Decline in coin demand during the Great Depression

RWB

We’ve all seen statements about how a decline in public demand for coins during the Great Depression caused the Mint Bureau to reduce production. To me, this has been a logical statement without much backing. But now, here’s some of the evidence to support that idea.

Silver and minor coins shipped from the mints

FY 1930 - $9,839,230
FY 1931 - $1,417,000

That’s a decrease of 85% in only one year.
In 1931 the mints shipped only $55,000 in quarters and $90,000 in dimes to the entire nation!

[NARA-Cp RG 56 entry191, box 032]

COALPORTER

Werent there some years they made zero silver coins? (I'm too lazy to get out the Red Book)

RWB

Prior years were greater than $9 million.

roadrunner

On the flip side though, once inflationary forces were unleased by FDR in the summer of 1933, coin production soared from 1934 on.

roadrunner

RWB

Weeeell...somewhat.

It seems that production was increased in 1934 to contribute to the impression of strong economic improvement, and to force silver into circulation. This is also what was behind the 1934-35 Peace dollars. The original plan was for a new design, but there wasn't time.

EagleEye

Inflation during the 1930's actually declined. Yes, Roosevelt took us off the gold standard and reset the official value of gold, but it wasn't until WWII that inflation took off (for a good reason, since we're remembering our servicemen this weekend)

Coin demand is related to what is needed in commerce. During the depression, new coins were not needed since older coins were coming out of hiding and there was less velocity of coins in commerce.

ProofArtworkonCircs

<<In 1931 the mints shipped only $55,000 in quarters >>

Well that is $55,000 or 220,000 quarters MORE than they made that year.

CaptHenway

<< <i><<In 1931 the mints shipped only $55,000 in quarters >>

Well that is $55,000 or 220,000 quarters MORE than they made that year. >>



He was quoting fiscal year figures.

AnkurJ

I beleive that is why the San Francisco mint coins were made very little numbers, and that is what makes them valueable today.

The 1931s Lincoln Cent was one of the first coins I purchased.

Justacommeman

<< <i>Inflation during the 1930's actually declined. Yes, Roosevelt took us off the gold standard and reset the official value of gold, but it wasn't until WWII that inflation took off (for a good reason, since we're remembering our servicemen this weekend) >>



The early thirties saw "negative inflation" rates. As RR pointed in 1934 the system received a jolt and inflation went "positive". MJ

EagleEye

rooksmith

The decline in coin demand was definitely do to a drop in overall retail activity during the depression. Of course the 1930's there were no credit cards, also the dollar was worth about 10 times more than its current value. Today, theres actually less real need for coins, since so many more transactions are done by plastic.

Oddly enough in the current "great recession" they are making more $1 coins than smaller denominations.

golfer72

"Werent there some years they made zero silver coins? (I'm too lazy to get out the Red Book)" No quarters were minted in 1930 and no halves in 31 and 32. No dimes in 32 and 33.

giorgio11

<< <i>"Werent there some years they made zero silver coins? (I'm too lazy to get out the Red Book)" No quarters were minted in 1930 and no halves in 31 and 32. No dimes in 32 and 33. >>



Actually, between Philly and SF nearly 7.2 million Standing Liberty quarters were made in 1930. You are correct about the others, and the Lincoln cent mintages went way down in 1932 and 33, as well--right at 40 million cents in both years combined, compared to 246.5 million cents in 1930 and 1931.

ProofArtworkonCircs

<<"Werent there some years they made zero silver coins? (I'm too lazy to get out the Red Book)" No quarters were minted in 1930 and no halves in 31 and 32. No dimes in 32 and 33.>>

It was no quarters in 1931 and 1933 and also no halves in 1930.

Justacommeman

Historical annualized inflation rate using CPI 1930-1945. MJ

1930 -2.3%
1931 -9.0%
1932 -9.9%
1933 -5.1%
1934 +3.1%
1935 +2.2%
1936 +1.5%
1937 +3.6 %
1938 -2.1%
1939 -1.4%
1940 +0.7%
1941 +5.0%
1942 +10.9%
1943 +6.1%
1944 +1.7%
1945 +2.3%
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