WASHINGTON — The Federal Reserve Banks are accumulating a huge stockpile of Presidential $1 Coins because depository institutions (local banks) have been re-depositing the coins back into the Federal Reserve system, indicating consumers are not accepting wide-spread use, according to CoinNews.
Federal Reserve Banks have distributed more than 355 million Andrew Jackson, Martin Van Buren, William Henry Harrison, and John Tyler Presidential $1 Coins in the last accounting period, according to its annual report to Congress, but the Reserve has much more on hand.
“Current supplies represent enough $1 coins for the Reserve Banks to meet transactional demand for $1 coins for about 10 years,” the board of governors of the Federal Reserve System said in a statement.
This represents a more than 900% increase in supply over what the Reserve held when the Presidential $1 Coins were first introduced to the system. At the start of 2007, 67 million dollar coins were in inventory, but by the end of May 2009, 691 million coins were being held, according to Fed records.
The Federal Reserve’s report to Congress adds that industry officials indicated that the “Presidential $1 Coin Program has successfully met their needs, but that transactional demand for $1 coins has not increased since the start of the program.”
In the report, the board indicated that the current quantitative requirement in place for the Native American Dollar Coin should be addressed, because requiring that 20% of all dollar coins struck be Native American Dollars without a regard for demand isn’t conducive to an efficient system.