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View Diary: OK, *NOW* the Platinum Coin Won't Work, Thanks to Idiots, Cowards, or Knaves (99 comments)

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  •  Wow (1+ / 0-)
    Recommended by:
    Calgacus

    That "belief in its validity" -- that's something other than "out of thin air"?

    I look forward to your explaining how you think that credit default swaps haven't had the effect you suggest.  Criminey.

    Plaintiffs' Employment Law Attorney (harassment, discrimination, retaliation, whistleblowing, wage & hour, &c.) in North Orange County, CA.

    "I love this goddamn country, and we're going to take it back."
    -- Saul Alinsky

    by Seneca Doane on Mon Jan 14, 2013 at 10:44:59 AM PST

    [ Parent ]

    •  No it isn;t out of thin air (0+ / 0-)

      when the currency is backed by the full faith and credit. Simply making up a coin does not give anyone faith.

      I have no desire to defend a financial mechanism (credit default swaps) that i disagree with. But that is no germane to the issues we are discussing. Which is an alternative to raising the debt ceiling by use of a mythical coin.

      Curious, what do YOU think the US currency value is based upon? Gold? :-)

      •  Bonds are coins, and vice versa (0+ / 0-)

        Simply making up a coin does not give anyone faith.

        But simply making up a bond, which is just another coin, does?  

        All money everywhere, always, has been created ONLY by "magic" "making it up" out of "thin air".

        Curious, what do YOU think the US currency value is based upon?

        Not Seneca but - US currency value is based on two things: (a) the demand for currency - taxation or the prices that the US government demands for stuff you buy from it  &
        (b) Spending - what you have to do for the government to get currency from it, e.g. by selling real goods & services or your labor to it.

        Every other explanation is pure BS.

        The full faith and credit that is important to investors is that the US will be a gigantic operation that has and will demand a gigantic amount of taxes and other payments from the non-government sector, and that it will not spend to excess, causing inflation - which has not happened in nearly 70 years. This is a very good, very rational expectation.

        Thinking it matters whether the spending involves coins or bonds is beyond silly. It is like thinking a catastrophe would occur when they issued the Susan B. Anthony dollar.

        •  You are mostly (0+ / 0-)

          incorrect.

          "All money everywhere, always, has been created ONLY by "magic" "making it up" out of "thin air""
          is  silliness.

          Now this:

          "The full faith and credit that is important to investors is that the US will be a gigantic operation that has and will demand a gigantic amount of taxes and other payments from the non-government sector, and that it will not spend to excess, causing inflation - which has not happened in nearly 70 years. This is a very good, very rational expectation."
          Is exactly what I said.

          bonds are not thin air. They are promissory notes that promise repayment with some conditions of interest and use etc.

          Now I'll agree with the Treasury Department and the PResident on this. You can believe in cartoon fiscal policy.  

          •  No, I am not. (1+ / 0-)
            Recommended by:
            Seneca Doane
            "All money everywhere, always, has been created ONLY by "magic" "making it up" out of "thin air""
            is  silliness.

            No, it is the simple truth. Everybody used to (vaguely) know it. Money is credit/debt. A relationship, a promise, a trust. It can ONLY be created out of "thin air", by the promissor/debtor.

            Is exactly what I said.

            No, it is not. You did not use the magic words "taxes and other payments from the non-government sector" or equivalents. You have been deceived by people who say things which sound right, because they are near the correct phrases and words. But they are not. I speak very precisely.

            To quote FDR, "government credit and government currency are one and the same thing".  I don't think you understand this, unfortunately.  

            A government bond is "one and the same thing" as a government coin. Distinguishing between them the way you do, thinking that the bond is mystically more trustworthy than the coin - has no logical or empirical basis whatsoever.

            •  This Mister guy is very very convinced (0+ / 0-)

              of things that are not true.  That makes it hard to argue with him.

              Plaintiffs' Employment Law Attorney (harassment, discrimination, retaliation, whistleblowing, wage & hour, &c.) in North Orange County, CA.

              "I love this goddamn country, and we're going to take it back."
              -- Saul Alinsky

              by Seneca Doane on Tue Jan 15, 2013 at 02:51:17 PM PST

              [ Parent ]

    •  Hey why not mint 16 of them (0+ / 0-)

      and wipe out the debt entirely?

      •  That would not wipe out the debt (1+ / 0-)
        Recommended by:
        Seneca Doane

        That might wipe out "the debt subject to the limit" - an artificial and arbitrary ceremonial construction.

        But it would not "wipe out the debt". It would merely transform it from one debt instrument - bonds, to (an)other - coins, cash, reserves, currency. The National Debt, properly speaking, which is usually not expressed and calculated correctly, as e.g. Wray has complained, would not change.

        Coins are every bit as much "debt" as bonds, because they have the same power to cancel a debt going the other way, e.g. (future) tax payments.

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