It has been proposed that the Treasury mint and issue a trillion dollar coin.
Why? Is it the stupidest thing you’ve ever heard? I mean, really…I can’t get most vending machines to take a perfect dollar bill without barfing it back at me, and the Government wants to mint a trillion dollar coin?
Seriously, it’s being laughed at in Washington, but believe me, the whole story is a trial balloon, to see how the idea goes over, and I think it will be embraced, because it seems so simple. Here’s how it would work:
The mint stamps out a coin worth a trillion dollars. Maybe two. Or a hundred. Whatever. They deposit the coin in the bank, and say “hey, we’ve got money to pay our bills!”
Really though, how is that different than running the printing presses night and day to print up money, which because we have a fiat currency, they can do anyway? This is much cheaper.
There’s also the possibility that the government, after minting the big coin, will say to China “hey, Chinaman, call in all your Treasury Bills you hold (basically IOUs we print to get them to loan us money) and we’ll be happy to pay them off, with this shiny, new platinum $1 Trillion Dollar coin. There you go, Wo-Fat. Piss off.
Economically, we’re past the point of no return, and to be honest, I’m not sure it’s the dumbest idea in the world. It won’t do anything more than kick the can down the road a couple months, but hey…