Laundromats – and the people who own and operate them – could potentially be affected by the recent position that the Federal Reserve has taken on the possibility of replacing the $1 bill with $1 coins.
Fed releases study on proposal
The central bank recently released a report that indicated its position on making such an exchange, asserting that it would not be a good idea. The document that was released by the Fed noted that several assessments have recently been conducted on the possibility of replacing the one dollar bill with a coin. The report that was provided by the financial institution asserted that Americans would be provided with a greater expense as a result of making this transition.
More specifically, the document estimated that another $6.9 billion in expenses would be generated over the course of 30 years, as a result of producing $1 coins instead of $1 bills, according to PlanetLaundry. However, the Fed has stated that this total expense would be reduced sharply due to the gap that exists between the cost of producing the new coins and their face value.
The financial institution has estimated that, as a result of this key factor, the cost of replacing the $1 bill with a $1 coin would fall to $1.2 billion over 30 years, the media outlet reported.
Opposition to Fed stance
There are certainly those who do not agree with the position that the Fed has taken on the possibility of exchanging the dollar bill for a dollar coin, and Shawn Smeallie, who heads up a trade organization, has asserted that harnessing paper money is rather costly, according to The Wall Street Journal.
"The Fed earns billions in profits each year from paper currency, only a portion of which they return to Treasury," Smeallie, executive director of the Dollar Coin Alliance, told the news source.
The organization commissioned a study, which found that over the course of 30 years, cost savings north of $13 billion would be generated as a result of making the switch.
"The $13 billion in estimated savings earned from the dollar coin would all go from the Mint to the taxpayer," Smeallie told the media outlet. "It’s no surprise the Fed is fighting currency modernization, when you understand their motives behind this report. The best interests of taxpayers, not the Fed, must come first."
People involved in owning and operating laundromats might benefit from staying up-to-date on the latest news that could affect their industry, such as the most recent developments on the proposal to replace $1 bill with a $1 coin.