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Barefootsies

01-04-2013 12:37 PM

When the two months expire, Treasury will no longer be able to pay the country's bills

Quote:

Last week, Treasury Secretary Tim Geithner made it official: Federal borrowing has reached the $16.394 trillion debt ceiling.

Treasury, which runs the government's debt-issuance operation, is busy creating about $200 billion of headroom by employing what it calls "extraordinary measures." That should cover about two months' worth of borrowing.

When the two months expire, Treasury will no longer be able to pay the country's bills -- that is, it won't be able to borrow more money to pay for spending already authorized by Congress.

If Congress does not act to raise the debt ceiling, the U.S. will default on its debts. Not good. But this is where the platinum coin comes in. Normally, the Federal Reserve is charged with issuing currency. But U.S. law, specifically 31 USC § 5112, also grants Treasury permission to "mint and issue platinum bullion coins and proof platinum coins."

FULL STORY

MaDalton

01-04-2013 12:39 PM

http://cdn1.spiegel.de/images/image-...eryV9-eubm.jpg

PornoMonster

01-04-2013 12:57 PM

Borrow to Pay Hummm

DWB	01-04-2013 05:01 PM

Don't worry about that, you need to be debating GUNS!!!!!

Bill8

01-04-2013 05:16 PM

I thought it was interesting, and funny, that krugman mentioned coin seigniorage in a recent editorial.

And time just did an article on it.

first highlighted in the Summer of 2011 by Yale Constitutional Law Professor Jack M. Balkin, is for the Treasury to use a loophole in the law meant to enable it to issue commemorative coins in order to issue two $1 trillion platinum coins, and then deposit them with the Federal Reserve. The Fed could then deposit funds with the Treasury in return.

Read more: http://business.time.com/2013/01/04/...#ixzz2H3VtGOJ2

fitzmulti

01-04-2013 05:16 PM

Maybe they can get a loan from MANWIN?

Bill8

01-04-2013 05:23 PM

It really is a shame they blocked sequestration - but, you knew the republicans had to pussy out, it was always an empty threat.

one thing you can count on - the republicans will always pussy out. and the dems will always be happy to "compromise".

Think what a different world we would be in today if sequestration hadn't been pussied. That would have been some show.

If the tea party threatens the debt ceiling again, the republicans will just pussy out again. This is all theatre, to give that uncle tom obama a pretext to 'compromise'.

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