they sell to customers for a profit. Helps pay for the Mint.
Federal Reserve (the bankers bank) - Receives coins from the mint and from member banks and supplies the banks with currency and coin. The act as a distributor and maintains an inventory of cash and coin.
The Banks are the Fed's customers and the retail outlet for money within our system. The provide a product, cash, by cashing checks, giving withdrawals of funds they hold in our accounts. They also have an inventory of currency and coin, which they need to balance quantity on hand to meet their customers needs. When they need pennies, nickels, etc. they order more from the Fed, when they have a currency or coin surplus, they send them to the Fed. Now we come in with our $1 coins, suddenly the bank doesn't need to get the $1 coins from the Fed, they get them from us. Now if they have a surplus they sell them back to the Fed. or use them for their customers.
One of the missions of the US Mint is to get the $1 coins into circulation. We are helping that mission by puchasing the coins, and some of us actually spend some. When we make deposits, some of those coins stay at the bank, and thereby get circulated. Some banks may ship all of them back to the Fed, but that's ok, as the US Mint has gotten them out of their vault and into the system. If you take in $5K and the bank uses $1K for change to their customers, we're helping the monetary system. I've been told by most of my banks that they always keep some $1 coins on hand for change and customer requests and that is good.
I read this thread each day and try to understand the different points presented. One of these days the program will probably end, not because of us, but the Mint will either stop the Direct Ship program or they will stop producing $1 coins when they feel the inventory in circulation is adequate. Their bigger problem is getting people off of the paper dollar bill.
I know this is a simple overview, but I felt that was all that was necessary to teach the basics of the process we are using. I hope the program continues for a long time, but who knows. Buy what you want, spend what you want, deposit what your want (with consideration) and take a nice vacation on your (almost) free miles.
US Mint - manufactures coins for use in the US monetary system. As a side business it makes collectibles, medals, proof sets, etc. that they sell to customers for a profit. Helps pay for the Mint.
Federal Reserve (the bankers bank) - Receives coins from the mint and from member banks and supplies the banks with currency and coin. The act as a distributor and maintains an inventory of cash and coin.
The Banks are the Fed's customers and the retail outlet for money within our system. The provide a product, cash, by cashing checks, giving withdrawals of funds they hold in our accounts. They also have an inventory of currency and coin, which they need to balance quantity on hand to meet their customers needs. When they need pennies, nickels, etc. they order more from the Fed, when they have a currency or coin surplus, they send them to the Fed. Now we come in with our $1 coins, suddenly the bank doesn't need to get the $1 coins from the Fed, they get them from us. Now if they have a surplus they sell them back to the Fed. or use them for their customers.
One of the missions of the US Mint is to get the $1 coins into circulation. We are helping that mission by puchasing the coins, and some of us actually spend some. When we make deposits, some of those coins stay at the bank, and thereby get circulated. Some banks may ship all of them back to the Fed, but that's ok, as the US Mint has gotten them out of their vault and into the system. If you take in $5K and the bank uses $1K for change to their customers, we're helping the monetary system. I've been told by most of my banks that they always keep some $1 coins on hand for change and customer requests and that is good.
I read this thread each day and try to understand the different points presented. One of these days the program will probably end, not because of us, but the Mint will either stop the Direct Ship program or they will stop producing $1 coins when they feel the inventory in circulation is adequate. Their bigger problem is getting people off of the paper dollar bill.
I know this is a simple overview, but I felt that was all that was necessary to teach the basics of the process we are using. I hope the program continues for a long time, but who knows. Buy what you want, spend what you want, deposit what your want (with consideration) and take a nice vacation on your (almost) free miles.
Last edited by gejone; Jul 7, 2009 at 11:32 am Reason: Edited to delete the reference to the Mint printing currency as mentioned by craz.
Jul 7, 2009, 10:05 am
#2732
Join Date: Oct 2006
Location: BUF
Programs: SPG Plt, HHonors Gold, UA Gold, PC Plat, Marriott Gold
Posts: 880
Thats why south americans were destroying the rain forest, or why poaching of endangered species is going on in africa. Everyone tends to consume in their best interest with disregard to the consequences
Jul 7, 2009, 10:06 am
#2733
Join Date: Mar 2009
Location: LAX
Programs: Mosaic 2, Bonvoy Gold, Hilton Diamond, Hyatt Globalist, Premium Cabin free agent
Posts: 848
AMEX charges the highest merchant fees. I believe it is 3.5% for our business. The US government would probably be lower because of their volume or maybe not because they are not concerned about the costs because it is taxpayer money that is funding the program. If anyone knows how much starpoints cost we could put two and two together. I am sure that AMEX is competent in pricing in the cost to do business with the US government including starpoints or MR points when they submitted their proposal.
Jul 7, 2009, 10:09 am
#2734
Suspended
Join Date: Nov 1999
Posts: 24,153
This primer only relates to the coin process and does not include all the functions of all the entities.
US Mint - prints and manufactures paper bills and coins for use in the US monetary system. As a side business it makes collectibles, medals, proof sets, etc. that they sell to customers for a profit. Helps pay for the Mint.
Federal Reserve (the bankers bank) - Receives currency and coins from the mint and from member banks and supplies the banks with currency and coin. The act as a distributor and maintains an inventory of cash and coin.
The Banks are the Fed's customers and the retail outlet for money within our system. The provide a product, cash, by cashing checks, giving withdrawals of funds they hold in our accounts. They also have an inventory of currency and coin, which they need to balance quantity on hand to meet their customers needs. When they need pennies, nickels, etc. they order more from the Fed, when they have a currency or coin surplus, they send them to the Fed. Now we come in with our $1 coins, suddenly the bank doesn't need to get the $1 coins from the Fed, they get them from us. Now if they have a surplus they sell them back to the Fed. or use them for their customers.
One of the missions of the US Mint is to get the $1 coins into circulation. We are helping that mission by puchasing the coins, and some of us actually spend some. When we make deposits, some of those coins stay at the bank, and thereby get circulated. Some banks may ship all of them back to the Fed, but that's ok, as the US Mint has gotten them out of their vault and into the system. If you take in $5K and the bank uses $1K for change to their customers, we're helping the monetary system. I've been told by most of my banks that they always keep some $1 coins on hand for change and customer requests and that is good.
I read this thread each day and try to understand the different points presented. One of these days the program will probably end, not because of us, but the Mint will either stop the Direct Ship program or they will stop producing $1 coins when they feel the inventory in circulation is adequate. Their bigger problem is getting people off of the paper dollar bill.
I know this is a simple overview, but I felt that was all that was necessary to teach the basics of the process we are using. I hope the program continues for a long time, but who knows. Buy what you want, spend what you want, deposit what your want (with consideration) and take a nice vacation on your (almost) free miles.
US Mint - prints and manufactures paper bills and coins for use in the US monetary system. As a side business it makes collectibles, medals, proof sets, etc. that they sell to customers for a profit. Helps pay for the Mint.
Federal Reserve (the bankers bank) - Receives currency and coins from the mint and from member banks and supplies the banks with currency and coin. The act as a distributor and maintains an inventory of cash and coin.
The Banks are the Fed's customers and the retail outlet for money within our system. The provide a product, cash, by cashing checks, giving withdrawals of funds they hold in our accounts. They also have an inventory of currency and coin, which they need to balance quantity on hand to meet their customers needs. When they need pennies, nickels, etc. they order more from the Fed, when they have a currency or coin surplus, they send them to the Fed. Now we come in with our $1 coins, suddenly the bank doesn't need to get the $1 coins from the Fed, they get them from us. Now if they have a surplus they sell them back to the Fed. or use them for their customers.
One of the missions of the US Mint is to get the $1 coins into circulation. We are helping that mission by puchasing the coins, and some of us actually spend some. When we make deposits, some of those coins stay at the bank, and thereby get circulated. Some banks may ship all of them back to the Fed, but that's ok, as the US Mint has gotten them out of their vault and into the system. If you take in $5K and the bank uses $1K for change to their customers, we're helping the monetary system. I've been told by most of my banks that they always keep some $1 coins on hand for change and customer requests and that is good.
I read this thread each day and try to understand the different points presented. One of these days the program will probably end, not because of us, but the Mint will either stop the Direct Ship program or they will stop producing $1 coins when they feel the inventory in circulation is adequate. Their bigger problem is getting people off of the paper dollar bill.
I know this is a simple overview, but I felt that was all that was necessary to teach the basics of the process we are using. I hope the program continues for a long time, but who knows. Buy what you want, spend what you want, deposit what your want (with consideration) and take a nice vacation on your (almost) free miles.
I cant EVER remember any Bank giving me even 1 $1 Coin as part of my Withdrawl, nor ever seeing anyone else getting any
The Mint does NOT need us to circulate them to the Banks probably alot faster and cheaper to have them brought there via the reg way that actual Money is sent around to/from them
and yes eventually it will come to an end but why hasten that happening
Jul 7, 2009, 10:10 am
#2735
Join Date: Jul 2004
Programs: CO, UA, AA, WN, DL Gold
Posts: 2,981
Jul 7, 2009, 10:17 am
#2736
Join Date: Mar 2009
Location: LAX
Programs: Mosaic 2, Bonvoy Gold, Hilton Diamond, Hyatt Globalist, Premium Cabin free agent
Posts: 848
Can you imagine a world where other countries couldn't rely on the US to do everything for them? Than you would have either a whole bunch of countries doing the same thing or the entire world speaking German and governed by a communist regime. I am totally sure you have thought of that and are perfectly willing to accept those consequences.
Jul 7, 2009, 10:23 am
#2737
Join Date: Sep 2007
Location: ROC
Posts: 139
Poker chips, travelers checks, etc are coded as cash advances, which means the merchant effectively pays no fee on the transaction; instead, some costs are passed along to the customer.
These coin purchases are coded as purchases, which means that the Mint is paying merchant fees on the transactions. As long as AMEX is getting paid by the Mint (and they apparently have been for over a year), they're happy.
Jul 7, 2009, 10:35 am
#2738
Join Date: May 2002
Posts: 667
I was once one of the idiots that brought in huge amounts in one deposit but changed my ways to very small deposits. I brought in a huge amount to deposit and later found out the poor teller had to unroll each roll and be put into bags. It took her about 3 hours to do it. This was at a BofA branch. I know this brings up red flags when they have tellers spend all that time processing coin deposits.
Just like every previous deal, it will be killed by the greedy like myself. I may have changed my ways but the majority will be stupid and be stay in the denial stage. I've been actually driving around to various branches and all the tellers in my area know what's going on because there's always someone who brags how many miles/cashback that they just got and want to share it with the world.
Come here to get your pat on the back, not from the teller, that has to put up with your 5K+ deposit of heavy coins.
Just like every previous deal, it will be killed by the greedy like myself. I may have changed my ways but the majority will be stupid and be stay in the denial stage. I've been actually driving around to various branches and all the tellers in my area know what's going on because there's always someone who brags how many miles/cashback that they just got and want to share it with the world.
Come here to get your pat on the back, not from the teller, that has to put up with your 5K+ deposit of heavy coins.
Jul 7, 2009, 10:39 am
#2739
Join Date: Dec 2007
Posts: 187
The answer lies in who is paying AMEX (and how much they're paying them).
Poker chips, travelers checks, etc are coded as cash advances, which means the merchant effectively pays no fee on the transaction; instead, some costs are passed along to the customer.
These coin purchases are coded as purchases, which means that the Mint is paying merchant fees on the transactions. As long as AMEX is getting paid by the Mint (and they apparently have been for over a year), they're happy.
Poker chips, travelers checks, etc are coded as cash advances, which means the merchant effectively pays no fee on the transaction; instead, some costs are passed along to the customer.
These coin purchases are coded as purchases, which means that the Mint is paying merchant fees on the transactions. As long as AMEX is getting paid by the Mint (and they apparently have been for over a year), they're happy.
ANSWER: POTENTIAL ABUSE!!!!!!!!!!!!!!!!!!!!!!!!
Jul 7, 2009, 10:52 am
#2740
Join Date: Sep 2007
Location: ROC
Posts: 139
Casinos have no desire to pay merchant fees on transactions, for obvious reasons. So those end up coded as cash advances.
The Mint is willing to take a "loss" when selling these coins, so it is coded as a purchase, with the Mint is paying merchant fees.
Jul 7, 2009, 10:55 am
#2741
Original Member
Join Date: May 1998
Posts: 1,139
The Mint has NOTHING to do with Paper Money thats the Bureau of Engraving and Printing. You cant mint paper only Metal objetcs
I cant EVER remember any Bank giving me even 1 $1 Coin as part of my Withdrawl, nor ever seeing anyone else getting any
The Mint does NOT need us to circulate them to the Banks probably alot faster and cheaper to have them brought there via the reg way that actual Money is sent around to/from them
and yes eventually it will come to an end but why hasten that happening
I cant EVER remember any Bank giving me even 1 $1 Coin as part of my Withdrawl, nor ever seeing anyone else getting any
The Mint does NOT need us to circulate them to the Banks probably alot faster and cheaper to have them brought there via the reg way that actual Money is sent around to/from them
and yes eventually it will come to an end but why hasten that happening
I agree with the distinction between paper money producer and coins, I disagree with your argument that the Mint doesn't want or need our help. Government and quasi-government agencies don't always like each other. The Mint has been directed to increase the curculation of the $1 coin since it will save the overall government money via less printing of the dollar bill.
Based on published reports by the Mint, the banking system has not been cooperating. Banks have not been ordering the $1 coin in the traditional manner you described. Banks do not want them, just like they didn't want the Susan B. Anthony dollar. The sales to consumers gets the coins into the banking system, a result that would not otherwise occur. Hopefully, someone at the Mint is getting a nice bonus for meeting circulation targets and the cosy to pay shipping is less than the savings that will occur to the government when fewer dollar bills are produced. Ideally, the Bureau of Engraving & Printing won't be angry if it eventually produces fewer paper dollars. Supposedly, paper dollars are used in counterfeiting $100 bills and maybe the "security" budget of that agency can be reduced.
Jul 7, 2009, 11:04 am
#2744
Join Date: Dec 2007
Posts: 187
If Chase, BofA and Citi all start complaining about the Mints direct ship program, you can bet it will be stopped.
Last edited by gleff; Jul 8, 2009 at 1:28 pm Reason: removed profanity written to avoid FT's filters
Jul 7, 2009, 11:09 am
#2745
Original Member
Join Date: May 1998
Posts: 1,139
Agree, but
Just my opinions.