one trillion dollar coin

[ReconRat]

Wut? It's that pesky debt ceiling again. We're up against it without spending cuts or enough increases in revenue. And we've reached the limit of printing new paper money and coinage to dilute the debt owed.

So somebody finds a loophole, we're allowed to mint no limit on platinum coins.

Ergo, the trillion dollar coin. It never goes into circulation, it gets held at the mint (or treasury). But it would technically push the debt ceiling off by one trillion dollars.

Which of course, we'd be fools to go and spend our way back up to that same debt ceiling again, but you know that is what would happen.

What the Hell is wrong with people?

Google news: one trillion dollar coin

Edited January 5, 2013 by ReconRat

[smashweights]

Can't we just print off 16 of them and be done with the debt entirely?

[max power]

Only if you want your cash to be worth 0 and your debt to be worth 16 trillion times what it is currently.

[ReconRat]

When some people heard of the trick plan, they did indeed suggest minting several of them for multiple trillions of dollars of debt relief. It's up to the president, I guess. I don't think anything has come up in congress. Be right back, I'll take a look.

edit: nope, no bills or resolutions introduced for platinum or trillion.

[jbot]

Please let me rack up as much fixed debt, and spend all my cash before hand

[ReconRat]

Voodoo Economics

Might as well put the fraken' trillion dollar coin on a fraken' pedestal,

and dance a fraken' dance around it in fraken' glory.

Give me a fraken' break.

[Revelstoker]

The debt issue is not as bad as everyone makes it out but it is not good either.

Almost 50% of the debt is held by the US for US citizens. So, essentially we borrow to pay ourselves back. Social Security and Fed make up most of this.

The other 50% isn't quite as heinous either as much of it is held by investors or banks. A portion is held by other countries and that is where we can get into trouble.

Deficit spending is the real issue and the quicker we get any meaningful spending cuts, the better. Hear that Military!!!!

T coin would not destroy the purchasing power of the dollar so long as the coin never makes it into circulation.

[Gump]

It seems really hard to find the truth about the national debt.

http://www.cbsnews.com/8301-503544_162-57400369-503544/national-debt-has-increased-more-under-obama-than-under-bush/

[Revelstoker]

this site does a pretty good job of laying it out.

http://www.justfacts.com/nationaldebt.asp

When looking at the national debt it there are two thing really to focus on. Composition and rate of change (growth/decrease vs. rate of growth in GDP)

Composition - the first thing to do is separate the total debt into Public vs Federal debt.

Federal debt can largely be ignored as this is debt held by the Federal Reserve, Social Security and other govt. trust. In other words, this is debt held by us for us.

Public debt is the portion not held by US. Gov. agencies. There are plenty of legitimate (insurance companies, banks, corporations, investors,...) holders of this debt and this also includes foreign holders.

The size of the debt is troubling but the causes of the debt are far more serious and controllable.

[Revelstoker]

It seems really hard to find the truth about the national debt.

http://www.cbsnews.com/8301-503544_162-57400369-503544/national-debt-has-increased-more-under-obama-than-under-bush/

Just like the media to take a condition out of context to support some personal political choice.

Quick review of history clearly shows the rapid rise in debt during the Reagan years. A slower increase under Clinton (actually had a surplus) and then a rapid increase under W. Bush that continued under Obama. http://zfacts.com/p/318.html

Clinton's tight monetary policy actually put the economy in a rather precarious position. W. tax cuts hurt revenue generation and then Bernanke needlessly raising interest rates put the final nail in the coffin on the economy.

3 wars under Bush(s) rule, media fed economic/financial collapse, decreased revenue and increased social spending have all managed to balloon the debt to levels not seen since WW2. Sad part, is that monetary policy is not going to solve this issue. Increase spending (shift on how it is spent now) combined with roll back on W. tax cuts are going to be needed to stimulate the economy.

Corrective fiscal policy is something sorely missing in this whole discussion with no clear end in site. US is going to follow in the footsteps of Japan until some folks are willing to make the tough choices to fix the issues and create new opportunities. Time for the country to eat their veggies and take the medicine - no matter how bad it tastes.

[ReconRat]

A debt increase during and after a war is expected.

We used to be smart enough to pay it off.

[jbot]

oh, are we doing the "blame it on a particular political party" game now?

how great.

[Gump]

Yes, it's as productive as sarcasm.

[OsuMj]

Who wants to steal it with me?

[twowheelsnake]

We ARE in debt to the Federal Reserve revstroker! It's a private bank, NOT a government entity. They are running the biggest Ponzi scheme in the world. Get rid of the Fed, solve the problem

[ReconRat]

Yes, all political parties are involved. It's a "point the finger at the other guy" game.

That public vs federal debt thing in RevelStoker's link is interesting.

edit: reading it again, the link is very good.

http://www.justfacts.com/nationaldebt.asp

In defense of our current condition, all the countries of the world apparently are in the same condition (or worse). Doesn't make it right, but apparently in order to compete and survive in a world market, this is the result of competition.

Lighten up, world... take a break.

edit: err... it appears that the world thinks increased Gross Domestic Product is the solution. I'm sure there is a saturation limit. The reverse solution is less people to provide for, or less revenue spent on providing. Neither seems to be viable. The middle ground solution is more productivity from the population as it currently exists. Meaning "we the people" can work our way out of this. I wish us luck. My opinion is we need more engineers and scientists, creating wonderful inventions that the rest of the world must have. There might be no limit to that course of action.

Edited January 6, 2013 by ReconRat

[ReconRat]

Who wants to steal it with me?

I'm sure it would be heavy, so I picture it being rolled away.

Just aim it downhill and pick it up when it stops.

Don't get in it's way, you wouldn't want to be flattened by a trillion dollars.

[OsuMj]

I'm sure it would be heavy, so I picture it being rolled away.

Just aim it downhill and pick it up when it stops.

Don't get in it's way, you wouldn't want to be flattened by a trillion dollars.

great point.

$1,000,000,000,000 / $1555/oz (current rate)= 643 million oz.

643 million oz/ 32000 oz/ton = 20,096 tons

Do we even have that much platinum in the US? Or would we need to get it from other countries? lol.

I have a feeling using up our platinum supplies on a coin would make the catalytic converters in our cars extraordinarily expensive.

this is silly.

Although, death by money does sound unique.

[ReconRat]

LOL, it wouldn't be real value metal. It would only be representative. I mean, paper money is worth paper, after all.

So it would be a "token coin". har har

edit: besides, they are trying to get out of debt. Buying that much platinum would not work out.

hell, they could take a manhole cover and plate it with a thin coat of platinum, and tell us they've got it covered.

Edited January 6, 2013 by ReconRat

[OsuMj]

LOL, it wouldn't be real value metal. It would only be representative. I mean, paper money is worth paper, after all.

So it would be a "token coin". har har

Yeah, I read somewhere that they can designate any value that they want.... sounds legit.

[Revelstoker]

We ARE in debt to the Federal Reserve revstroker! It's a private bank, NOT a government entity. They are running the biggest Ponzi scheme in the world. Get rid of the Fed, solve the problem

OH REALLY? Yes, I know why you call it a "private" bank but it is about as private as government accounting is accounting. The Federal Reserve has a role to play, just as every other Central Bank in every other country and it plays it well.

Getting rid of the Federal Reserve is a statement for attention seeking politicians, Fox News and the ignorant masses. Do you really know what Federal Reserve's day to day functions are?

The primary motivation for creating the Federal Reserve System was to address banking panics.[3] Other purposes are stated in the Federal Reserve Act, such as "to furnish an elastic currency, to afford means of rediscounting commercial paper, to establish a more effective supervision of banking in the United States, and for other purposes".[24] Before the founding of the Federal Reserve System, the United States underwent several financial crises. A particularly severe crisis in 1907 led Congress to enact the Federal Reserve Act in 1913. Today the Federal Reserve System has responsibilities in addition to ensuring the stability of the financial system.[25]

Current functions of the Federal Reserve System include:[12][25]

• To address the problem of banking panics
  
• To serve as the central bank for the United States
  
• To strike a balance between private interests of banks and the centralized responsibility of government
  
  • To supervise and regulate banking institutions
    
  • To protect the credit rights of consumers
    

  [*]To manage the nation's money supply through monetary policy to achieve the sometimes-conflicting goals of

  • maximum employment
    
  • stable prices, including prevention of either inflation or deflation[26]
    
  • moderate long-term interest rates
    

  [*]To maintain the stability of the financial system and contain systemic risk in financial markets

  [*]To provide financial services to depository institutions, the U.S. government, and foreign official institutions, including playing a major role in operating the nation's payments system

  • To facilitate the exchange of payments among regions
    
  • To respond to local liquidity needs
    

  [*]To strengthen U.S. standing in the world economy

Through FOMC, yes the Fed will buy and sell bonds as a mechanism for facilitating monetary policy. The Fed also lends money to member banks, holds reserves and audits banks for solvency. I still have a few buddies doing this last action if you want to talk with them.

Yes, the Fed has bought a tremendous amount of bonds to provide liquidity to the banking system. The gutting of Glass-Steagal by a republican house and democratic President created a tremendous burden and responsibility for bailout that should never have happened. CitiGroup, too big to fail = MY ASS!! Reality, big enough to destroy the WW economy is what the legislation created. So, if you need a whipping boy, blame the Congressmen, President and Treasury secretary (Rubin) for ramming this one up the US public's ass.

In short, the Fed insures financial stability of our banking system and keeps the wheels of government greased. Someone has to do it.

[Tpoppa]

Who wants to steal it with me?

Ocean's Fourteen?