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Insane: Liberals Contemplate $1 Trillion Platinum Coin to "Solve" Debt Limit Issue
Townhall ^
| 12/08/2012
| Guy Benson
Posted on 12/08/2012 10:32:31 AM PST by SeekAndFind
Welcome to Zimbabwe. This is not a parody -- it is an actual report from the Washington Post:
Some economists and legal scholars have suggested that the “platinum coin option” is one way to defuse a crisis if Congress can’t or won’t lift the debt ceiling soon. At least in theory. The U.S. government is, after all, facing a real problem. The Treasury Department will hit its $16.4 trillion borrowing limit by next February at the latest. Unless Congress reaches an agreement to raise that borrowing limit, the government will no longer be able to borrow enough money to pay all its bills. Last year, Republicans in Congress resisted lifting the debt ceiling until the last minute — and then only in exchange for spending cuts. Panic ensued. So what happens if there’s another showdown this year? Enter the platinum coins. Thanks to an odd loophole in current law, the U.S. Treasury is technically allowed to mint as many coins made of platinum as it wants and can assign them whatever value it pleases. Under this scenario, the U.S. Mint would produce (say) a pair of trillion-dollar platinum coins. The president orders the coins to be deposited at the Federal Reserve. The Fed then moves this money into Treasury’s accounts. And just like that, Treasury suddenly has an extra $2 trillion to pay off its obligations for the next two years — without needing to issue new debt. The ceiling is no longer an issue.
“I like it,” says Joseph Gagnon of the Peterson Institute for International Economics. “There’s nothing that’s obviously economically problematic about it.” In theory, this is much like having the central bank print money. But, says Gagnon, the U.S. government would simply be using the money to keep spending at existing levels, so it wouldn’t create any extra inflation. And if it did cause problems, the Fed could always counteract the effects by winding down some of its other programs to inject money into the economy. Is the platinum coin option really legal? Apparently so. It was discussed* during the 2011 debt-ceiling crisis by Jack Balkin, a law professor at Yale Law School. Under law, he noted, there’s a limit to how much paper money the United States can circulate at any one time, and there are rules that limit how many gold, silver and copper coins the Treasury can mint. But there’s no such limit when it comes to platinum coins.
I'm at a loss for words. I mean, you'd think that there's no way on earth the White House would even float anything like this, if only because of the massive political risk and insane optics. But I guess you never know; Obama did just ask Congress to relinquish all of its debt limit-related powers to him, after all. It's difficult to identify the most mind-blowing element of this article, but economist Joseph Gagnon's quote might take the cake. There's "nothing that's obviously economically problematic" about this absurd scheme? Printing, or rather minting, $2 trillion in magic money, overnight, to artificially "pay for" existing federal obligations isn't "economically problematic"? In that case, we should print $87 Trillion in special coins and retire all of our accrued debts and obligations in one fell swoop. I'm sure the massive devaluation of the dollar, inflationary spikes, and total loss of confidence among our creditors would work themselves out somehow. Thank goodness for experts.
TOPICS: Breaking News; Editorial
KEYWORDS: 1trillion; coin; cookedthebooks; cultureofcorruption; currency; debtlimit; democrats; inflation; obama; obamascandals; platinum; platinumcoin; platinumcon
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To: SeekAndFind
So what happens when they actually mint the damned thing and post pictures on the news site and some creative individual with a milling machine and small bar of platinum load the image into a 3-D model and “mint” the damned thing then sell it to a country that hates us and that country takes it and demands payment in full?
Or china makes duplicate coinage?
Wouldn’t be the first time china has made fake coins... That we know of....
This idea is dumb dumb dumb....
To actually be any value the coin itself would need be made up of 90 cubic METERS of platinum!
So ball park estimate that is enough platinum to fill a decent sized football stadium up like a giant bowl of platinum soup or a coin the size of most large metro areas!!!!
That is if you wanted to stay honest about the amount of platinum in the coin ACTUALLY representing the VALUE of the coin!
Anything else is a complete debasement of the currency and will lead to hyper inflation...
41
posted on
12/08/2012 1:00:40 PM PST
by
GraceG
To: coloradan
Some platinum is more equal than other platinums. But so long as they can mint a coin out of platinum that is worth $1 trillion, they could print it on paper, too. After all, the melt value of the platinum (even if $60 million because its a ton) is negligible compared to the $1 trillion just like the burn-value of the paper would be. Yes, the choice of platinum is to imply value, as everyone knows that its face value is a joke. They should print it on toilet paper.
42
posted on
12/08/2012 1:01:54 PM PST
by
SampleMan
(Feral Humans are the refuse of socialism.)
To: SeekAndFind
There’s some rich mineral deposits near Ely Minnesota.
Maybe the government can use some of it.
I’m trying to remember if platinum is on the list; I recall reading some mineral starting with “p”.
43
posted on
12/08/2012 1:03:05 PM PST
by
WildHighlander57
((WildHighlander57 returning after lurking since 2000))
To: hinckley buzzard
A Mad Dean allusion.
Nice.
44
posted on
12/08/2012 1:03:56 PM PST
by
Flycatcher
(God speaks to us, through the supernal lightness of birds, in a special type of poetry.)
To: SeekAndFind
Why not just stamp one TWO trillion dollar coins instead of a pair of one trillion dollar coins. They still print $2 bills for some reason.
45
posted on
12/08/2012 1:20:52 PM PST
by
Terry Mross
(I haven't watched the news since the election. Someone ping me if anything big happens.)
To: SampleMan
[ Then why stop there Mr. Gagnon? Make a $20 trillion coin, pay off the debt, and cancel all taxes for the next two years. After that, we just strike a $5 trillion coin annually and live like kings! ]
Yay! we can all spend our time finger painting and singing nertsery rhymes and eatin s’mores and playing hide and seek!
No one need ever work again except to mint a new coin every now and then!!!
Seriously do these people to me seem to have less understanding of the economy than a kindergarten student????
46
posted on
12/08/2012 1:25:54 PM PST
by
GraceG
To: SeekAndFind
Once upon a time, the smartest people in the country would apply all their brain power in a serious fashion to actually solve real problems.
It’s an indictment of the times we live in that the people in charge apply all their brain power to come up with the cleverest methods they can to *avoid* solving serious problems.
If this crowd was around during World War II, I’d expect them to have built a cardboard cut-out in the shape of “Fat Man” and then claim they were working on the design of an atomic bomb.
47
posted on
12/08/2012 1:33:38 PM PST
by
Stosh
To: SeekAndFind
Well, our national default that these guys are working overtime to draw nearer, is likely to take some face-saving form like this.
And we have the Marine Corps to make the rest of the world play along.
48
posted on
12/08/2012 1:33:52 PM PST
by
annalex
(fear them not)
To: SeekAndFind
Liberals Contemplate $1 Trillion Platinum Coin to "Solve" Debt Limit Issue
49
posted on
12/08/2012 1:52:09 PM PST
by
Bobalu
(It is not obama we are fighting, it is the media.)
To: SeekAndFind
He’s going to do that for the entire two or four years?
One side will give in between now and then and we can guess which one it will be from past experience.
How about some more automatic delayed Military cuts like with the last deal? Look how well that worked for the GOP . Maybe this time the GOP can demand some (more) automatic delayed tax increases too.
50
posted on
12/08/2012 1:54:10 PM PST
by
sickoflibs
(Dems know how to win. Rs know how to whine.)
To: SeekAndFind
At least this should give us a whole new admiration for the Greeks, who, even in their darkest economic hours over the past few years never turned to insane economists to try to solve their problems. There’s hope for them, but I’m not sure about us.
If the U.S. government runs out of money, all it will have to do to avoid bankruptcy is declare a week or two of unpaid leave for all non-essential Federal employees, that is, the great majority of them.
That would give Congress enough time to pass a law declaring that all non-essential Federal workers who retire or leave for other reasons would not be replaced until our budget was in better condition.
To: GeronL
52
posted on
12/08/2012 2:02:01 PM PST
by
Bobalu
(It is not obama we are fighting, it is the media.)
To: mikrofon
One Toony made of platinum to be worth 100 trillion would likely consist of the entire world’s supply of that metal ...
53
posted on
12/08/2012 2:04:02 PM PST
by
PIF
(They came for me and mine ... now it is your turn ...)
To: SeekAndFind
Send one of the coins to China with a note that it is payment in full for the value of the bonds it holds.
Beam me up Scotty, I'm ready to go!.
54
posted on
12/08/2012 2:07:06 PM PST
by
Bobalu
(It is not obama we are fighting, it is the media.)
To: Bobalu
Yep. It seems as if that is what has happened!
55
posted on
12/08/2012 2:16:14 PM PST
by
GeronL
(http://asspos.blogspot.com)
To: SeekAndFind
Make more money. That won’t cause hyper-inflation. Honest.
56
posted on
12/08/2012 2:23:10 PM PST
by
Eleutheria5
(End the occupation. Annex today.)
To: hinckley buzzard
Economic collapse starts when a coin accidentally rolls off the counting table and disappears down a drainage grate.
57
posted on
12/08/2012 2:26:21 PM PST
by
Eleutheria5
(End the occupation. Annex today.)
To: SeekAndFind; P-Marlowe
It seems to me that the clear intent of the US Constitution is that the US Congress, particularly the House, initiates entirely new monetary resources.
No matter how you cut it, a trillion dollar coin is new resources.
Also, any effort to assign the value of a trillion dollars to a coin flies is fraud. The market price of platinum is available for all to see, the historic price is available, and the futures price is available.
For anyone to claim they have a trillion dollars worth of platinum would require that they have more than a single coin or that the single coin be the size of a mountain.
Otherwise, they are perpetrating fraud.
58
posted on
12/08/2012 3:05:08 PM PST
by
xzins
(Retired Army Chaplain and Proud of It! True supporters of our troops pray for their victory!)
To: SeekAndFind; P-Marlowe
It seems to me that the clear intent of the US Constitution is that the US Congress, particularly the House, initiates entirely new monetary resources.
No matter how you cut it, a trillion dollar coin is new resources.
Also, any effort to assign the value of a trillion dollars to a coin flies is fraud. The market price of platinum is available for all to see, the historic price is available, and the futures price is available.
For anyone to claim they have a trillion dollars worth of platinum would require that they have more than a single coin or that the single coin be the size of a mountain.
Otherwise, they are perpetrating fraud.
59
posted on
12/08/2012 3:05:36 PM PST
by
xzins
(Retired Army Chaplain and Proud of It! True supporters of our troops pray for their victory!)
To: SeekAndFind; P-Marlowe
It seems to me that the clear intent of the US Constitution is that the US Congress, particularly the House, initiates entirely new monetary resources.
No matter how you cut it, a trillion dollar coin is new resources.
Also, any effort to assign the value of a trillion dollars to a coin is fraud. The market price of platinum is available for all to see, the historic price is available, and the futures price is available.
For anyone to claim they have a trillion dollars worth of platinum would require that they have more than a single coin or that the single coin be the size of a mountain.
Otherwise, they are perpetrating fraud.
60
posted on
12/08/2012 3:06:48 PM PST
by
xzins
(Retired Army Chaplain and Proud of It! True supporters of our troops pray for their victory!)
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