i guess you could put little bumps on the bills but i'd think the cost of changing vending machine bill acceptors would be huge...though they changed them all for the recent bill updates

changing the size of the bills would definitely require huge vending machine costs, not to mention the trays in cash registers!

thats what I thought !!!

http://www.npr.org/templates/story/stor ... =104063298

Why We Spend Coins Faster Than Bills
by Chana Joffe-Walt

As the recession deepened, Rick Alfaro of Sacramento noticed that more people were using coins in his office vending machine — and clogging it up.

Alfaro's theory was that people were feeling pinched and that using coins, as opposed to dollar bills, made them feel they were spending less. He asked the worker who stocks the machine, and the answer came back that he was right. People are "kind of scrimping a little bit and digging in their car" for loose change, Alfaro says.

For Alfaro it was just a hunch, but it turns out that economists have researched the phenomenon, which they call the Denomination Effect. Priya Raghubir and Joydeep Srivastava did a series of experiments in the U.S. and China that showed people were much more willing to spend the same sum of money if they had smaller denominations instead of one large bill.

"We've done some studies with four quarters and a dollar, and we found that people were much less likely to spend the $1 note that they were given than the four quarters they were given," Raghubir says.

Another experiment involved Raghubir standing outside a gas station in Omaha. She would have people fill in a survey about gas usage and then thanked them with either a $5 bill, five $1 bills or five $1 coins. People went into the store, and when they came out Raghubir asked them for their receipts. The ones with coins spent the most, people with dollar bills a little less. And people with one $5 bill kept that one in their pockets.

Raghubir wanted to see whether that effect was particular to American culture, so they ran the experiment overseas. Given a week's salary in different denominations, housewives in China behaved the same way.

If we want to get consumers going again, Raghubir says, we should hand out lots of change.

"If I were President Obama, the very first thing I'd recommend is increase the circulation of $1 coins and consider introducing $2 coins," she says.

Likewise, she says the IRS should stop sending tax rebates as lump sums. "You could send us travelers checks," Raghubir advises. "Send it in twenties, the way we get cash."

The research seems clear, and in some ways intuitive. She opens her paper with a Mexican proverb that advises taking care of small, loose bills, since large bills take care of themselves.

Very tricky. An easy way for the Mint to not need to be used like this is to just discontinue the damn $1 bill.

http://blogs.forbes.com/johngiuffo/2011 ... -u-s-mint/

Fly For Free Thanks To The U.S. Mint
Jul. 13 2011 - 12:50 pm

For some people, racking up frequent flier miles can border on obsession. Supermarket purchases, restaurant meals, clothing, entertainment – if it can go on the frequent flier card, it does. But racking up thousands of frequent flier miles for free? That’s a trick that all but the truly dedicated can only dream about.

But it’s possible, and best of all, it’s legal.

Not exactly ethical, but it’s not a crime – at least not yet. The trick (it feels more like a scam) is to use a government program meant for promoting the circulation of dollar coins for everyday use. And it’s not new: travel hackers have been doing it for years, and it’s only recently that the federal government has caught on and done something about it.

It goes something like this: The U.S. Mint, through a 2005 act of Congress, is required to place $1 billion worth of the golden presidential and Sacagewea dollars into circulation in an effort to stimulate general use. The only problem is, the coins haven’t really caught on with the general public. But there is one group of people that have enthusiastically embraced their use: travel hackers, so called because they aggressively look for loopholes in promotional programs and for tips on travel websites for ways in which to make the best use of their travel dollars. Much of this “hacking” involves taking advantage of frequent flier programs in unique and innovative ways.

The dollar coin trick involves purchasing large amounts of coins with a frequent flier card, waiting for the Mint to ship the coins (free shipping!), and then taking the coins to the bank, where they are deposited and the money is used to pay the credit card charges. No money is lost, the frequent flier miles rack up, and travelers can use them for upgrades or completely free flights whenever they want. According to NPR’s Planet Money, which broadcast a story about the scheme on Wednesday morning, the Mint caught on when some customers started buying hundreds of thousands of dollars worth of free coins, so it has since limited purchases to $1,000 every ten days. But 3,000 free frequent fliers miles per month still isn’t a bad deal. NPR quotes Mint spokesman Tom Jurkowsky about the ways in which the Mint has tried to curb the practice: “Do we feel a little bit violated? Yes, and that’s why we aggressively sought measures to eliminate what we called an abuse.”

One site, TravelHacking.org, promotes these methods as a way to gain money through membership through its website, but it’s not really necessary to pay any money at all to learn some of the best ways to travel hack – in fact, many of these methods are enthusiastically promoted on various travel sites. Popular travel website Gadling wrote about the tactic in April, discussing the trick’s growing popularity, how it resembles a cash advance, and how the IRS doesn’t consider it a cash advance for tax purposes. For many with the financial flexibility to have $3,000 a month in circulation, it seems like too good an opportunity to pass up. As stated above, it’s not a new phenomenon: The Wall Street Journal wrote about the coin trick in 2009, which ultimately may have played a role in the Mint’s crackdown.

Contrary to some reports, the practice hasn’t ended since the Mint enacted the new rules; it’s only slowed down. You can find the web page for the Mint’s coin program here.

And until frequent flier miles card issuers catch on and do something about the practice, it seems likely to attract the sort of customers who are looking at the fine print of their rewards programs for any and all ways in which to maximize their mileage.

Considering the ways in which the airlines have pushed customer service to the brink in their attempts to maximize profits, it seems only fair – even if it does feel a little bit like a scam.

Would making a large "purchase" like that and then immediately paying it off be beneficial to one's credit score?

Not sure it will have much effect. They tend to just look at your available credit vs amount outstanding.

But doesn't simply using and paying off a credit card help your credit? My question was would this be counted any less because you're buying money?

No, the type of purchase on a credit card is not looked at when determining credit score. Just secured vs. unsecured debt.

the addition of a penny to the monetary base adds more than 1.23 to the money supply.

this doesn't justify the penny, but we're not losing money on it either