Speaker 1: Welcome to brain Stuff production of iHeart Radio. Hey brain Stuff,
Speaker 1: Lauren Bogelbaum. Here. At grocery stores, convenience stores, and hardware
Speaker 1: stores across America, curious signs are popping up asking customers
Speaker 1: to pay with credit cards, debit cards, or exact change.
Speaker 1: Is it because cashiers don't want to handle physical dollars
Speaker 1: and cents that could be contaminated with the coronavirus? Nope,
Speaker 1: it's because the United States is currently experiencing a coin shortage.
Speaker 1: So where have they gone? America's pennies, nickels, dimes, and
Speaker 1: quarters haven't disappeared. The COVID nineteen pandemic has simply disrupted
Speaker 1: the normal cycle of coin circulation. According to the U. S. Treasury,
Speaker 1: there were forty seven point eight billion dollars worth of
Speaker 1: coins in circulation as of April, which was actually four
Speaker 1: hundred million dollars more than in April of nineteen. But
Speaker 1: those coins are not moving through the economy like they
Speaker 1: should be. The Federal Reserve gives several reasons as to
Speaker 1: why this is happening. Banks and businesses nationwide closed their
Speaker 1: doors during the lockdown phases of the pandemic, including cash
Speaker 1: and coin heavy sectors like convenience stores, public transit, and laundromats.
Speaker 1: The U S Mint also slowed its production of new
Speaker 1: coins during the early stages of the pandemic, as staff
Speaker 1: was reduced for safety reasons at the min's Philadelphia and
Speaker 1: Denver locations. Even as the economy reopens, consumers are opting
Speaker 1: for contactless payment and generally using less cash and coins,
Speaker 1: meaning more coins are sitting at home in mason jars,
Speaker 1: piggy banks, and under couch cushions. So what does this mean?
Speaker 1: Retail stores are feeling the pinch of the inconvenience and
Speaker 1: passing it along to their customers. The National Grocer's Association
Speaker 1: and several other retail industry trade groups sent a strongly
Speaker 1: worded letter to Federal Reserve Chair Jerome Powell and Treasury
Speaker 1: Secretary Steve Manustion in late June, saying that the federal
Speaker 1: rationing of coin shipments to banks quote threatens the functioning
Speaker 1: of our member businesses and, by extension, the needs of
Speaker 1: our customers. In their letter, the group's cited economic statistics
Speaker 1: showing that cash is still very much king in certain
Speaker 1: sectors and among certain consumer demographics. For example, between forty
Speaker 1: five to sixty percent of sales at grocery stores and
Speaker 1: convenience stores are cash payments. Nearly half of all transactions
Speaker 1: of ten dollars or less are paid in cash, and
Speaker 1: consumers with an annual household income of twenty five tho
Speaker 1: dollars or less paying cash for forty of their transactions.
Speaker 1: So what's the solution. The long term solution is to
Speaker 1: wait for the economy to return to normal, at which
Speaker 1: point coins will naturally flow back into circulation. But in
Speaker 1: the meantime, the Federal Reserve and the U s Mint
Speaker 1: are taking action. The Mint has ramped up coin production,
Speaker 1: outpacing its usual one billion coins a month, with one
Speaker 1: point two billion coins in June and one point three
Speaker 1: five billion a month for the rest of according to
Speaker 1: The New York Times. The Federal Reserve announced in June
Speaker 1: that it was rationing out its coin inventory by sending
Speaker 1: banks and credit unions smaller than normal coin shipments based
Speaker 1: on historical demand. The Fed also convened an emergency US
Speaker 1: Coin task Force, composed of government and industry leaders, including
Speaker 1: banks and armored car companies. The task force is expected
Speaker 1: to come up with a set of recommendations by the
Speaker 1: end of July. One of the task forces early accomplishments
Speaker 1: was to create the hashtag get coin moving, which banks
Speaker 1: and credit unions are plastering across Twitter to encourage people
Speaker 1: to cash in their piggy banks to get more coins
Speaker 1: back in circulation. Today's episode was written by Dave Ruse
Speaker 1: and produced by Tyler Klang. For more on this and
Speaker 1: lots of other totally money topics, visit how stuff works
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