The 5 Trillion Dollar Coin

[cestlefun17]

Yeah inflation might not be so bad now, but is there any proof that just poofing 5 trillion dollars into existence wouldn't significantly affect inflation?

[scotsgit]

Jul 30, 2011 20:38:59 GMT -5 Radiation said:

Jul 30, 2011 17:33:25 GMT -5 scotsgit said:

Would it work in slot machines? Just wondering. ;D

But then what if you don't win? You won't get that coin back!

Bummer!

What about chocolate machines?

[booley]

Jul 30, 2011 13:47:30 GMT -5 discoberry said:

Finally a debt-crisis solution that makes sense.

One option is coin seigniorage—aka, the "really-huge-coin workaround." The United States has a statutory limit on the amount of paper money in circulation, but no such limit on coins. The Treasury secretary has the authority to mint certain coins of any denomination, with no need for the value of the metal to equal the value of the coin. (It gets a bit technical.) But the idea is that Secretary Timothy Geithner could order the Mint to make a, say, $5 trillion coin. It could then use the coin to buy back and extinguish debt from the Fed, pushing the country back under the ceiling. Or it could deposit it, and the Fed could counteract the inflation by selling government debt.

www.slate.com/?reload=true

Things like this make me think Economics may not be a real science.