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Old 04 January 2013, 04:58 PM
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Default Can We Avert the Coming Debt Ceiling Crisis with a Magic Coin?

Because of the deal made on New Year's Day that averted the immediate impact of the so-called fiscal cliff, America will face a sequel to the debt ceiling hostage crisis that led to the super committee and the sequester and the fiscal cliff and the fiscal cliff solution and the sequel to the debt ceiling hostage crisis that led to the super committee and the sequester and the fiscal cliff and the fiscal cliff solution, et cetera, ad infinitum. The best of all possible fiscal cliff deals would have included a guaranteed de-weaponization of the debt ceiling. Since the fiscal cliff deal did not include any such de-weaponization, America's credit and the global economy are still very much jeopardized by the dangerous lunatics who have threatened another round of hostage-taking.

What can be done about it? Well, what about a magic trillion-dollar coin, wrought from platinum? Would that help?

http://www.capitalnewyork.com/articl...ion-dollar-coi
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Old 04 January 2013, 09:52 PM
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If they want an exotic metal coin, why not plutonium? Not a bad idea for a coin that isn't supposed to circulate.
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Old 04 January 2013, 09:55 PM
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Good luck getting change from a vending machine for that.
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Old 04 January 2013, 10:14 PM
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Rachael Maddow covered this on her show a month ago. From what I remember, the exact wording of the law in question required a platinum coin.
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Old 05 January 2013, 06:20 AM
Sjö Sjö is offline
 
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Isn't that essentially the same as printing more bills to pay government debt? And wouldn't that have the same effect on inflation?
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  #6  
Old 05 January 2013, 04:13 PM
Singing in the Drizzle Singing in the Drizzle is offline
 
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Platinum is at about $50 per gram. To make it worth $1 trillion it would require about 20,000 metric tons of platinum per coin.

Not something the average person will be able to steal.
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  #7  
Old 05 January 2013, 04:39 PM
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I want one for my coin collection. Of course, my wife is still harping at me to move the Yap coin out of the living room.
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Old 05 January 2013, 05:37 PM
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Quote:
Originally Posted by Sjö View Post
Isn't that essentially the same as printing more bills to pay government debt? And wouldn't that have the same effect on inflation?
No because you wouldnt be spending the entire trillion. The government would only spend as much as it wished so the effects on inflation would hopefully be fairly small, and some slight increase in inflation shouldbe beneficial.
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  #9  
Old 05 January 2013, 09:29 PM
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E. Q. Taft E. Q. Taft is offline
 
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Quote:
Originally Posted by Singing in the Drizzle View Post
Platinum is at about $50 per gram. To make it worth $1 trillion it would require about 20,000 metric tons of platinum per coin.

Not something the average person will be able to steal.
The law apparently says that the face value of the coin doesn't have to bear any relation to the value of the metal. So they could make one out of a couple of ounces and just stamp "one trillion dollars" on it, and that's it's legal value.

The whole thing appeals to my sense of the absurd -- it's an idea I can remember thinking up when I was a kid ("If the government owes a trillion dollars, can't they just print up a trillion dollar bill and be even?") which even then I suspected had something seriously wrong with it. At the same time, so little money is 'real' these days -- even cash only has value because we agree it does (and the same is really true of precious metals and gems -- beyond the industrial value, which can be significant) and the great majority of 'money' in the economy is nothing more than bookkeeping. But: a stable economy depends enough people having faith that money is 'real' and that debts have actual value, so I worry that tricks like this could undermine that, even if they don't cause runaway inflation directly.
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Old 07 January 2013, 07:44 AM
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It's simple. To get the problem under control, in the long run, US must export more than they import, something which has not happened for almost 30 years. As long as one spends more than one earns, the economy will have problems.
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Old 07 January 2013, 08:56 PM
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Glasses Debt in a Time of Zero

I’ve had communications from a number of people asking an interesting question relating to the debt ceiling and other issues: why does the Federal government have to borrow at all? Why can’t it just print money to pay its bills? After all, haven’t people like me been saying that this isn’t actually inflationary?

Now, it turns out that there really is a problem, or actually two problems — but they’re a bit subtle.

http://krugman.blogs.nytimes.com/201...-time-of-zero/
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Old 07 January 2013, 09:38 PM
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Not necessarily related, but my husband received in the mail today a handful of 10 Trillion Dollar notes from the Reserve Bank of Zimbabwe. He said he paid a buck (US dollars, not sure if he meant each or for the lot) and I suspect that was much more than the actual exchange rate.

Regardless of the problems caused by inflation, it does give to printing some spectacular sounding money!
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Old 07 January 2013, 11:12 PM
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Icon102 'Joke' Solution to Debt Clash Gets Serious Study

What if Washington's next debt clash, widely expected to be as bitter as the "fiscal cliff" fight, could be resolved with the minting of a $1 trillion coin?

That is the idea being pushed by a handful of policy wonks and columnists, and it has caught the attention of lawmakers even though it is an unlikely solution.

http://online.wsj.com/article/SB1000...822313666.html
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Old 10 January 2013, 11:36 PM
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Default Meet the Genius Behind the Trillion-Dollar Coin

It was a December 2009 Wall Street Journal article that ultimately inspired the Georgia lawyer known online as “Beowulf” to invent the trillion-dollar coin.

The article, “Miles for Nothing,” detailed how clever travelers were buying commemorative coins from the U.S. Mint via credit cards that award frequent flier miles. The Mint would ship the coins for free and the travelers would deposit them at the bank, pay off their cards, and accumulate free miles.

More than six months later, during a wonky online discussion about the debt ceiling, Beowulf thought of the article and, egged on by fellow monetary-system obsessives, came up with his own clever plan to exploit the powers of the U.S. Mint.

http://www.wired.com/business/2013/0...coin-inventor/
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Old 11 January 2013, 09:21 PM
BrokenBiscuit BrokenBiscuit is offline
 
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Quote:
Can We Avert the Coming Debt Ceiling Crisis with a Magic Coin?
I don't know. Probably.

Economics makes me ill, there's people grinding out their 75 years in servitude to it and people at the other end playing silly buggers.
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Old 11 January 2013, 09:30 PM
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Can't we just borrow the Trillion Dollar Bill from Mr. Burns?
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  #17  
Old 13 January 2013, 12:39 AM
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Quote:
Originally Posted by JoeBentley View Post
Can't we just borrow the Trillion Dollar Bill from Mr. Burns?
I don't think he ever got it back from Castro.
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  #18  
Old 13 January 2013, 01:07 AM
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Quote:
Originally Posted by Tom o' Bedlam View Post
I don't think he ever got it back from Castro.
Hey he said "what trillion dollar bill?" What more you expect.
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  #19  
Old 13 January 2013, 05:53 PM
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Icon06 Treasury says 'no' to trillion-dollar coin

The trillion-dollar coin isn't going to save the day.

The U.S. Treasury says it won't mint the coin as a way of escaping the debt-ceiling crisis. The Federal Reserve also nixed the plan.

http://www.latimes.com/business/mone...,7251551.story
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  #20  
Old 13 January 2013, 06:24 PM
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I'm not a lawyer, so maybe I'm misunderstanding the law. But as far as I know, the Treasury would just have to do what it's told on this. And the whole point is to bypass the Fed, so I don't even get why they get a mention in the article. Am I missing something? Obviously the White House can take it off the table, but I don't think Bernanke or Geithner have much say in the matter.
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