FundamentalistTFTC NEWSDESK · FRI AUG 21 · 8:07 AM ET

13.78 CENTS TO MAKE A NICKEL — CONGRESS QUIETLY VOTES TO HOLLOW THE COIN, PENNY-1982 PLAYBOOK REPRISED

TFTC Newsdesk Aug 21 8:07 AM ET, and this is monetary history writing itself in real time. Congress passed two versions of the Common Cents Act this summer to reformulate the nickel. The math is what an operator needs: 13.78 cents to produce a 5-cent coin in FY2024, 13.31 cents in FY2025 — a cost-to-face-value ratio above 2.6x either year. Richmond Fed Dec 2025 Economic Brief pegs the seigniorage loss at $1.75 per dollar issued in nickels. The Mint lost $17.7 million producing 202 million nickels in FY2024, $92.6 million in FY2023. The fix reformulates the coin. The precedent bought 43 years last time.

The fix mirrors the 1982 penny playbook exactly. Swap the expensive metal for zinc. Cheapen the coin. Kick the can. The 1982 reformulation moved the penny from 95% copper to 97.5% zinc, thin copper plating on top — and it bought 43 years before the penny finally died on November 12, 2025 at the Philadelphia Mint. Two hundred thirty-two years of continuous production ended because production cost had reached 3.69 cents per one-cent coin. The nickel now runs the same math faster. If a zinc-core reformulation buys another 43 years, that is a 2069 problem. Fiat governments do not solve monetary-composition problems permanently. They defer them on the schedule the metallurgy permits.

The legislative timing tells the story. HR 3074, sponsored by Rep. Lisa McClain (R-MI) and Rep. Robert Garcia (D-CA), passed the House on July 14, 2026. S. 1525 passed the Senate on August 7, 2026. Two versions, both chambers, bipartisan. This is not a fringe monetary-reform bill. This is the machinery of federal debasement running on schedule. The reconciliation between the two versions has not yet happened; both chambers must agree before the president signs. Watch which version prevails — House version allows a fuller zinc substitution, Senate version leaves more nickel content. The Treasury Secretary’s discretion on the final mix (4-6 gram weight range, zinc inner layer, nickel outer shell) is the operator’s tell that the final formulation is a fiscal-optimization variable, not a monetary-integrity one.

First permanent peacetime nickel reformulation in 161 years. The five-cent piece has been 75% copper / 25% nickel since 1866. Wartime deviation (1942-1945 “wartime nickel” used 35% silver / 56% copper / 9% manganese due to WWII nickel demand) is the only prior composition change and it reverted when the war ended. The Common Cents Act would break that 161-year permanence. It is a small technical amendment that reads as a fiscal fix. It is a much larger monetary-history event that will be studied for what it signals about fiat-currency terminal composition dynamics. Every operator-class read of monetary history — Alden, Lepard, Gromen, Marty Bent’s Triffin essay we banner'd Thursday night — puts coinage debasement on the timeline of monetary-system unraveling. The Roman Empire debased the denarius by removing silver content over 250 years. The US is running the same play on the nickel over 161 years, potentially compressing to two composition changes inside a century.

Gresham’s Law runs in slow motion. The mechanism to watch: cheapened nickels hit circulation; existing 75/25 copper-nickel blanks disappear into jars, coin rolls, hobbyist collections, and cash-management stockpiles. Real metal gets stored. Debased tokens circulate. Bad money drives out good. Not because collectors are speculating, but because rational actors prefer to hold the coin whose intrinsic value exceeds its face value and spend the coin whose intrinsic value falls below. The pre-reformulation nickel stockpile becomes the new Gresham’s Law example alongside the pre-1965 silver quarter and half-dollar — those disappeared from circulation within months of the 1965 debasement. The zinc-core nickel will follow the same pattern. Watch the coin-collecting secondary market prices on 2020s-dated nickels over the next 24 months. Watch aggregators like Coinflation. Watch how quickly the pre-reformulation stockpile disappears from cash-register drawers.

The second-order effect the Richmond Fed already modeled. Killing the penny structurally increases nickel demand. Cash transactions round to the nearest 5 cents instead of 1 cent; every rounded transaction touches the nickel; nickel circulation velocity increases. The Richmond Fed brief models this explicitly: “the elimination of the penny is likely to increase demand for nickels.” Higher nickel demand at 13.78 cents per coin equals higher aggregate seigniorage loss. The Mint is running toward a bigger loss even before the reformulation compresses the per-coin loss. This is the fiat doom-loop in miniature — a fiscal fix that solves the visible problem while amplifying the underlying flow. Reformulate to reduce per-coin loss. Volume rises. Aggregate loss potentially still grows. Reformulate again in 20 or 30 years. Repeat until the coin itself is deprecated. The penny’s trajectory is the roadmap.

What the Fundamentalist tier holds against this. The operator-class read on hard money does not require a gold pitch to make the point. Something else in your pocket does not require reformulation every 40 years to remain economically producible. Something else in your pocket has a fixed terminal supply that no Treasury Secretary and no HR 3074 amendment can dilute at composition-metallurgy discretion. Something else in your pocket has been producing at a rate the protocol itself sets since 2009, and the block subsidy is scheduled to zero out on a calendar that no bipartisan bill can advance or delay. This piece does not need to name that asset. Every reader who has been in the operator class more than six months hears the implicit contrast at the third paragraph and does the arithmetic without prompting. The cap is still twenty-one million.

THE DEBASEMENT, DOCUMENTED 1) Source: TFTC Newsdesk, Aug 21 2026 8:07 AM ET. Primary references: Richmond Fed Dec 2025 Economic Brief; HR 3074; S. 1525; US Mint Annual Report FY2024, FY2025.
2) Nickel production cost: 13.78¢ per coin FY2024, 13.31¢ per coin FY2025 — cost-to-face ratio 2.6x+ either year.
3) Richmond Fed seigniorage loss estimate: $1.75 per $1 issued in nickels 2024.
4) Mint losses: $17.7M on 202M nickels FY2024; $92.6M FY2023.
5) HR 3074: passed House Jul 14 2026. Sponsors: Rep. Lisa McClain (R-MI), Rep. Robert Garcia (D-CA).
6) S. 1525: passed Senate Aug 7 2026. Two versions not yet reconciled.
7) Proposed composition: zinc inner layer + nickel outer shell; 4-6g weight range; final mix at Treasury Secretary discretion.
8) Current composition (since 1866): 75% copper / 25% nickel. First permanent peacetime reformulation in 161 years.
9) Wartime precedent (1942-1945): 35% silver / 56% copper / 9% manganese; reverted post-war.
10) Penny endgame: final penny struck Nov 12, 2025 at Philadelphia Mint after 232 years. Production cost had reached 3.69¢ per 1¢ coin. 1982 reformulation (95% copper → 97.5% zinc) bought 43 years.
11) Second-order effect: penny elimination structurally increases nickel demand per Richmond Fed model — amplifies aggregate loss even as per-coin loss compresses.
12) Gresham’s Law watch: pre-reformulation 75/25 blanks disappear into jars/collections/hoards; debased zinc-core circulates. Track secondary-market prices on 2020s-dated nickels via Coinflation and similar aggregators over 24 months.

Thirteen cents to make a nickel.
Congress votes to hollow the coin.
The 1982 playbook reprised, 43 years apart.
There is no bottom under a fiat system.
The cap is still twenty-one million.

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TFTC Newsdesk · Fri Aug 21 2026 · 8:07 AM ET · Primary sources: Richmond Fed Dec 2025 Economic Brief, HR 3074, S. 1525, US Mint Annual Report FY2024/FY2025