Peter Schiff nickel argument suggests buying nickels over Treasury bonds. He says the metal value now outpaces the bond market.
The economist puts the melt value at 7.76 cents. That is about 55% above face value. Federal law bans melting the coins at all.
Why Peter Schiff nickel argument matters
Copper closed Tuesday at $6.69 a pound on COMEX. That is just below its August record. Nickel settled at $16,776 per tonne.
Each coin carries 3.75 grams of copper. It also has 1.25 grams of nickel. Those prices value the metal at 7.63 cents. This is roughly 53% above face value. Schiff’s number therefore lands close to the mark.
The metal also set a fresh record in London on Tuesday. Traders braced for US tariffs on refined copper. This drove prices higher.
His supply warning also holds weight. The Mint spent 13.31 cents to produce each nickel in fiscal 2025. Each coin therefore costs taxpayers more than double its face value. The Mint struck the final circulating penny last November.
Federal law blocks the melt trade
The pitch then hits a legal wall. Replies to his post flagged the problem. They are correct. Regulation 31 CFR Part 82 bars melting or exporting five-cent coins. Violators risk $10,000 fines and five years in prison.
Schiff waved the objection away. “You don’t have to melt them. They will hold their value.”
Nevertheless, that answer skips the logistics. Each nickel weighs five grams. A $10,000 stack therefore weighs a full metric ton. Scale it to $100,000, and the buyer stores 10 tons of change.
Meanwhile, the 10-year Treasury paid 4.77% on September 3. It needs no warehouse space.
The pitch fits Schiff’s long-running case against Bitcoin. It also targets paper claims. Record US debt and rising yields sharpen his argument.
The premium is real on paper. Nevertheless, it is locked inside metal nobody may legally melt. Whether the Mint retires the nickel next will decide if it ever pays.
