Joliet Jake
Full Member
I had been wondering about the flow of half dollars, so I called the Chicago Federal Reserve bank, and an armored car company, and the following is what I was told.
Of course all the half dollars, like other US coin, originally came from the US Mint, but Half Dollars are a special case, as the US Mint does not press any new halves for circulation, just for collectors willing to pay 1.5x face for a couple rolls or 1000 coin bags. The Federal Reserve Bank keeps it's coin at the many "designated depositories for the Federal Reserve Bank". That is Fed speak for armored car companies. Pretty much ALL armored car companies are a "designated depository for the Federal Reserve Bank", as this is a big part of their income. The armored car companies may have physical inventory, but the Fed has all the control. That is why your bank will tell you they "order their coin from the Fed". They really do. Then the Federal Reserve Bank authorises one of the "designated depositories for the Federal Reserve Bank" to release coin to the bank that ordered it.
So far, the ordering and shipping and rolling of the coin has been done at taxpayer expense. Now the armored car company loads up the truck with boxes of coin, bags of banded currency, and whatever else your bank has ordered and delivers it, and at the same time picks up bags of coin from your banks counting machine and bags of currency to be processed by the company, and checks, etc. to take to the fed for processing. The bank pays a monthly or a per visit fee (or both) to the armored car company. They do not pay a per box or "re-rolling" fees. Those fees are made up by each bank that charges them, like overdraft fees and ATM fees. Heck, some banks charge extra to talk to a teller instead of using the ATM.
So what I infer from this is that the armored car companies have a finite amount of half dollars (clad that no one wants) that they recirculate with whatever gets turned in to the banks they service. I suppose some banks have some old stock in the vault, and perhaps there are some old bags sitting at some armored car companies, but in high traffic areas with lots of people CRHing, all the silver must come from deposits at banks that get past the tellers. Because the Fed "Controls" the coin and currency, the armored car companies are not supposed to cherry pick, (thats why they seal the coin bags at the banks), but perhaps some do. The one I talked to said they don't look at what they are rolling up.
The coinstar companies of the world also throw a bit of a curve into the mix, since they are certainly searching the coin they get for silver, or rejecting it at the machine. I have to wonder what happens when they turn in their inventory of clad half dollars, and who they dump it to.
Of course all the half dollars, like other US coin, originally came from the US Mint, but Half Dollars are a special case, as the US Mint does not press any new halves for circulation, just for collectors willing to pay 1.5x face for a couple rolls or 1000 coin bags. The Federal Reserve Bank keeps it's coin at the many "designated depositories for the Federal Reserve Bank". That is Fed speak for armored car companies. Pretty much ALL armored car companies are a "designated depository for the Federal Reserve Bank", as this is a big part of their income. The armored car companies may have physical inventory, but the Fed has all the control. That is why your bank will tell you they "order their coin from the Fed". They really do. Then the Federal Reserve Bank authorises one of the "designated depositories for the Federal Reserve Bank" to release coin to the bank that ordered it.
So far, the ordering and shipping and rolling of the coin has been done at taxpayer expense. Now the armored car company loads up the truck with boxes of coin, bags of banded currency, and whatever else your bank has ordered and delivers it, and at the same time picks up bags of coin from your banks counting machine and bags of currency to be processed by the company, and checks, etc. to take to the fed for processing. The bank pays a monthly or a per visit fee (or both) to the armored car company. They do not pay a per box or "re-rolling" fees. Those fees are made up by each bank that charges them, like overdraft fees and ATM fees. Heck, some banks charge extra to talk to a teller instead of using the ATM.
So what I infer from this is that the armored car companies have a finite amount of half dollars (clad that no one wants) that they recirculate with whatever gets turned in to the banks they service. I suppose some banks have some old stock in the vault, and perhaps there are some old bags sitting at some armored car companies, but in high traffic areas with lots of people CRHing, all the silver must come from deposits at banks that get past the tellers. Because the Fed "Controls" the coin and currency, the armored car companies are not supposed to cherry pick, (thats why they seal the coin bags at the banks), but perhaps some do. The one I talked to said they don't look at what they are rolling up.
The coinstar companies of the world also throw a bit of a curve into the mix, since they are certainly searching the coin they get for silver, or rejecting it at the machine. I have to wonder what happens when they turn in their inventory of clad half dollars, and who they dump it to.
Amazon Forum Fav 👍
Upvote
0
