Euroflyer

"Sold Out" - What's up with that?!
The amounts people have been ordering, though, perhaps they really have exhausted the supply for now. Time for the next in the series to be minted. I'm sick of the corn planting scene on the back already.

In general, I've found that most places hate dealing with the coins. Sure, if you spend one or two people find them a novelty; whip out a box or two and people start giving you the frown, reasons why they don't want them, and the follow-up "Where did you get those from?".

Makes me miss those "credit card purchases of savings bonds" all the more!! Those were the days!!

icurhere2

I've never used a box for a purchase but make a point of using the coins at places that have the "minimum purchase requirement for the use of credit card" signs.

crabbing

for all the speculation about there being a "loophole" that we are somehow "exploiting" and that excessive deposits will "kill the deal," there is actually a lot of hard information that is being ignored here.

there is no "loophole"
the mint has made the decision that the value of (1) getting dollar coins into circulation and (2) the seigniorage it derives from selling coins compensates for paying credit card merchant fees and shipping. further, the goal of the program is to circulate dollar coins, which last longer and thus are more sound currency than dollar bills.

apart from the economics, the mint is acting pursuant to the $1 coin act, which obligates it to circulate these coins. one of the interesting aspects of the act is the obligation to circulate a certain percentage of n.a. coins, which are not as popular as the presidential coins. what apparently has happened is that the mint has run out of the current run of presidents, but is still sitting on a sizable number of n.a.'s - which could easily explain the recent lifting of the order limit on those coins.

huge deposits will not "kill the deal"
there is much speculation that some of the reported huge deposits, $5k or more, will result in the "loophole" being "discovered" and promptly closed. the main problem with this theory is that the people receiving the deposits have no direct connection to the people running the program. the mint ships the coins, which get deposited into banks, which keep a certain amount of coins on hand but send the excess to the federal reserve. coins are never returned to the mint, and the fed keeps coins in much the same way that it keeps other currency.

there are anecdotes posted here and elsewhere (e.g., fatwallet) that banks do not like huge coin deposits. their infrastructure is geared toward paper, not metal, currency, so there are physical limits on the amount of coins they can store. some have also claimed a burden in shipping coins to the fed beyond their normal costs (whether this is actually true, i do not know). so what these banks can do is change their written policies to limit the amount of coins a customer may deposit. banks are permitted to do so, even if it's legal currency (think paying bills in pennies), but the policy must be in writing.

one other issue that frequently pops up is money laundering. deposits of large numbers of rolled coins are, like deposits of large numbers of consecutive or stacked bills, are abnormal and naturally trigger laundering concerns. above a certain amount, the depositor is required to fill out a reporting form. banks also may restrict or preclude deposits above a certain amount (which may actually be the source of limits on large coin deposits in the first place).

there is no golden goose
FTers have become accustomed to mistake fares and secret exploits like the amex TC deal. these deals inevitably get shut down because the airline or amex discovers its mistake after a disproportionate number of people take the offer, or after internal accounting realizes the mistake. this reality convinces FTers that they must "fly below the radar" and devise ways of keeping their "golden goose" going without alerting the airline/whomever of their mistake.

that logic does not apply to the dollar coin direct ship program because there is no closed loop - the parties who suffer the most from the program, the banks, have no direct line of communication with the party implementing the program, the mint. and the mint is acting under federal law, making its policies even harder to change (even if those policies are not directly called for by those laws).

will this program last forever? of course not. eventually, the mint will conclude that sufficient coins are circulating that it does not need this program to encourage them. as stocks of paper $1 go down, the economy will get (or be forced to get) more accustomed to $1 coins, and banks will adjust their coin handling practices.

jlgrandam

Unless you work for the banks or the mint, your post appears to have just as many assumptions as the posts advocating for restraint. You also forgot about the "loophole" that we are getting a cash advance for no cash advance fee (at the moment). Banks aren't the only ones "suffering" as you put it, the credit card companies are as well. The merchant fees might cover the cost of the rewards points but I would guess they don't since CC's don't allow the purchase of other cash instruments to accrue rewards..

Furthermore, in your section entitled "huge deposits will not kill the deal" you concede that the banks could change their coin deposit policy in response to the exploitation of this deal. How then does your logic follow that the huge deposits will not kill the deal?

gejone

I think crabbing makes some very sound logical assumptions about the program. There is a federal law requiring the Mint to get the coins into circulation. They only have two methods to accomplish their mission: Sell the coins to the Fed or to individual customers. As crabbing pointed out the banks don't have the same demand for NA's as President's. I have also been told that on numerous occasions from the banks I use for my deposits. If the banks don't order the NA's, neither do the Feds and that doesn't help the Mint's mission. The Mint can point to the $1 Coin Direct Shipment program as a success as they are getting the coins into circulation. Once a coin leaves the Mint it is in "circulation", mission accomplished.

I don't agree with your statement that the credit card companies are suffering. The Mint is a producer of many products and sells those product to retail customers. Those products have been determined by the credit card companies to be retail sales not cash advances. The credit card company makes a profit from every one of our transactions. The Mint probably gets a favorable rate, as do many large merchants. Even if the credit card companies knew the details of our program, they probably wouldn't change it. Let's say the Mint pays 2% on every transaction and you pay your credit card bill every two weeks, that means they are making 48% on their money. How is that suffering? You may point out that a credit card bill is due once a month, but some of us pay every 7-8 days. If the credit card companies shut off the Mint, they would lose thousands, as all of their "collectible/proof coins" are still spendable coins. I have yet to hear of a FT'er not getting their points/miles on any credit card purchase from the Mint. Why does everyone want to 2nd quess the Mint's business practices and contracts with the credit card companies.

On your final post you said large deposits could kill the deal and cause the banks to change their rules. The recent comments on this thread indicate most people agree with that idea and are being reasonable in their deposits. If someone has worked out a process with the bank to take in $10K, great, but most people are seeing the logic in not burying a bank with large coin deposits. I don't agree that we are "exploiting" the deal, we are following the law and the Mint's policy. If you do a DBEQM MR, are you "exploiting" the airlines FF program. If a fare gets posted in error for a coast-coast fare of $1, it's happened, and you book the fare, are you "exploiting" the airline. The forum allows individuals to share information about getting miles however possible, we don't write the rules, we just use every one we can to achieve our goals.

jlgrandam

Guess we all have our opinions then! Best of luck to all and heres hoping the deal lasts another year!

gejone

This morning NA's became available and my order went through. It's not dead yet.

smcgrath12

Thanks, in for $5K. My order is showing "In stock and reserved", so I guess my order will get filled.

smcgrath12

I was discussing this with one of my co-worker. I was joking that I wish I could mint coins. He than told me about "Commissiory Coins".. Ever heard about them? From around 1870-1940, the coal mines, lumber yards, share croppers, etc. "paid" their employees in these company made coins, where you used these coins to buy stuff in the company stores. What a scam!! The compaines acted like US Mint, printed their own currency and had total control on currency inflation... I guess these coins are expensive collectible items right now...

al613

Now they have switch to miles What a scam!

smcgrath12

Out of order right now. Guess the FTers cleaned them out!!

aaron1262

that was so quick! good thing i put my order in this morning..hopefully it'll be the same quick turnaround time as all my order past month since im going on an extended vacation on saturday.

c_stanley

This is correct and doesn't seem like speculation. The mint is happy. Their entire goal is to get the coins out there into circulation. Sitting in a vault or a cash register -- who cares? They're out there. Sooner or later they have to end up somewhere, but one thing that can't happen is someone returning them to the mint. Doesn't work that way.

The CC companies are happy. Why wouldn't they be? You can buy all sorts of things that are worth $1000 by using a credit card at a merchant and spending $1000. Hell, at least the mint coins are clearly worth exactly $1000 -- say. What if you order a rare print off ebay worth $5000 and just pay $1000. What's the difference? The reason CC companies don't want free cash advances is because they want the merchant fees. If the mint pays that fee who cares what they sell? Another reason they're skeptical of cash advances like this is the problem of fraud, chargebacks, etc.

But remember it's the US mint we're dealing with. They have machines that MAKE MONEY all day. So if there's a problem with chargebacks, fraud, people complaining, they chargeback to the mint. Of every merchant account in the world the US mint's has to be the safest for a CC company to be able to successfully deal with chargebacks. To recap: THEY MAKE MONEY there from scratch. If there's a customer dispute they're good for it, they aren't going to clear out the merchant account and skip town leaving hundreds of thousands of dollars in chargebacks hanging out there.

So it's "free money" right? This seems impossible, hence the concern. But who loses? Well the mint, as they sell $1000 in cash for something like $985 less shipping costs. But they have MACHINES THAT MAKE MONEY all day, worth noting again, so despite how counterintuitive it seems they can sell money at a "loss" and still make money. They've decided it's worth it. In fact they likely are thrilled the demand for these coins is high, that's why they put them on sale like this.

There's no such thing as a free lunch. Unless you're the agency that decides what constitutes lunch, then takes nothing and makes lunches out of it. Then it makes sense.

Who else loses? Well the banks. They're the one odd man out here. They have to incur expense and hassle dealing with coins. But, then again, they are banks, that's what they do. You give them cold hard cash, they hand you back a slip of carbon paper. Despite the cost and hassle of dealing with coins it's just the same principle as dealing with paper cash. Just moreso. And though it seems odd to us, major bank branches actually do deal with large amounts of coins all the time. There are a ton of businesses that deal in coins, it's hardly unprecedented. Can you visualize the nightly deposits of ACME Vending Machine Corp? Hell, at least they probably cycle coins back into the machines. Let's visualize the cash handling division of a major city's parking meter operation. Meters don't give change, it's a one-way transaction. I'm guessing here but I have to assume they take in a LOT of coins, and they end up in a commercial bank too.

(ASIDE - I posted it earlier but if your bank has a commercial deposit window they're FAR more used to this. If you are allowed to use it you should. And PS, I do have a business account relationship with Citibank but nobody asks or cares, just fill out a slip and walk up to the business window with the coins well stacked to speed counting. You'll be fine.)

And being legal tender the banks can just send them to the Fed if nobody wants dollar coins, as pointed out above. If anyone loses at the end of the line it's the Fed, who face the reality of rooms filling with coins, yet no banks are ordering them. But I think they can handle it.

So the post above stands. There's no closed loop, nobody's really harmed. And the ones that are sort of harmed are under legal obligation to accept legal tender.

There's no reason to assume this will go away based on the uses described in this thread.

jlgrandam

Your posts demonstrates that you don't fully understand what is going on with this deal. For instance the Mint is making lots of money off this deal. Google "seignorage." Also there is no legal obligation for the bank to accept your coin deposit. People obviously rationalize things differently but I am speaking from experience of past 'deals' that were similar in nature to this one and all have been shut down. Take it for what it's worth and this deal was great while it lasted.

smcgrath12

Anybody use San Antonio downtown Frost bank? They are only frost bank that has a coin counting machine. The odd thing is, I deposited $2.5K, but the machine came out with $2498.50, which is $1.50 less. I asked the teller about it and she said that I must have some quarters in there. Hmm... I did not argue, I let the $1.50 go as "cost of doing business" as I did not want to piss off the teller and make her recount as I plan to go back there again and again.