Forget The $1 Trillion Platinum Coin–Here’s the $10 Trillion Stone Coin
The point I’m making with the $10 trillion stone coin is that if money is a social contrivance, then it should be distributed to those creating goods and services.
You’ve probably heard of the $1 trillion platinum coin proposal: the basic idea is the U.S. Mint issues a $1 trillion platinum coin, and returns the difference between the cost of minting the coin (trivial) and the face value attributed to the coin ($1 trillion) to the United States Treasury General Fund.
This difference is known asseigniorage. The federal government could then spend the $1 trillion without having to borrow the money by selling Treasury bonds–the usual mechanism for funding federal deficit spending.
The idea was originally proposed as a way of avoiding more federal borrowing: rather than borrow another $1 trillion to fund federal spending, the Treasury would be handed $1 trillion in freshly created cash as seigniorage proceeds from the $1 trillion coin.
Is the idea legal? Some scholars say yes, others are doubtful.
The point of the $1 trillion platinum coin is to create money out of nothing and do so outside the Federal Reserve, which creates money out of nothing but balances that debit by buying Treasury bonds, which are booked as an asset.
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