The Great Gold Price Mystery!

Coin-Changing Cash Machines Take the High Street by Storm - Sunday Mirror

According to the Sunday Mirror Article:

Coin-changing cash machines take the high street by storm
Hard-up families are raiding piggybanks and searching for coins down sofas as they struggle to make ends meet.
Up to £1MILLION a day in loose change is being changed at self-service coin machines in supermarkets.
Coinstar, the US firm behind the ­network, charge 8.9p for every £1 of coins they change.
Yet business is booming with 1,700 machines across the ­country – double the number of eight years ago. And they are handling 200,000 transactions a week with the average customer bringing in £28 worth of small change mostly in 1p and 2p coins.
“The reason people use the ­machine is to make the family budget go further,” said Nick ­Harris, of Coinstar. “In these cash-strapped times every penny counts. We are processing 40,000 tonnes of loose change each year. which is a staggering amount.”
Coinstar says high street banks are often reluctant to accept loose coins unless they are sorted and bagged.
Customers using the Coinstar machines pour unsorted coins into a funnel to be counted. They are then give a voucher showing the value, which can be ­exchanged for cash at the checkout or used to pay shopping bills.
The biggest single UK ­transaction so far was one for £5,677 in Sydenham, South London, which would have taken around four hours to process.
The Royal Mint estimates £400million worth of loose coins is lying around in people’s homes – around 13 billion of the 22 billion coins in circulation.

Difference of Opinion
We invited a few members of staff to comment on the news article with a view to creating a critical web page about it. We were surprised that is drew quite a range of responses from our staff. Our main thought was wondering how paying 8.9% commission to count and change coins helps hard up families. Our answer is that it does not. It simply gives the poor and the stupid another way to get even poorer still. We are surprised to see presumably responsible journalists parroting Coinstar's propaganda without thought. A responsible newspaper with any social conscience ought to be asking the same question as us, and accusing Coinstar and supermarkets of ripping people off.
The discussions helped to frame a few other questions about the original article, under the following headings:
A few key words come into my mind:

• Numeracy?
  If poor families really are using these machines, is it because they cannot count, and they are simply so badly educated that they are innumerate; or perhaps have such a low IQ that they are unable to learn how to count, or how to look after their meagre wealth.

• Education How bad are our educational standards if people find it so difficult to count coins, that they pay 8.9% commission instead?
  Also, how about parents getting together with their children of almost any age, and sorting and counting the coins with them. This would help to teach their children simple but extremely valuable numeracy skills. It would also help to instill in their children the value of money, and how to manage it carefully.

• Poverty
  If poor people use these machines, and encouraged to do so by thoughtless newspaper articles, then they are damning themselves to be locked into eternal poverty, probably linked to poor education, laziness, or stupidity.

• Stupidity
  We could understand a small number of wealthy people using these machines because of their convenience, but for anybody with excess wealth must be stupid to use them.

• Exploitation
  Coinstar's press releases, supermarkets complicity and soft, uncritical media comment, all conspire to exploit the poorest, stupidest, and most vulnerable people in our society.

• Fakes?
  We wonder how good the machines are at detecting counterfeit coins. The most commonly forged coins in the UK today are pound coins, where fakes are estimated to constitute around 2% to 3% of the total.

• Charity
  If somebody with surplus wealth or shortage of time, wanted to get rid of spare change, they could always drop them into a charity shop and offer them 5% to change them, or better still, make a donation.

• Warren Buffett
  We wonder what Warren Buffet's attitude would be. We would be astounded if he thought using the machines was a good idea, but not surprised to hear him investing in the companies behind them.

• Self Service Tills
  One of our staff came up with the very good point that number of supermarkets have self service tills which incorporate coin hoppers. With these, you simply pour your coins in, and use them to pay for your shopping. No commission, no rip-off!

Our Thoughts (This was a quick ideas list for our first draft)
Coin-changing cash machines take the high street by storm
Hard-up families are raiding piggybanks and searching for coins down sofas as they struggle to make ends meet.
Up to £1MILLION a day in loose change is being changed at self-service coin machines in supermarkets.
Coinstar, the US firm behind the ­network, charge 8.9p for every £1 of coins they change.
Yet business is booming with 1,700 machines across the ­country – double the number of eight years ago. And they are handling 200,000 transactions a week with the average customer bringing in £28 worth of small change mostly in 1p and 2p coins.

• How much is the average user paying in charges?
  £2.49 base on £28 average count.

• How long would it take to count them by hand? (£29 worth we mean, not 40,000 tonnes).
  

• Why not spend them at shops?
  If an individual has less than a few pounds worth, why not simply take them out in a bag, and spend them during the day.

• How much was that in charges?
  £505.25! This really must have been one individual with more money than sense. Perhaps a professional footballer cashing in all the coins that rival fans had thrown at him? Possibly a modern beggar worried about overloading his Ferrari.

• Who keeps the 8.9%? Is it the shops, Coinstar, shared?
  

A Modern Morality Story
From being a simple page about coin changing machines, we think we revealed a modern morality tale. Do too many people have too much money? More money than sense? Perhaps we needed a recession to wake people up, and shake them out of self-satisfied apathy and sloth. Perhaps it will take an even harder recession to really educate people to be more careful with the money and resources they already have, and make some effort to conserve them, rather than give them away to the nearest big business.

Numismatic Connection
We only noticed the news story because it came through on a Google news alert for coins. We have made no mention of any numismatic connection, partly because most of our decimal small change is rather boring. There have been few design changes, and no rare dates. Before decimalisation things were different. Now if the Royal Mint issued a low value coin such as a twopence, in themed series, like the Olympic fifty pences, or US state quarters, there might be companies out there who would pay you to change your small denominations up for you.