Gresham’s Law states that whenever government overvalues one form of money and undervalues another, the undervalued money will leave the country or disappear into “hoarding,” while the overvalued money will flood into circulation. Hence the saying, “Bad money drives out the good.”
In the early 1960s U.S coins were made with real silver money but with price of silver rising the U.S. stopped minting coins with silver. It is hard to find any silver coins now unless you collect them. The fact is that these coins, because of their silver content, are now more worth than their face amount.
Instead of the US firming up the USD by buying and holding amounts of silver in the central banks, they decided to debase the currency. Silver coins still hold exceptional value. The old dime contains over $1.40 worth of silver at today’s silver price. The old quarter is worth nearly $3.60. A 50-cent piece contained about $8 of silver. And a good old silver dollar is now worth more than 16 times its face value. And these are just the silver values of the coins. The coins themselves might be worth far more, depending on condition and rarity. (source http://www.whiskeyandgunpowder.com/)
Don’t be surprised if the nickel and the penny disappear soon enough as they know cost more to produce than what their face states. In the old times, unethical traders would clip some of the silver content from the coins and then re-melt them. This was seen as an egregious offense, but today the government does it daily without a whimper from the masses.
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