Obama's Trillion Dollar Coin Option

[Matthanuf06]

Originally Posted by orangeblueorangeblue

We are (and have been) talking grand scheme. Incremental inflationary periods have been hurting people forever, long before qualitative easing, long before the Fed.

Incremental inflation? Lol

Look, we want a little bit of inflation. But if you don't think the risk is there for more than that then I have some ocean front property in Arizona to sell you.

How do you think we can pay off this debt without debasing the currency when we are at a pace of doubling it every handful of years?

I understand we don't have to pay the whole thing off.

The growth option is really far fetched because we've exhausted our government expenditures as part of the equation. In fact, it's going to become a drag. Sure, another tech revolution could save us...but to bank on that?

[wargunfan]

When this inflation hits it will make Jimmy Carter look like an economic genius.

[ChartsandGrafs]

Originally Posted by orangeblueorangeblue

I'd trade the Fed for a wholly public central bank any day. It would actually solve a lot of our problems with that move alone.

No, not really. Large private banks and corporations would still control the election process and determine who reaches key political positions through their control of campaign financing and the media. Instead of a private cartel with private shareholders, you would end up with a government agency under the indirect political control of wealthy private interests.

How would that solve anything?

[gator10010]

Originally Posted by orangeblueorangeblue

We are (and have been) talking grand scheme. Incremental inflationary periods have been hurting people forever, long before qualitative easing, long before the Fed.

Incremental inflationary periods? I guess if you trust the CPI numbers.

Question, what do you think would happen if/when foreign central banks start selling all of the US dollars they are sitting on, ultimately sending all of the printed fiat currency back to America?

Would this scenario qualify as an incremental inflationary period?

[chemgator]

Originally Posted by FrolfGator

There's no need to guess why S&P lowered the credit rating, they came out and said it: the fact that the extreme-right Republican House would seriously hold the full faith and credit of the United States hostage as an anti-democratic means to enact their radical agenda. In the past it's always been the House minority party that has (token) voted against raising the debt ceiling. The extremist Tea Party Republicans are the first time this has been threatened by the House majority party.

BALONEY!!! Prove it. You can't, because it didn't happen. They said that it was a contributing factor, not a deciding factor. If you don't understand the difference, this discussion is not for you. They never came out and gave a clear explanation of the cause, with a deciding factor. Inability to balance the budget was also cited as a factor, so why don't you play up that angle?

The bottom line is that the credit rating was lowered under Obama multiple times. The first time in history that this has happened. A lot of what was unsaid is that Obama's unwillingness to negotiate in good faith with republicans is the cause of these "extreme" budget battles. Obama promotes his budget cuts that total 0.02% of the federal budget, in exchange for massive tax increases.

Only a halfwit would believe that there is anything radical about the generic Tea Party agenda (not the specific things that occasionally come out of their mouths--just like Biden's crazy speeches doesn't represent the democrat's viewpoints). They believe in cutting gov't spending. I fail to see how that's radical at all. In fact, it's called austerity, and several countries (like Germany) have implemented it successfully over the long term. And, no, they didn't do it by proposing 0.02% budget cuts and cranking up taxes as the solution.

[orangeblueorangeblue]

Originally Posted by gator10010

Incremental inflationary periods? I guess if you trust the CPI numbers.

Question, what do you think would happen if/when foreign central banks start selling all of the US dollars they are sitting on, ultimately sending all of the printed fiat currency back to America?

Would this scenario qualify as an incremental inflationary period?

It might, except our monetary policy also has methods for mitigating this.

Originally Posted by Matthanuf06

Incremental inflation? Lol

Look, we want a little bit of inflation. But if you don't think the risk is there for more than that then I have some ocean front property in Arizona to sell you.

The risk is there and I never said it wasn't. But it isn't there for $1T of money that doesn't go directly into the economy. That's a pretty simple distinction. What this does instead is impact two primary economic forces: the federal government and the Fed. Very little of this will be turned into currency and injected into the economy.

In other words, if they talked about printing $1T and pushing it into the general economy I would be far more concerned.

How do you think we can pay off this debt without debasing the currency when we are at a pace of doubling it every handful of years?

I'm not sure that's the government's goal, honestly. The last time we weren't in debt was some time in the 1810s, no? You certainly have a lot more leniency in these regards when:

1. You control the money supply
2. Everyone to whom you owe money uses that same currency

As long as those two things are happening, I do not expect the government to really focus much on reducing debt. Deficit? Maybe. Hopefully the pressure will eventually get Washington to make a move in this regard.

Originally Posted by wargunfan

Your "Grand Scheme" will cause millions of Americans to suffer because this government refuses to get its house in order.

As has been the case for centuries. The trillion dollar coin option is the same trick from a different angle.

Please don't refer to it as "my" grand scheme, I'm just giving some macro input on it. I don't agree with it (as I've said several times in this thread already).

[tegator80]

Originally Posted by wargunfan

When this inflation hits it will make Jimmy Carter look like an economic genius.

As I have said before, The Fed isn't playing with fire in keeping the rates artificially low and buying up our debt, they are playing with nitroglycerin. When it goes, it will go off BIG. And there won't be any effective steps to keep it in check.

That is why I call the financial situation our future train wreck. It will be sudden and ugly. But then we can begin to implement austerity measures today and start to wean people off of the free stuff. And then civil disobedience becomes the norm...and it will be ugly. But at least we we are trying to right the ship.

Guess which one will win out in the end? Hint: it won't be the latter.

[chemgator]

It's all a big foolish gamble. The only way that Obamanomics works is if the next "internet revolution" starts here soon, and the economy grows exponentially, driving the GDP high enough to make the current debt levels irrelevant. Yet Obama is doing little to nothing to make this revolution happen. Increasing taxes on Americans will have minimal effect on the deficits--everyone knows that. You either have to dramatically grow the economy, or reduce federal spending. Otherwise, we keep marching towards becoming Greece. A slower march, perhaps, but a certain one. I can't fathom why liberals cannot understand the parallels between excessive gov't spending and economic collapse the way Greece has demonstrated. Equally incomprehensible is the incredibly naive liberal idea that you can increase taxes and income for the federal gov't, and Congress won't increase spending as a result. I guess liberals are naturally gullible.

[g8trjax]

[quote=chemgator;6309540]It's all a big foolish gamble. The only way that Obamanomics works is if the next "internet revolution" starts here soon, and the economy grows exponentially, driving the GDP high enough to make the current debt levels irrelevant. Yet Obama is doing little to nothing to make this revolution happen. Increasing taxes on Americans will have minimal effect on the deficits--everyone knows that. You either have to dramatically grow the economy, or reduce federal spending. Otherwise, we keep marching towards becoming Greece. A slower march, perhaps, but a certain one. I can't fathom why liberals cannot understand the parallels between excessive gov't spending and economic collapse the way Greece has demonstrated. Equally incomprehensible is the incredibly naive liberal idea that you can increase taxes and income for the federal gov't, and Congress won't increase spending as a result. I guess liberals are naturally gullible.[/QUOTE]

If a pub was in power...well, you know.

[madgator]

Originally Posted by Matthanuf06

Minting the coin would end America as we know it.

what america exists today that would be destroyed?


we're already LOOONG gone

[gator996]

madgator...

[llm85]

Our government can't even keep track of $100 Medicaid payments. How are they going to keep track of a One Trillion Dollar coin? At some point this coin would come up missing, unless we put it on public display 24/7.

I can just imagine lines of people in the future walking by this little coin and saying "so, that's what we're paying all this debt-interest for."

[orangeblueorangeblue]

Well if it makes you feel any better, it'd be held at the Federal Reserve.

[llm85]

Originally Posted by orangeblueorangeblue

Well if it makes you feel any better, it'd be held at the Federal Reserve.

Oh, I feeeeeeeeeeel so much better.

[MichiGator2002]

Originally Posted by orangeblueorangeblue

Well if it makes you feel any better, it'd be held at the Federal Reserve.

Why bother? Who would steal it other than as novelty? The only thing I think that people understand implicitly about the theorized coin is that it wouldn't, would not, actually be worth a trillion dollars.