Obama to pay US debt with trillion-dollar coins? Its not April 1st
http://rt.com/usa/news/trillion-dollar-debt-coin-353/
With the fiscal cliff averted for now, it’ll be a few weeks until the debt ceiling debate is the next major money issue in Washington. Luckily, some economists say that crisis can be curbed as well, and all it will take is one very valuable coin.
By February, the United States will once again reach its maximum borrowing amount from foreign nations — the debt ceiling — and the House of Representatives and Senate will be stuck deciding if it’s worth raising it once again or rallying for another solution. In recent days, an alternative approach — one that is almost all too perfectly bizarre — has been tossed around. It would involve minting a few trillion dollar platinum coins, and although it’s an unlikely answer, it’s all too legit.
The United States can’t just print paper money all willy-nilly every time it exhausts its borrowing options, but the US can, however, have a figurative field day when it comes to some types of coin.
As analyst Chris Krueger from Guggenheim Securities’ Washington Research Group explains to the American Enterprise Institute, “There are limits on how much paper money the U.S. can circulate and rules that govern coinage on gold, silver and copper. BUT, the Treasury has broad discretion on coins made from platinum.”
“Although the Treasury can’t just create money out of thin air to pay its bills, there is a technicality in the law that says the Treasury has special discretion to create platinum coins of any denomination, and the thinking is that [Secretary of the Treasury] Tim Geithner could make the coin and walk it over to the Federal Reserve and deposit it in the Treasury’s bank account,” adds Joe Weisenthal of Business Insider.
Although the idea seems outrageous, it’s been discussed repeatedly in the media since the start of 2013, and has even been brought up by an influential member of Congress.
“It sounds silly but it’s absolutely legal,” Rep. Jerrold Nadler (D-New York) tells New York Capital this week. “There is specific statutory authority that says that the Federal Reserve can mint any non-gold or -silver coin in any denomination, so all you do is you tell the Federal Reserve to make a platinum coin for one trillion dollars, and then you deposit it in the Treasury account, and you pay your bills.”
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this is not a hoax..carney is even speaking about it..a trillion dollar coin..its got to be some sort of legal loophole to get around the debt ceiling..needs to be followed closely..
401
Did he think about that before he multiplied and raised the debt up by billions? No president before Obama has spent more money than he has. This is like a slap in the face when you look at how much he spends. No it’s not April 1st but you would think it was, cause this sounds so laughable.
but gosh oh golly oh gee… lil’ ol’ me thought the federal reserve was part of the government – aint it??? so, if they’re buyin up all the debt, then we just owe that lil’ ol’ debt to ourselves. we oughtta be able to just wave a magic wand and make it go *poof*!
unless the federal reserve was actually private instead of being part of the government. that’d be a different story, by gosh.
we have debt..lets sell that debt so we have money to pay for things using debt and still have more debt accumulating..greatest ponzi off all time..
I know man, the federal reserve is privately owned, and is the greatest ponzi scheme ever. All it’s going to take is China to tell the U.S. to fuck off, and get out of the dollar, and our economy will collapse. That’s why it is so funny looking at the money that the U.S. spends. The dollar is going to collapse, and they know it.
This might be interesting as well:
https://jhaines6.wordpress.com/2013/01/07/ben-fulford-the-holiday-lull-is-over-the-fascists-days-are-numbered-january-8-2013/
Jct: The Argentine Solution involves governments issuing a trillion to pay workers with small-denomination bond credits. Thiis is issuing a trillion credit and then using all the rest of the money as change . It sure beats government borrowing a trillion from the banks and taxing you to pay the banks interest! So everyone stop laughing. Issuing a trillion dollars chip isn’t as smart as issuing a trillion in chips but they’ll find someway to make change.
http://www.sfgate.com/opinion/editorials/article/Trillion-dollar-coin-idea-is-worthless-4187798.php
The idea of a “trillion-dollar coin” came from the Internet, where a few political observers noted that the White House might be able to avoid the upcoming fight over our national debt ceiling by simply minting a platinum coin with a face value of $1 trillion.
Thanks to an obscure law that allows the Treasury to mint and issue platinum coins (it was designed for commemorative currency), the Treasury just might be able to issue a single coin, deposit it at the Federal Reserve of the Bank of New York to cover U.S. debt, and wait for Congress to come to its senses and pass an increase in the debt ceiling.
If the idea sounds crazy, that’s because it is. Unfortunately, the fact that Washington is gearing up for a fight over the debt ceiling is equally crazy – so the “mint the coin” movement moved from the Internet to the Beltway at warp speed, and it’s become an element of political strategy. At a Jan. 9 news conference, White House spokesman Jay Carney wouldn’t say that a coin was illegal or that the idea of minting one had been ruled out.
The coin might sound like a great idea to Democrats, who are rightly frustrated with House Republicans for threatening a showdown over the debt ceiling. And it would be absolutely calamitous for Congress to refuse to raise the debt ceiling, which would mean a U.S. default on bills to creditors all around the world. Failing to raise the debt ceiling would have massive consequences for the United States in terms of our credit rating, our interest rates, and our global credibility.
But the problem with the coin is that it takes a political problem – Congress’ inability to act responsibly – and turns it into a financial one. The United States can’t just print money just because Congress doesn’t want to behave responsibly. The world’s most powerful nation can’t afford to act that way.
“Minting the coin” comes with its own legal and political dangers, too. It could terrify investors, possibly leading to a dip in our credit rating and a spike in interest rates.
There’s no way out of this beyond political responsibility.
The United States can’t just print money
Jct: Why can’t the US just print money if they have the collateral to back it up?
the peasant’s change
http://4.bp.blogspot.com/-v5vOOAHoIBs/Tw-L6Rpy20I/AAAAAAAAL1Q/GW8WLZ4z5wQ/s1600/chuckecheese1982.jpg
thats about its value to!
“minting” a coin would really be “printing” money.
it’s funny because so many people go around squaking about how QE is “printing” – it simply isn’t. QE is the government going into debt, and the private federal reserve soaking up the underlying assets – about 4-5% of all assets in the US now, an enormous chunk.
in this amazing upside down world we live in, “printing” would actually be better than more QE. hell, print up a dozen of those suckers and they could wipe out a shitload of debt – lol – and leave the bondholders with bits of platinum. the initial effect would actually be deflationary. but then they would print another doze, and another, and then we really would would have zimbabwe-style inflation.
I just have this mental picture of one being misplaced or lost. A trillion gone in one hit
i believe the simpsons covered this…
lol
xxx: squawking about how QE is “printing” – it simply isn’t. QE is the government going into debt, and the private federal reserve soaking up the underlying assets – about 4-5% of all assets in the US now, an enormous chunk. in this amazing upside down world we live in, “printing” would actually be better than more QE.
Jct: My point exactly. If a chip must be issued from the bank, wouldn’t it be better to have our government issue it without having to tax us to pay any interest?
yup!
Ray Stevens – Obama Budget Plan .