It Costs More to Make More

How much does it cost to make a penny or nickle?That penny in your pocket may not be worth much, but its cheapness did not carry through to the manufacturing process.

Due to rising costs of metal, as of 2016 the US Mint spend about 1.7¢ to make each penny, and about 8¢ for every nickle.

Banking on a Good Investment Return

First Social Security benefits Ida May Fuller
Ida May Fuller holds the first Social Security benefits check.

Ida May Fuller (1874-1975) was the first recipient of United States Social Security benefits. Her first check arrived on January 31, 1940 and totaled $22.54. That was a pretty good deal for her, considering that she retired after having paid in only three years of payroll taxes, totaling $24.75. Mrs. Fuller lived for another 35 years. By the time of her death, at age 100, she received a total of $20,944.42 from Social Security — a return of 84,624%

Compare this to the benefits one might expect to receive today. According to a study by the Urban Institute, a single female earning an average wage who turned 65 in 2010 would have paid in a total of $361,000 in lifetime Social Security and Medicare taxes. In exchange, she would be expected to receive $302,000 from Social Security and $207,000 from Medicare — a return of 141%.

That’s still better than a single male who turned 65 that same year. His payroll taxes in the same amount as his female counterpart would be the same, but he could expect to receive only $457,000 in total benefits — a return of only 126.6%.

Walmart: The Savings Place and Earnings Place

Walmart sales per second profits per second

Walmart generates sales of $36,750,000 every hour. To put that in perspective, if it took you five seconds to read that last sentence, $51,041.67 entered Walmart’s cash registers during that time.

From those sales in their 11,620 stores around the world, Walmart earns a profit of $2,099,100 each hour. That comes out to $583.83 for every second of every day.

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A Diamond of a Discovery

 diamond planet  55 canceri e 

The planet 55 Cancri e is essentially  a diamond — and a very big one at that. At twice the size of earth, it is estimated to be worth $26.9 nonillion (269, followed by 29 zeros). 

Strangely reminiscent of the Planet Midnight in the BBC television program Doctor Who, this real life diamond planet orbits a star in the constellation Cancer. Composed largely of carbon, the surface temperature of 1,700 Celsius (3,100 Fahrenheit) and its large mass is ideal conditions for creating diamonds.  

Doctor Who Diamond Planet Midnight
Planet Midnight from Doctor Who
 With Earth’s total gross domestic product estimated at $70 trillion in 2011, the value of 55 Canceri e is 384 quadrillion times more than our planet’s annual GDP.

Thanks to HUMERME.com for the inspiration for this post. 

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When Quintillionaires Are Paupers

1946 Hungarian Milliard Bilpengő
1946 Hungarian Milliard Bilpengő

Who hasn’t heard an older person complain that a dollar just doesn’t buy what it used to? Imagine what it was like in Hungary in the immediate aftermath of World War II, when the nation encountered the worst case of hyperinflation in history.

Because of the instability of the national economy, something that cost 379 Pengö in September 1945, cost 72,330 Pengö by January 1945, 453,886 Pengö by February, 1,872,910 by March, 35,790,276 Pengö by April, 11.267 billion Pengö by May 31, 862 billion Pengö by June 15, 954 trillion Pengö by June 30, 3 billion billion Pengö by July 7, 11 trillion billion Pengö by July 15 and 1 trillion trillion Pengö by July 22, 1946.

At its peak, prices were rising at the rate of 150,000% every day. To put that into context, if that had happened today in the United States, a piece of candy that cost 25 cents this morning would cost $37,500 by the end of the day, and by the end of the day tomorrow would cost $5,625,000,000.

Prior to the start of World War II, the exchange rate was 5 Pengö to one US Dollar. By June 1944 the rate was 33 Pengö to the Dollar. At the beginning of August 1945 one Dollar could get you 1,320 Pengö. Three months later, one Dollar was worth 100,000 Pengö. Four months after that, in March 1946, the same Dollar exchanged for 1.75 million Pengö. One month later, it was 59 billion Pengö. The next month it was 42 quadrillion Pengö. By July it was 460 trillion trillion Pengö, and by then, what’s the point?

To address the out-of-control price increases, the government issued currency with increasingly-larger face value,  culminating with the Milliard Bilpengö (pictured above), worth 1,000,000,000,000,000,000,000 Pengö. It is the highest denomination banknote ever printed. It was worth about 12 cents in US currency.

A Hungarian worker sweeps the streets, littered with with worthless money.
A Hungarian worker sweeps the streets, littered with with worthless money.

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Better Buy a Bigger Wallet

An example of Yapese currency
An example of Yapese currency
If you are traveling to the island of Yap in the Federated States of Micronesia, you might consider using a credit card, rather than having to convert your cash into local currency.

The legal tender currency is called Rai, and it consists of doughnut-shaped stones, ranging from 3.5 cm (1.4 in) to 4 meters (12 feet) in diameter. The largest coins require twenty grown men to carry them.

While the US dollar is now the generally-accepted currency, the Rai continue to be honored as legal tender, although their primary purpose tends to be for traditional or ceremonial transactions.

In 1929 the inventory of official Rai amounted to 13,821 stones on the island. About half of these remain. Their value is determined by their size, and they can be converted into foreign currency through the Bank of Hawaii. A 2.5 cm (1 in) Rai is worth $72 US, and a 25 cm (10 in) Rai would fetch about $6,000 US.

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