Recently the daily paper published a letter from the director of the U.S. Mint defending the issuance of the so-called "Golden Dollars." He indicated that the Mint generated a profit of $800,000,000 (that's 800 million!!) due to the issuance of the G.D. My question is: How does the Mint make a "profit"? I have been unable to get an answer from the Mint; probably too busy minting other unnecessary pocket-ripping coins.
-- Les Land, San Diego
The Mint always makes a profit on its coins. It costs less than a penny to make a penny and only 12 cents to make the Sacajawea dollar. But the Mint just manufactures coins; the Federal Reserve is the bureaucracy that distributes them to banks. The Mint sells coins to the Fed at face value. That 88-cent profit on every buck is officially known as seniorage. So when the Mint struck a billion Sacajaweas, they were suddenly rolling in dough. At least that's the way they figure it.