Waiting to Cash In

If you have some pre-1982 pennies, you are probably hanging on to them and waiting until the United States gets rid of the penny and they can be melted down for their copper.

To explain, we start with a lesson in metallurgy. Before 1982, the penny was made of copper. But that year, the cost of the copper required to create one penny rose above 1¢. So since 1982, the U.S. Mint coined pennies made primarily of zinc. That was cost-efficient until 2006 when the penny production cost rose to 1.23¢. In 2012, it costs 2.41¢ to make a penny.

Legislation is now considering eliminating Abe from our coinage altogether. Australia, New Zealand and Canada have eliminated their pennies already.

At the crossroads of metallurgy and political legislation, two cottage financial industries have subsequently emerged. The first was penny melting. Companies began collecting pre-1982 pennies and melting them to resell the copper. Copper prices kept rising and scads of pennies disappeared. Business was booming.

Copper melting proved so lucrative that illicit activities sprung up. Thieves began stripping copper wire from construction sites and utility connections. A...