Fiscal conservatives flip their shit in 3... 2...

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Eastoff

Eastoff

But it was a beginning.
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http://krugman.blogs.nytimes.com/20...t-that-coin/?smid=tw-NytimesKrugman&seid=auto

1
There’s a legal loophole allowing the Treasury to mint platinum coins in any denomination the secretary chooses. Yes, it was intended to allow commemorative collector’s items — but that’s not what the letter of the law says. And by minting a $1 trillion coin, then depositing it at the Fed, the Treasury could acquire enough cash to sidestep the debt ceiling — while doing no economic harm at all.
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wow, just, wow..so not the gov wants to produce monopoly money..talk about new math..
 
how big does that coin have to be? And why Platinum? Platinum is running less than gold right now (1650 vs. 1550/oz.)
 
btw: the first ones to try to make platinum coins? 19th-century Russians.
 
I think congress has to vote on whose likeness is on such a coin. It would be killed in the House.

I don't see how printing $1T worth of money (coin) out of thin air does no harm at all.
 
BrianFromWA said:
how big does that coin have to be? And why Platinum? Platinum is running less than gold right now (1650 vs. 1550/oz.)
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Maybe Im reading it wrong but I dont think that part matters. It wont be the metal value, it will be the coin value. Kind of like a current quarter's melt value is less than the coins worth or old gold coins melt value is more than the currency value. Some interesting numbers though....

There is roughly 133 tons of mined platinum in the world, at 29,167 troy onces per ton and 1550per ounce than there is only 3,879,211 ounces of platinum equaling $6,012,777,050 in the whole world. They say its only enough platinum to fill an average livng room.

http://www.penoir.com/platinum.htm

(hope my math is right that was pretty quick calculations by me)
 
the reason I ask is that it's pretty accepted that a quarter can be redeemed for a quarter's worth of value. I'm not sure you can go to China and say "here's a 1T coin, gimme $1T of my T-bills back!"
 
Im kind of spinning my head around how that would work also and how it could effect our currency. Its a new thought to me. China may acccept it if its a verified currency that we are obligated to take back as legal tender. As to why it has to be Platinum an not Gold or even Silver, my guess is that the loop hole in the law only extends to platinum but thats just a guess.
 
I think the scam is to mint the coin and deposit it in the treasury, then write checks against it.
 
Denny Crane said:
I think the scam is to mint the coin and deposit it in the treasury, then write checks against it.
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so does this just a back door to devaluating our currency? Why stop at a trillion, cant we just pay our whole debt this way?
 
Denny Crane said:
I think the scam is to mint the coin and deposit it in the treasury, then write checks against it.
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Scam is 100% accurate. It is the same as printing monopoly money. Unless you are backing that amount with actual gold, silver or other precious metals, then it's not worth it. The only way it could gain value is if the Treasury actually sold the coins to collectors for more than it's face value. Then and only then will a 10% platimum coin be worth more than 50 cents.
 
Lib's always get the blame for big spending, repulicans are just as guilty though they just have different spending agenda. Its a government problem.

Interesting slightly offtopic video of the largest gold coin ever minted (as of 2007 anyway) 1 kilo worth of gold. damn
 
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donkiez said:
so does this just a back door to devaluating our currency? Why stop at a trillion, cant we just pay our whole debt this way?
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We have been paying a lot of our debt this way. Debt that would otherwise have been run up and accounted for if it were part of the budget process. Instead, the Fed has printed near $3T in new money the past ~4 years, and used it to buy existing debt (T-Bills, corporate bonds, mortgages). Debt monetization. Where there once was debt, there is now inflated currency.
 
Denny Crane said:
We have been paying a lot of our debt this way. Debt that would otherwise have been run up and accounted for if it were part of the budget process. Instead, the Fed has printed near $3T in new money the past ~4 years, and used it to buy existing debt (T-Bills, corporate bonds, mortgages). Debt monetization. Where there once was debt, there is now inflated currency.
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So it is just a fancy way of keeping the status quo and passing the buck. Figures.
 
nice coin One million face value..todays gold value is at 52.19 canadian per gram..
 
blazerboy30 said:
Do you really think only fiscal conservatives should find this disturbing?
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No kidding; even a pinko like me is queasy over this. The world is functioning because of the shared delusion that our currencies have value. Eventually, if steps like this become common, there will be no confidence in currency value, period.

Of course, by then we may be milking goats and bartering it for eggs, so it might not matter.
 
BlazerCaravan said:
No kidding; even a pinko like me is queasy over this. The world is functioning because of the shared delusion that our currencies have value. Eventually, if steps like this become common, there will be no confidence in currency value, period.

Of course, by then we may be milking goats and bartering it for eggs, so it might not matter.
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Yeah I should have saved my dig on another anti-liberal thread. The reality is pretty simple, regardless of which wing you sit. If you make 20k, have 100k in debt, and borrow 30k per year to help pay the debt and more spending; something will eventually give.

When money was backed by precious metals; it was much easier to get a handle of true value. This revolving debt and backing by "loans or investments" will eventually fail. And when that time comes, shit is really going to hit the fan.
 
westnob said:
no, I just thought there would be a more visceral reaction from that side.
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Ah, so you were trolling. Gotcha.

Anyway, like Denny said, it isn't like we haven't already been doing this by printing our own money. This is just a little more extreme example.
 
magnifier661 said:
Yeah I should have saved my dig on another anti-liberal thread. The reality is pretty simple, regardless of which wing you sit. If you make 20k, have 100k in debt, and borrow 30k per year to help pay the debt and more spending; something will eventually give.

When money was backed by precious metals; it was much easier to get a handle of true value. This revolving debt and backing by "loans or investments" will eventually fail. And when that time comes, shit is really going to hit the fan.
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no shit

If you thought that the housing bubble and the dot com bubble was bad..when you realize that your retirement of X has a value of 10% of what you projected...
 
Krugman used to be an economist of some note. Now, he's just a parody of himself.
 
but he's still an advisor to the administration, right?
 
Before its over, Obama's going to run up the debt to over $20 TRILLION.

The Fed has artificially driven down interest rates... They print money and buy TBills with the money. Less TBills drives up the price, which lowers the yield. I don't see how they can keep it up for the long term. Historical rates are closer to 5% than the almost 0% we are paying on the debt now. At 5% of $20T, the interest alone will cost $1T.

To put that in perspective, $1T is roughly what the sum of all personal and corporate income tax receipts last year. Every dollar of taxes would go to paying interest payments on the debt that Krugman and Reich and other left wing economists propose we increase even more.

The government gets income from FICA type taxes as well.

Medicare is running at massive deficits. The prescription drug benefit added by Bush and Republicans make the situation even worse. If we repealed the program, Medicare would still be running massive deficits. The deficits are covered by borrowing $trillions from China and anyone else willing to buy TBills.

Social Security has run a surplus since the 1980s. The surplus funds responsibly invested in the safest investment in the world, you guessed it, TBills. The funds went into the treasury each year and got spent. As more boomers retire, SS was expected to start taking in less than it needs to pay out in 2016. But it's been spending more than it takes in since 2010. The govt. owes itself interest on the TBills owned by the SS trust fund, so the program is "technically" growing, tho not for long. On a cash flow basis, the shortfall was borrowed from China and anyone else who would buy a TBill. That SS tax cut Obama forced on us was effectively a $120B raid on the trust fund; it's going to run out that much sooner than it otherwise would.

Krugman is downright dangerous. At $16T of debt, we would have to TRIPLE everyone's income tax to pay it down to $6T over 10 years. Taxes are about $1T now, including corporate. At 3x, we'd have $1T to cover the red ink govt. insists on, and another $1T to pay down the actual debt.

Tax the rich? They're already paying 43%, including the recent tax hike and the one in ObamaCare. 3x that is more than a 100% tax rate, or not possible.

Elections have consequences. Taking Krugman's advice will hasten our demise.
 
I think we may look back at this administration on what not to do. Well that is of course if we don't have a complete economic collapse. Eventually the administration must increase taxes on all economic fronts because you can't tax the rich any more. I suspect Feds will have 10% increases across the board.

But it won't stop there. The value of the dollar will deplete to a dismal amount, leaving Americans with a dollar worth much less than it was 6 years ago. When the administration is up, it maybe even worse. This revolving debt is spinning out of control. Eventually the snow ball will build enough momentum to be unstoppable.
 
magnifier661 said:
I think we may look back at this administration on what not to do. Well that is of course if we don't have a complete economic collapse. Eventually the administration must increase taxes on all economic fronts because you can't tax the rich any more. I suspect Feds will have 10% increases across the board.

But it won't stop there. The value of the dollar will deplete to a dismal amount, leaving Americans with a dollar worth much less than it was 6 years ago. When the administration is up, it maybe even worse. This revolving debt is spinning out of control. Eventually the snow ball will build enough momentum to be unstoppable.
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Man you sound like Maris! Here I thought the Bush administration was what not to do. I mean Osama Bin Laden basically won. He completely forced us to give up so many civil liberties for "safety" against terrorism. We racked up massive debt for the military, and our country is not safer than it was before 9-11.
 
westnob said:
Man you sound like Maris! Here I thought the Bush administration was what not to do. I mean Osama Bin Laden basically won. He completely forced us to give up so many civil liberties for "safety" against terrorism. We racked up massive debt for the military, and our country is not safer than it was before 9-11.
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And to think. The Obama administration matched 8 years of bush spending in just 4 years. I think we all can agree that bush was a joke. Now that we all agree, we should all agree Obama is much worse, and that's really bad!
 
magnifier661 said:
And to think. The Obama administration matched 8 years of bush spending in just 4 years. I think we all can agree that bush was a joke. Now that we all agree, we should all agree Obama is much worse, and that's really bad!
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I'm sorry but I have to disagree. Bush's spending did not help us. Obama's spending could be debated, but I think it has helped us.
 
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