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Will Obama #MintTheCoin?

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There is a loophole that allows the Treasury to mint the platinum coin of any value. 1 Trillion platinum coin coming up to get around the Congress?


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good luck trying to get change.

That's the point. It'd be like Mark Twain's short story about the bum with the Million Pound Banknote.

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A trillion dollar coin, seriously? This may be one of the dumbest things I have ever heard.

What a joke, this country is in debt to itself thanks to social security, welfare, and elderly benefits.

What the hell good is a coin going to do to pay off thy debt?

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The coin owes its widely-discussed, though still hypothetical existence to the looming deadline over the debt ceiling - which, as things stand, will prevent the US government issuing new bonds and paying bills, in about two months.

Republicans, who control the US House of Representatives, have pledged to seek spending cuts before consenting to any increase in this limit.

But opponents fear this brinksmanship could threaten the US's credit rating if the country's debt reaches or breaks through this ceiling.

These mostly centre-left critics, including Democratic Congressman Jerrold Nadler, have pointed to a loophole in US law that allows the Treasury Secretary to allocate any value he or she likes to a coin.

They say the Treasury could order the coin to be minted and then deposit it at the Federal Reserve, the US's central bank.

Effectively, the coin is an accounting trick, says Cullen Roche, who blogs about finance and economics at Pragmatic Capitalism.

Its real purpose, however, would be political - to neutralise the threat by Republicans in Congress that federal employees would not be paid, he adds.

"It's a loophole to replace something that's totally insane with something that's slightly less insane," he says.

The campaign has been taken seriously by such eminent people as Nobel prize-winning economist and New York Times columnist Paul Krugman, and Philip Diehl, the former director of the United States Mint. It has also inspired the Twitter hashtag, #MintTheCoin.

But it has attracted opposition, too. Republican Congressman Greg Walden has promised to introduce a bill to ban the government from creating high-value coins to pay its debts.

Walden said he feared the practice would be "very inflationary".

Wray disagrees. "These trillion-dollar coins are held only by the Fed," he says. "There's no increase in the money supply out there."

Supporters of the scheme also say the Federal Reserve could sell bonds, which would withdraw money from circulation.

As yet, however, no such coins exist anywhere. And even those who believe the plan is perfectly feasible concede that it is likely to remain a bargaining chip in the debt-ceiling talks, rather than becoming a reality.

"I think the president will be reluctant to do it because it undermines everyone's credibility," says Roche.

Coin collectors might be advised not to hold their breath about this new denomination turning up on eBay any time soon.

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