Fat piggy banks indicate economic upturn

How much loose change do you have at home? The number of quarters, dimes, nickels and even pennies that people keep in their coin jars and piggy banks is an indicator of the health of the U.S. economy. More change saved means times are better.

During the recession, a lot of people emptied their change jars and put those coins back into circulation -- requiring the U.S. Mint to produce far fewer new ones. Increased demand for those circulating coins in 2011 means people have gone back to saving, NPR reported.

"People went into their piggy banks and their coin jars and spent those coins," Richard Peterson, deputy director of the U.S. Mint, told NPR's Planet Money. "Those coins flowed back into the banks and then ultimately back to Federal Reserve. The Federal Reserve vaults started filling up and they turned off the spigot of new coin production from the United States Mint."

The economic crisis hit the Mint hardest in federal fiscal year 2009, when a "massive flow-back of coins from circulation" led the Federal Reserve banks to order only 5.2 billion new coins, according to the Mint's annual report (.pdf file). That number represented the lowest level since the 1960s.

Though FY 2011's 7.4 billion new circulating coins falls far short of the Mint's peak shipments of more than 27 billion coins in FY 2000 -- spurred by concerns over Year 2000 and the popularity of the 50 State Quarters Program -- it represents an increase of 37%, NPR reported.

Economic instability was good for the Mint

Increased production of pocket change may signify better economic health, but Americans were still nervous last year. Demand for precious metal bullion spiked as people sought the relatively stable investments of silver and gold, NPR said. The Mint sold a record 45.2 million ounces of bullion assets in FY 2011. Post continues below.

Not as shiny was the fact that creating nickels and pennies actually cost more than twice what the coins are worth. "The FY 2011 year-end cost of a penny was $0.0241. Likewise, the year-end cost of the nickel was $0.1118 per coin," the report said.

Also bad news for the Mint was the White House's recent announcement ending the $1 presidential coin program, as we reported recently. The program, which required that the Mint make dollar coins honoring all dead U.S. presidents, wasn't popular with Americans. By the way, each coin cost only 18 cents to produce.

Have you experienced a lighter piggy bank over the past couple of years -- and is it getting fuller now?

More on MSN Money:

• Is it time to get rid of the penny?
• Gold slides on firm dollar
• Why $1 coins haven't caught on
• US Mint pulls gold collector coins
• Feds go after wacky 'Liberty Dollars'
• Today's best savings rates