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View Diary: Krugman sez Mint That Coin (298 comments)

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  •  there's a long standing (0+ / 0-)

    legal canon against interpreting statutes to lead to absurd conclusions, even if the text can be interpreted to support it.  I don't think the view that the coin could be minted has no support, but the countervailing ones have textual support, too, and support from broader separations of powers principles.  It's not judicial activism to align with the intent of congress, but rather the opposite.  I think there's an implied limitation in the term "denomination," such that congress never conceived of this being applied to anything other than that which could be collected -- raising another statutory objection, that the coin has to be a circulating coin.  You're free not to agree with my reading of it, knowing as I do the background against which any law is written, but that's not the same thing as not addressing the statute.  Seeing it as less complex nevertheless requires argument, which you've made but not particularly well.  

    the other points -- there's a difference between arguments about bond vigilantes objecting to current deficit policy, and bond holders objecting to being paid with money explicitly created to pay them.  It takes away the fed's control over the money supply, and sets a horrible precedent as our politics get more dysfunctional.  

    The notion of monetizing debt has historically been used to stiff foreign creditors, and is also bad for people with fixed incomes.  I think it's a weak legal argument to suggest that this alone calls into question validity of payment or alters bond covenants, but not good practice to pay creditors of equal seniority differently.  This goes back to the question of whether legal interpretation is the same as pure comprehension.  Not really -- more at issue.  It's more like reading the Old Testament.  Again, there's a difference with an ordinary fluctuation in dollar value, the risks of which any holder assumes, and extraordinary measures to make payments.  

    When you bring in general complains about the fed, it sounds like the complaint is less with the debt ceiling negotiations but rather a policy view about what the money supply should look like, which should be argued explicitly and upfront.  Note that even most supporters of this idea think it's ridiculous; I've at least tried to show why.  

    It'll never happen, so i'm bored with this.  It's mostly a setup to gripe against whatever deal Obama and Congress get, after the fact.  Where would we be without absurd counterfactuals?

    Difficult, difficult, lemon difficult.

    by Loge on Wed Jan 09, 2013 at 06:07:33 AM PST

    [ Parent ]

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