It would actually do next to nothing if the entire supply were vanished right now. There’s about $300 billion in pennies in circulation. Around $850 per American, or roughly four days of average individual consumer spending.
The economy as a whole does on the order of 10s of trillions of dollars of activity a day.
Eliminating every penny would be less than a 1% reduction in liquidity, and even smaller in terms of actual use.
Oh, it’s definitely far bigger than GDP. Not all financial activity factors into GDP but it’s all part of the general movement of money that factors into inflation.
A lot of money is used for things that aren’t counted as “production”, like investments or used goods.
More than half of the worlds trade is conducted in dollars and there’s even larger flows of money involved in foreign exchange on a daily basis.
There’s just so much money churning around that reducing the supply by $300B isn’t a big dent, particularly when most of it’s already effectively out of circulation.
The ~$200 a day figure is right from bls and tracks consumer spending, notably including housing costs. https://www.bls.gov/cex/.
It’s about $100 a day if you remove housing and transportation. About $25 on food and $10 on “fun” a day, with $16 of that food being consumed groceries.
Now? They literally haven’t been Worth fishing out of the couch instead of just vacuuming up and toss the lot for years.
If someone throws out enough of them it should in theory help with inflation, but I doubt that many of them would ever be melted down or thrown away
It would actually do next to nothing if the entire supply were vanished right now. There’s about $300 billion in pennies in circulation. Around $850 per American, or roughly four days of average individual consumer spending.
The economy as a whole does on the order of 10s of trillions of dollars of activity a day.
Eliminating every penny would be less than a 1% reduction in liquidity, and even smaller in terms of actual use.
$850 a week sounds a little nuts to me, let alone 4 days, and not in consumer spending.
Our entire GDP isn’t $30T yet. I’m really questioning these numbers.
Oh, it’s definitely far bigger than GDP. Not all financial activity factors into GDP but it’s all part of the general movement of money that factors into inflation.
A lot of money is used for things that aren’t counted as “production”, like investments or used goods.
More than half of the worlds trade is conducted in dollars and there’s even larger flows of money involved in foreign exchange on a daily basis.
There’s just so much money churning around that reducing the supply by $300B isn’t a big dent, particularly when most of it’s already effectively out of circulation.
The ~$200 a day figure is right from bls and tracks consumer spending, notably including housing costs.
https://www.bls.gov/cex/.
It’s about $100 a day if you remove housing and transportation. About $25 on food and $10 on “fun” a day, with $16 of that food being consumed groceries.
$850 in 4 days is total yearly spending averaged daily, which only requires a household income of $80k/year.
$29T can be described as tens of trillions, that isn’t wrong at all?
GDP is yearly, not daily