Monthly Archives: January 2013

The Most Embarrassing Financial Column of 2013

Posted on January 14, 2013 by Devin Smith | 29 comments

We are only two weeks in to 2013 and there is plenty of time for far more embarrassing financial columns to be written, but The Guardian’s financial editor, Heidi Moore, has opened up an early lead in the competition. Moore’s column represents five embarrassing elements. She entitled her piece: “’Mint the coin’: why the platinum coin campaign doesn’t even work as satire.”

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29 Comments

Posted in William K. Black

Tagged #MintTheCoin, MMT, Modern Monetary Theory, neo-liberal doctrine

The Coin Abides

Posted on January 13, 2013 by Dan Kervick | 46 comments

By Dan Kervick

Matt Yglesias has posted a sharp post-mortem on the platinum coin debate. This weekend, the White House imperiously declared that debate over. And perhaps it is – for now. But Yglesias remarks on the salubrious effects of the debate:

All that said, I’m glad we had this conversation. Direct discussion of the platinum coin was a good reminder that many people, including influential media figures, appear to have no idea what money is or how the monetary system works. Apart from the shockingly widespread view that the value of coins is determined by their metallic content, there was a lot of insistence that creating money was somehow an act of “magic.” In fact, the way all legal currency is created is that a government agency creates the money.

I would go a bit further. The coin debate triggered something. The platinum coin is a big shiny, reminder that in some way, somehow, the monetary authority of the United States rests with the American people, even if the plutocratic architects of our financial system and the owners of our country have succeeded over time in burying that authority under many layers of convoluted technocracy and confusing delegations.

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Posted in Dan Kervick, Uncategorized

The Bright Shiny Object of Change

Posted on January 13, 2013 by Devin Smith | 28 comments

By Joel David Palmer

Did you feel it? The earth moved under our feet a little bit over the past week. I’m feeling quite grateful to beowolf and Joe Firestone and everyone else who laid the foundation for Mint The Coin, and to Stephanie Kelton (for creating) and Joe Weisenthal (for popularizing) the #MintTheCoin hashtag and circulating the White House petition.

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28 Comments

Posted in Joel David Palmer

Tagged #MintTheCoin, #TDC, Trillion Dollar Coin

Public Debt, Debt Ceiling and Monetary Sovereignty: Some Accounting Realities

Posted on January 12, 2013 by Devin Smith | 45 comments

By Eric Tymoigne

The public debt is the outstanding U.S. Treasury securities (USTS). It includes both marketable (T-bills, T-notes, T-bonds, TIPSs, and a few others) and non-marketable securities (United States notes, Gold certificates, U.S. savings bonds, Treasury demand deposits issued to States and Local Gov., all sorts of government account series securities held by Deposit Funds). What are the means to reduce the public debt? Continue reading →

45 Comments

Posted in Eric Tymoigne

Tagged debt ceiling, MMT, Modern Monetary Theory, monetary sovereignty, public debt

The Quadrillion Dollar Thought Experiment

Posted on January 11, 2013 by Dan Kervick | 59 comments

By Dan Kervick

Imagine this: In a burst of manic, public-spirited zeal and budgetary enthusiasm, the US Congress passes, and the President signs, the following law. (Lawyers, forgive my poor mastery of legalese and feel free to translate the sense of what follows into the appropriate terminology):

L.1 The Secretary of the Treasury shall by a date no later than September 30, 2013 consolidate all United States Treasury accounts into a single account, to be called the “General Account”, and to be held at the Federal Reserve Bank of New York.

L.2 The General Account shall be used to settle and record all payments to and from the US Treasury.

L.3 The Federal Reserve Bank of New York shall on midnight, October 1, 2013 credit the General Account with an initial balance of $1,000,000,000,000,000.00

That’s one quadrillion dollars, about 263 times the current US annual budget, and about 63 times the current US Gross Domestic Product.

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59 Comments

Posted in Dan Kervick, MMT

Ezra Klein Chooses Fear Mongering the Big Coin, I Choose Ending Austerity!

Posted on January 11, 2013 by Devin Smith | 29 comments

By Joe Firestone
(H/t to Lambert Strether for the title!)

Here’s a commentary on Ezra Klein’s recent diatribe against Platinum Coin Seigniorage (PCS).

But there’s nothing benign about the platinum coin. It is a breakdown in the American system of governance, a symbol that we have become a banana republic. And perhaps we have. But the platinum coin is not the first cousin of cleanly raising the debt ceiling. It is the first cousin of defaulting on our debts. As with true default, it proves to the financial markets that we can no longer be trusted to manage our economic affairs predictably and rationally. It’s evidence that American politics has transitioned from dysfunctional to broken and that all manner of once-ludicrous outcomes have muscled their way into the realm of possibility. As with default, it will mean our borrowing costs rise and financial markets gradually lose trust in our system, though perhaps not with the disruptive panic that default would bring.

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29 Comments

Posted in Joe Firestone

Tagged #PCS, #TDC, $60 T coin, austerity, beowulf, debt ceiling, debt-subject-to-the-limit, Ezra Klein, Fiscal Policy, game-changing PCS, MMT, Modern Monetary Theory, Philip Diehl, platinum coin seigniorage, small ball PCS, Trillion Dollar Coin

Krugman and Obama’s Dangerous Austerity Myths

Posted on January 11, 2013 by Devin Smith | 18 comments

By William K. Black

Austerity in response to the Great Recession has proven to be an economic weapon of mass destruction. On January 10, 2013, Paul Krugman (Nobel Laureate in Economics) and President Obama launched the same dangerous austerity myth in remarkably similar language.

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