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| We could even put Reagan's face on it to please Republicans |
I have little to no knowledge
as to how the Treasury of the United
States
At one time our money was
worth face value: a fifty dollar gold piece was actually worth fifty dollars in
precious metal and a one dollar silver certificate was redeemable for one
dollar worth of silver.
Those days have long gone,
and now our money is not backed up by hard collateral, but is worth its face
value only because the government says it is.
Foreign governments and our own population have no idea how much paper
money or how much coin currency is in circulation. Therefore, an increase in the supply would
not change the value of the currency – again it has value only because the
government says it does.
In 1996 a law was passed by
Congress allowing the Treasury to mint commemorative coins ‘in any amount.’ Since 1996 the mint has made a profit of
between six-hundred-million and eight-hundred-million dollars annually minting
commemorative coins, and these profits go to the General Fund.
When the government borrows
money it incurs interest, and when it posts government bonds it must pay
interest. However, the Secretary of the
Treasury has the authority from the Constitution to create money without
debt. In other words printing money is
debt neutral.
Thus the musing of some
people that the government should mint a trillion dollar coin and deposit it in
the general fund to solve the debt crisis.
This has absolutely no chance
of actually happening; however, in true Republican conspiracy fashion a
Republican Congressman is putting together a bill that would forbid the
President from having the Treasury issue a trillion dollar coin.
I am sure that many people
have much grater knowledge of government financing and money printing than I do
– so I stand to be corrected.
But you have got to admit, it
is an intriguing idea.
the Ol’Buzzard
I'm tickled enough by the idea of a trillion dollar platinum coin that I imagine it being something like the size of a Walmart store but coin shaped. People could come and visit it to have their pictures taken.
ReplyDeleteOf all the money in the world only a very small fraction is in cash.