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Lots Of Influential People Are Talking About The Trillion Dollar Coin Idea To Save The Economy
TBI ^ | 1-3-2013 | Joe Weisenthal

Posted on 01/03/2013 4:36:21 PM PST by blam

Suddenly, Lots Of Influential People Are Talking About The Trillion Dollar Coin Idea To Save The Economy

Joe Weisenthal
Jan. 3, 2013, 4:42 PM

This is really thrilling.

An arcane idea that started on finance blogs in the summer of 2011-- that Tim Geithner should mint a trillion dollar platinum coin to avert the debt ceiling -- is now seriously taking off.

The premise of the idea is this: 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, and the thinking is that Tim Geithner could make the coin and walk it over to the Federal Reserve and deposit it in the Fed's account.

The first blog to really promote the idea was Cullen Roche's Pragmatic Capitalist. We jumped on it soon thereafter, as did others. Of course, once the debt ceiling was solved, people forgot about it.

But there's a new debt ceiling looming, and this time, LOTS more people are talking about it.

We noted our surprise back in early December that an actual 3rd party research firm brought up the idea.

Now it's going even more viral.

Paul Krugman discussed it yesterday.

In an interview with Capitol New York, Representative Jerry Nadler came out in favor of the solution (Nadler has an above-average understanding of economics in our experience).

Josh Barro at Bloomberg is now endorsing it, and that's spread a huge conversation about it among DC journalists and policy folks on twitter.

Barro explains why it's the perfect "solution" to the debt ceiling fiasco:

Hitting the debt ceiling isn't an option. It's no way to run the country, and Republicans know that. So, a debt-ceiling increase shouldn't count as a "concession,"

(snip)

(Excerpt) Read more at businessinsider.com ...


TOPICS: News/Current Events
KEYWORDS: budget; debt; decefit; economy
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Hey...we pretend about everything else, why not the economy too.
1 posted on 01/03/2013 4:36:34 PM PST by blam
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To: blam

Okay, lemme guess, it’s “Three-Year-Olds Run the Economy Day”?


2 posted on 01/03/2013 4:39:40 PM PST by JennysCool (My hypocrisy goes only so far)
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To: blam

We should mint a lot of them. If Congress continues spending like Obama is a drunken sailor, then we’re all going to need those trillion dollar coins - for bus fare.


3 posted on 01/03/2013 4:42:51 PM PST by Pollster1 (Freedom is never more than one generation away from extinction. - Ronald Reagan)
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To: blam

The day the US Treasury prints a Trillion dollar coin, that will be the clearest signal yet to hoard gold, silver and ammunition, get rid of all paper assets, especially all Gov’t bonds, and make sure your loved ones are safe.

Because at that point, we will have become Zimbabwe.


4 posted on 01/03/2013 4:42:51 PM PST by PGR88
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To: blam

May as well simply print trillion dollar bills, it’s economically just as valid an exercise. I suggest Groucho Marx for the bills portrait.


5 posted on 01/03/2013 4:43:18 PM PST by muir_redwoods (Don't fire until you see the blue of their helmets)
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To: blam
Meh. Its only money.


6 posted on 01/03/2013 4:43:56 PM PST by Delta 21 (Oh Crap !! Did I say that out loud ??!??)
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To: blam

They stole that idea from the Simpsons. Monty Burns once had a Trillion Dollar bill.


7 posted on 01/03/2013 4:44:45 PM PST by Dutch Boy
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To: blam
the Treasury can't just create money out of thin air to pay its bills

No, we have the Fed to do that for us. sheesh.

8 posted on 01/03/2013 4:45:13 PM PST by hinckley buzzard
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To: blam

Great idea. Just mint and give one to every man, woman and child in America. Then let the feds tax it at 50%. Feds have scads of cash and everyone is a multi-billionaire. Win-win for all ... what could go wrong?


9 posted on 01/03/2013 4:45:20 PM PST by crusadersoldier
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To: Dutch Boy

Homer Simpson: “Here trilly, trilly, trilly....”


10 posted on 01/03/2013 4:53:03 PM PST by Fedupwithit (You gave him what he wanted. I gave him what he needed.)
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To: blam
Photobucket
11 posted on 01/03/2013 4:53:48 PM PST by Huskrrrr
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To: blam

Obama’s picture on one side and a picture of the DNC’s mascot on the other side. That will work!


12 posted on 01/03/2013 4:53:48 PM PST by Taxbilly
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To: blam
It would be interesting if these idiots actually try this, as it might destroy the carefully created perception that the dollar is actually worth anything.

The government has built a house of cards on the perception of value in the paper dollar, and a platinum coin the size of a silver dollar has more weight than that house of cards can support.

Once Joe Average figures out that sixteen of 'em represent payment for the ENTIRE US government debt, the platinum will hit the fan.

13 posted on 01/03/2013 4:55:26 PM PST by Navy Patriot (Join the Democrats, it's not Fascism when WE do it, and the Constitution and law mean what WE say.)
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To: Pollster1

On Obama spending like a drunken sailor....this is not true, drunken sailors spend their OWN money!


14 posted on 01/03/2013 4:55:35 PM PST by bigtoona
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To: PGR88
The day the US Treasury prints a Trillion dollar coin, that will be the clearest signal yet to hoard gold, silver and ammunition, get rid of all paper assets, especially all Gov’t bonds, and make sure your loved ones are safe.

That would be too late. The day that it is suggested that "the US Treasury prints a Trillion dollar coin" ... isn't quite too late (nudge nudge).

15 posted on 01/03/2013 4:58:12 PM PST by jiggyboy (Ten percent of poll respondents are either lying or insane)
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To: blam
from the article:

This would not result in massive inflation, because we wouldn't have a gigantic injection of new money into "the system." That is only achievable through massive spending beyond which the economy can handle.

*cough*

16 posted on 01/03/2013 5:01:10 PM PST by jiggyboy (Ten percent of poll respondents are either lying or insane)
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To: blam

These people are probably sitting around laughing their butts off. Why not? The American populace is stupid enough to believe it. Which makes them laugh even harder.

All they have to do is tell the MSM propaganda crew to go for it.


17 posted on 01/03/2013 5:01:51 PM PST by dforest
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To: blam
“the thinking is that Tim Geithner could make the coin and walk it over to the Federal Reserve and deposit it in the Fed's account.”

He'd probably drop it and lose it in a storm drain on the way over to the fed...

18 posted on 01/03/2013 5:02:30 PM PST by MRadtke (Light a candle or curse the darkness?)
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To: JennysCool

3 year olds playing 3 Card Monte

19 posted on 01/03/2013 5:04:46 PM PST by vbmoneyspender
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To: blam
Tim Geithner should mint a trillion dollar platinum coin

Not really too outlandish.

By the day Obama, Geithner and Bernanke are done it will take a Trillion Dollar coin to buy a used Ford Pinto.

The next day it will cost even more.


20 posted on 01/03/2013 5:08:09 PM PST by Iron Munro (I MISS AMERICA !)
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To: blam
In an interview with Capitol New York, Representative Jerry Nadler came out in favor of the solution (Nadler has an above-average understanding of economics in our experience).

Uh huh. In that same article, Nadler showed his "above-average understanding of economics" by saying that the part of the 14th Amendment saying that U.S. Civil-War debt is indeed debt, somehow means that Congress doesn't have a say in spending any more.

21 posted on 01/03/2013 5:14:38 PM PST by jiggyboy (Ten percent of poll respondents are either lying or insane)
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To: blam
"Nadler has an above-average understanding of economics in our experience"

Nadler has an above-average understanding of economics in our experience a fork & spoon.

22 posted on 01/03/2013 5:21:14 PM PST by carriage_hill ("I meant to say maggot, but I have a lisp.")
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To: crusadersoldier
Just mint and give one to every man, woman and child in America. Then let the feds tax it at 50%.

Which would also require the minting of a half-a-trillion dollar coin.

A "four bits-a-trillion" coin, so to speak...

23 posted on 01/03/2013 5:22:10 PM PST by okie01 (The Mainstream Media: IGNORANCE ON PARADE)
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To: blam
Ok...because ignorance is bliss sometimes...

What would be the difference if it was say ...gold?

Would using platinum deflate the value of hoarding gold?

Should we start buying platinum?

And would that move us from a fiat standard to a platinum standard and really screw-up all the other countries that have been hoarding gold?

24 posted on 01/03/2013 5:24:50 PM PST by EBH (0bama is guilty of willful neglect of duty.)
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To: blam

Stop spending our money overseas.

Start saving money here.

Enough idiot ideas. Save money now.


25 posted on 01/03/2013 5:26:57 PM PST by Cringing Negativism Network
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To: Pollster1

I WISH Zero would spend like a drunken sailor! As a former drunken sailor, I can tell you that I stopped when I ran out of money.


26 posted on 01/03/2013 5:29:32 PM PST by j_tull
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27 posted on 01/03/2013 5:32:10 PM PST by RedMDer (Those that believe in gun free zones should post gun free zone signs on their property and persons.)
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To: RedMDer

Yup. :D


28 posted on 01/03/2013 5:34:36 PM PST by Cringing Negativism Network
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To: blam

“New York, Representative Jerry Nadler came out in favor of the solution (Nadler has an above-average understanding of economics in our experience).”

Maybe if above-average means you have no clue how inflation, the money supply, or currency devaluation work.


29 posted on 01/03/2013 5:36:12 PM PST by Boogieman
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To: EBH

“What would be the difference if it was say ...gold?”

It wouldn’t be valid, because the loophole only applies to platinum.

“Would using platinum deflate the value of hoarding gold?”

No. In fact, if they pull this scheme, the value of the dollar versus gold will drop, effectively inflating the price of any gold you already own.

“Should we start buying platinum?”

Not unless you were already planning to. This won’t affect the price of platinum, except through inflation, like it will for any other valuable commodity.

“And would that move us from a fiat standard to a platinum standard and really screw-up all the other countries that have been hoarding gold?”

No, the coin may be platinum, but it is still a fiat currency. It will not be minted with one trillion dollars worth of platinum, that would defeat the entire purpose (to create money out of thin air). So, it’s no different in that respect than having fiat money made out of copper, zinc, or nickel.


30 posted on 01/03/2013 5:43:35 PM PST by Boogieman
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To: blam
I have actually heard this going back to when Reagan was president, and when democrats were complaining about all the debts he was racking up. One administration economist (might have been Laffer) said if anyone demanded payment, they would print up a trillion dollar bill and pay it off.

There are actually signs that the democrats fully intend to do domething like this. Obama is acting as if he wants to start inflation, by not reducing spending, by giving people raises, by encouraging strikes for more wages. All of these have the intent of forcing prices to rise, but they will fail in today's economy.

If inflation occurs, then interest rates should rise, which means that we would then be forced to default on our debt. So, he would need a way to increase the money supply without borrowing from the federal reserve. Which means the treasury would have to print it.

31 posted on 01/03/2013 5:50:59 PM PST by Vince Ferrer
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To: blam

well they better print about 200 of them for all the fake derivative thin air money that’s about to crash.


32 posted on 01/03/2013 5:51:45 PM PST by Secret Agent Man (I can neither confirm or deny that; even if I could, I couldn't - it's classified.)
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To: blam
"An arcane idea that started on finance blogs in the summer of 2011-- that Tim Geithner should mint a trillion dollar platinum coin"

Must be some lame "Finance" blogs. Anyone with basic knowledge knows that Geithner can do no such thing, unless he was perhaps directed by Congress. The Congress could most certainly create a "Trillion Dollar Coin", as the Constitution provides them with the ability to coin money(NOT paper currency). Not sure who would accept such a coin as payment though. It would be worth it's melt value in Platinum I would think. lol

33 posted on 01/03/2013 6:06:21 PM PST by KoRn (Department of Homeland Security, Certified - "Right Wing Extremist")
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To: BartMan1; Nailbiter; stanley windrush
If you haven't seen it, this is the latest lunacy from the left.

God help us.

34 posted on 01/03/2013 6:09:41 PM PST by IncPen (Educating Barack Obama has been the most expensive project in human history)
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To: blam

This is the most stupid idea I’ve ever heard. To print a trillion dollar coin, but not put it into circulation means the coin is worthless except to collectors of rarity. It’s very existence might however lead to a devaluation of the dollar with respect to other currencies simply because of the distrust it demands. The Obama administration governs and leads by gimmicks and manipulation. Nothing is ever on the up and up with them. What is actually needed right now is for all of Congress to be sent home for 1 year and government not be able spend a damn dime during that time. People would then see that they can survive without government spending or Congess being in Washington. I mean it, not one dime.


35 posted on 01/03/2013 6:22:48 PM PST by lwoodham (I am Andrew Breitbart. Don't doubt me on this.)
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To: blam

Why stop with one or a few of those trillion dollar coins?

Why not mint 7 billion of them, and give one to each person in the world. That would make everybody instantly wealthy.

Then, there would be no need for government social programs, since there would be no poor people anywhere. And there would be no class-warfare, since there would be no middle-class and no poor class and no rich class. There would also be no buses or corporations, since nobody would have to work for a living. And, since rich people would not be envious of what others have, then perhaps there will never again be any wars.

The biggest benefit would be that, without the need to support wars or to support people, there would be no need for governments.

And, if anyone ever gambles away his/her trillion dollars, then, just minting another trillion dollar coin would make him/her wealthy again.

The people with the trillion dollar coin idea have just come up with the perfect solution to all the world’s problems. Let’s start minting today!


36 posted on 01/03/2013 6:24:53 PM PST by adorno (Y)
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To: blam
This is BRILLIANT!

You see, what the government can do is mint the coins, then pay off the debt to the Federal Reserve with them (being sure to get the receipt [notarized and triplicate], then refuse to honor the face-value of the coins citing the Constitution's provision that the states can only make gold or silver payment for debts.
IOW: Eat the debt fed!

37 posted on 01/03/2013 6:34:18 PM PST by OneWingedShark (Q: Why am I here? A: To do Justly, to love mercy, and to walk humbly with my God.)
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To: adorno

2nd paragraph correction:

“there would also be no businesses or corporations...”


38 posted on 01/03/2013 6:35:02 PM PST by adorno (Y)
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To: bigtoona
"On Obama spending like a drunken sailor....this is not true, drunken sailors spend their OWN money!"

Reagan - Unfair To Drunken Sailors

39 posted on 01/03/2013 6:50:52 PM PST by blam
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To: blam

File this under “magical thinking”. Kind of like the Fed thinking it can print its way out of a recession.


40 posted on 01/03/2013 6:52:31 PM PST by Flick Lives (We're going to be just like the old Soviet Union, but with free cell phones!)
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To: blam

It’s a great idea and all, but what happens if he’s walking it over to the treasury, passes a vending machine and realizes he does have any other change?


41 posted on 01/03/2013 7:02:24 PM PST by stevio (God, guns, guts.)
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To: blam

“Everything about socialism is sham and affectation.” - 23.11; Ch23; Economic Harmonies; Frederic Bastiat 1801-1850

Eliminate the FED. Swing Bernanke & Geithner from a lamp post.

Problem solved.


42 posted on 01/03/2013 7:07:56 PM PST by PGalt
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To: blam
Anybody besides me remember the House Post Office scandal?

Congressmen would buy a small ticket item, like a pack of gum or book of stamps, at the House Post Office, write the cashier a check for hundreds/thousands of dollars, then pocket the change. The checks were never cashed, and the taxpayers refilled the till.

That was so long ago, now why did that event pop into my head? Maybe because a made-up coin that never circulates has the same value as a check you never cash - none. And anyone who makes money based on the value of either one is A CROOK.

43 posted on 01/03/2013 7:18:42 PM PST by ZOOKER ( Exploring the fine line between cynicism and outright depression)
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To: blam

Expanding the money supply doesn’t save the economy. It ruins the economy. The point of the coin is to preserve the government’s ability to buy elections and redistribute wealth.


44 posted on 01/03/2013 7:22:29 PM PST by Hoodat ("As for God, His way is perfect" - Psalm 18:30)
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To: blam
Paul Krugman discussed it yesterday.

Paul Krugman is an idiot.

Representative Jerry Nadler came out in favor of the solution

Gerold Nadler is an idiot.

Josh Barro at Bloomberg is now endorsing it

Josh Barro isn't even smart enough to be considered an idiot. If you ask his dad Robert what he thinks about it, he would say that his son needs to shut up about things he knows nothing about.

45 posted on 01/03/2013 7:35:29 PM PST by Hoodat ("As for God, His way is perfect" - Psalm 18:30)
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To: EBH

The difference is that gold and silver are regulated where as platinum is not.

So the treasury could not mint a trillion dollar gold coin because it would have to have trillion dollars worth of gold in the coin.

Effectively this would fix the price of platinum in the US at hugely high levels. Thus, it might be a good idea to buy some now because you could be a trillionaire with a couple of thousand dollars investment

However, doing this would make the dollar worthless. So you’d have a trillion of them an be able to buy a loaf of bread. This would in effect, exponentially devalue the dollar.

The people who should really be upset about this are the holders of US debt like the Chinese and Arabs. It would mean that the Arabs had given the US all that oil because they sold it in 1990 dollars which are now worth 0.000001 of the value at the time.

So in a perverse way this would not only get rid of the deficit problem but the trade imbalance as well.

It would in my view probably lead to war but the very least wold mean no country would import goods to the US, from the US or buy the government bonds. Ask yourself; “If someone owed you money and said they were going to pay back 1/10,000,000 of it would you be happy? Would you do something to prevent that.

If Geitner does this the entire financial system of the US will collapse.


46 posted on 01/03/2013 7:40:29 PM PST by Fai Mao
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To: PGR88

Unless the trillion dollar plantinum coin weighs 20,000 tonnes, then it might actually work.


47 posted on 01/03/2013 7:49:25 PM PST by Oztrich Boy (I think, therefore I am what I yam, and that's all I yam - Rene "Popeye" Descartes)
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To: blam
A legal loophole allows the minting of platinum coins of any value. Mint two of these babies and voila! -- no deficit.
48 posted on 01/03/2013 7:56:52 PM PST by TBP (Obama lies, Granny dies.)
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To: blam

Knowing Hermie, he’d probably use the thing for bus fare on the way to the Fed.


49 posted on 01/03/2013 7:58:49 PM PST by TBP (Obama lies, Granny dies.)
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To: ZOOKER

Forgot about that but thanks for the reminder. Didn’t many of them write hot checks also?


50 posted on 01/03/2013 8:12:35 PM PST by Rusty0604
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