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So far we've always had the backup plan of just minting a billion dollar coin. Once that option is taken away at some point this whole thing becomes a lot more
by wongarsu 3y ago
So far we've always had the backup plan of just minting a billion dollar coin. Once that option is taken away at some point this whole thing becomes a lot more serious, and I would expect an accelerated move away from US government bonds and the USD (from people outside the US). Of course actually minting that coin might also damage trust in the USD.
- contravariant 3y agoThis was never about the U.S. not having enough money, with the USD as the currency for oil it's never going to be too hard for the U.S. to get enough USD together one way or another. The problem is the U.S. simply being unwilling to pay interest. Which you cannot solve by printing more money.
- Guthur 3y agoIt essentially has infinite dollars, it just hasn't told you about them yet.
- wongarsu 3y agoIt's about the US playing silly political games on a regular schedule. Which you can solve by minting coins, because minting coins generates income without needing approval from congress. https://en.wikipedia.org/wiki/Trillion-dollar_coin https://en.wikipedia.org/wiki/Trillion-dollar_coin
- contravariant 3y agoWait so congress can stop lending but not minting new coins? That's just weird. Although the whole concept of a hard debt limit is weird, not saying you can't limit the amount of debt but you can't just back out of existing obligations.
- wongarsu 3y agoThe minting thing was meant for commemorative coins, which was probably though not important enough to bother congress with. But the law doesn't set a limit on the value of those coins, creating the loophole of creating ridiculously valuable commemorative coins.
- 1over137 3y ago>...backup plan of just minting a billion dollar coin That'd get you nowhere. You mean trillion. A crazy amount of money.
- wongarsu 3y agoYou're right, I was thinking in long-scale numbers.