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 Replies: 17 / Views: 3,866 |
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Pillar of the Community
Canada
838 Posts |
Have you seen this?! Apparently, minting one or two "trillion dollar coins" is a plausible way out of the debt-ceiling debate.  Quote:
Sovereign governments such as the United States can print new money. However, there's a statutory limit to the amount of paper currency that can be in circulation at any one time.
Ironically, there's no similar limit on the amount of coinage. A little-known statute gives the secretary of the Treasury the authority to issue platinum coins in any denomination. So some commentators have suggested that the Treasury create two $1 trillion coins, deposit them in its account in the Federal Reserve and write checks on the proceeds. Link removed and quote added by Staff as to keep this from turning into a political thread |
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Pillar of the Community
United States
2651 Posts |
thats insane....adding a Trillion dollars out of thin air would make the US dollar plummet..
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Moderator
 Australia
16808 Posts |
This idea made the news here in Australia... one of those "only in America" pieces our media seems to like showing.
No country has ever struck a coin with a face value 1/10th of the gross national product. The risks, with regard to such coins being lost, stolen, or counterfeited, would far outweigh the benefits.
If such a bold move were in fact undertaken, I think the end result would be a collapse in the value of the dollar to the point where a trillion dollars would be roughly equivalent to the bullion value of the coin.
Don't say "infinitely" when you mean "very"; otherwise, you'll have no word left when you want to talk about something really infinite. - C. S. Lewis
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Pillar of the Community
United States
931 Posts |
I think they have printed a trillion this year if I'm not mistaken. What's the difference between a football field of pallets full of $100 bills and a trillion dollar coin? They would probably save millions by making the coin and drawing checks from it.
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Bedrock of the Community
United States
17884 Posts |
Quote:
However, there's a statutory limit to the amount of paper currency that can be in circulation at any one time. I don't believe this is true any longer. Quote:
A little-known statute gives the secretary of the Treasury the authority to issue platinum coins in any denomination. Not true, the denominations are carefully specified. Quote:
So some commentators have suggested that the Treasury create two $1 trillion coins, deposit them in its account in the Federal Reserve and write checks on the proceeds. Possible, but they would have to write and pass legislation to authorize this new denomination. But if they did they could strike the coin "deposit" the seigniorage in the general fund. It would eventually have the same effect though as simply dumping unlimited fiat currency on the market and result in the collapse of the dollar. |
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Pillar of the Community
United States
4778 Posts |
This trillion dollar coin that would be used only by the gov't reminds me of the 500,000 dollar bill that was only used between fed banks way back when. But yeah, minting trillion dollar coins just sounds way to easy, at least for me.
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Pillar of the Community
United States
4846 Posts |
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Bedrock of the Community
United States
19931 Posts |
If that were to happen, kiss your cash goodbye because it'd be almost worthless.
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Pillar of the Community
United States
4778 Posts |
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Pillar of the Community
United States
2589 Posts |
There are otherways of getting around the laws about making federal reserve notes, for example the president can order the printint of United States Notes which are direct writs against the treasury and have nothing to due with the fed. President Lincoln created the United States Note specifically to raise revenue during the Civil War and it was used as a modest means of controlling the nations money supply before the creation of the Federal Reserve.
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Pillar of the Community
United States
4132 Posts |
It should be noted that nobody with the power to do this is actually considering doing this - it's just speculation about hypotheticals by pundits and bloggers.
But if the Fed doesn't want to create looser monetary policy by way of two trillion dollar coins, they could unwind the recent rounds of quantitative easing. They're holding a couple trillion in securities; they could sell those back to investors and pull the two trillion back out of the economy. Easy peasy.
OK, it's crazy, but it's probably better than just not paying the bills. Maybe?
So who do we put on the trillion dollar coin? I'm always a fan of going back to the Greco-Roman style - how about Narcissus?
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Pillar of the Community
United States
1348 Posts |
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Pillar of the Community
United States
2589 Posts |
The other thing we could do is derecognize the People's Republic of China and instead recognize the Republic of China (Taiwan) and come up with an agreement with the ROC government to cut the amount of money we owe to the chinese in half or even less. I'm sure the taiwanese would be willing to play along for hundreds of billions of dollars that would otherwise go to the PRC.
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Pillar of the Community
United States
1450 Posts |
I don't really think I want to get another several billion people mad at us! If we did that we would have to invade them and take their stuff and tell them it's for their own good,and I don't think we can afford that right now!
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Pillar of the Community
United States
2589 Posts |
We dont have to invade them all we have to do is send them a letter. And their isn't very much they could do about it at this point either. It wouldnt cost us anything and save us at the very least half a trillion dollars.
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Pillar of the Community
3352 Posts |
Well, I don't know about you guys, but I just completed my Whitman billion dollar coin set album, so I am totally psyched to get going on my my trillion dollar coin set! ... so I've put myself on the pre-order list ...
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Replies: 17 / Views: 3,866 |
Posted 07/29/2011 05:48 am
