If the USA can't raise the debt ceiling in time what will happen to the price?

Viking

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Quote from: Andris on July 31, 2011, 03:53:18 PM

Quote from: westkybitcoins on July 31, 2011, 03:15:25 PM

Only because the debt would have, legally, been paid.

Of course, those receiving the trillion-dollar platinum coins would probably be a little upset.

Or they might just deposit them, flooding the USD market, and life would go on, albeit with a new surge of inflation.

Only two coins would be minted, and they'd largely be symbolic - i.e. you can't steal them. It's only inflationary if the currency they pay for enters common repeated circulation, which simply isn't happening at this point.

As much as I think the Fed system is a screwup, this is false. The money are already in the economy, they entered when they was borrowed.

mpfrank

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Quote from: westkybitcoins on July 31, 2011, 03:15:25 PM

Quote from: iamzill on July 31, 2011, 03:05:41 PM

Quote from: mpfrank on July 31, 2011, 12:19:23 PM

Also, Title 31, sec. 5112, paragraph (k) of the U.S. code explicitly authorizes the Treasury department to issue as much money in the form of platinum coins as it wishes, at its discretion. So, in a pinch, Geithner could always just stamp out a few platinum coins marked "ONE TRILLION DOLLARS" each, and make the debt problem go away.

(Source: http://www.law.cornell.edu/uscode/31/5112.html; some discussion at http://www.alternet.org/news/151718/there%27s_a_solution_to_the_debt_fight_that_could_avert_catastrophe_--_why_is_everyone_ignoring_it/)

How is that not a default?

Only because the debt would have, legally, been paid.

Of course, those receiving the trillion-dollar platinum coins would probably be a little upset.

Or they might just deposit them, flooding the USD market, and life would go on, albeit with a new surge of inflation.

Yes... I assumed that if this happened, they'd have been deposited in the U.S. Treasury's account at the Fed...

Andris

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Quote from: westkybitcoins on July 31, 2011, 03:15:25 PM

Only because the debt would have, legally, been paid.

Of course, those receiving the trillion-dollar platinum coins would probably be a little upset.

Or they might just deposit them, flooding the USD market, and life would go on, albeit with a new surge of inflation.

Only two coins would be minted, and they'd largely be symbolic - i.e. you can't steal them. It's only inflationary if the currency they pay for enters common repeated circulation, which simply isn't happening at this point.

westkybitcoins

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Quote from: iamzill on July 31, 2011, 03:05:41 PM

Quote from: mpfrank on July 31, 2011, 12:19:23 PM

Also, Title 31, sec. 5112, paragraph (k) of the U.S. code explicitly authorizes the Treasury department to issue as much money in the form of platinum coins as it wishes, at its discretion. So, in a pinch, Geithner could always just stamp out a few platinum coins marked "ONE TRILLION DOLLARS" each, and make the debt problem go away.

(Source: http://www.law.cornell.edu/uscode/31/5112.html; some discussion at http://www.alternet.org/news/151718/there%27s_a_solution_to_the_debt_fight_that_could_avert_catastrophe_--_why_is_everyone_ignoring_it/)

How is that not a default?

Only because the debt would have, legally, been paid.

Of course, those receiving the trillion-dollar platinum coins would probably be a little upset.

Or they might just deposit them, flooding the USD market, and life would go on, albeit with a new surge of inflation.

iamzill

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Quote from: mpfrank on July 31, 2011, 12:19:23 PM

Also, Title 31, sec. 5112, paragraph (k) of the U.S. code explicitly authorizes the Treasury department to issue as much money in the form of platinum coins as it wishes, at its discretion. So, in a pinch, Geithner could always just stamp out a few platinum coins marked "ONE TRILLION DOLLARS" each, and make the debt problem go away.

(Source: http://www.law.cornell.edu/uscode/31/5112.html; some discussion at http://www.alternet.org/news/151718/there%27s_a_solution_to_the_debt_fight_that_could_avert_catastrophe_--_why_is_everyone_ignoring_it/)

How is that not a default?

evoorhees

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Quote from: mpfrank on July 31, 2011, 12:19:23 PM

Also, Title 31, sec. 5112, paragraph (k) of the U.S. code explicitly authorizes the Treasury department to issue as much money in the form of platinum coins as it wishes, at its discretion. So, in a pinch, Geithner could always just stamp out a few platinum coins marked "ONE TRILLION DOLLARS" each, and make the debt problem go away.

Lol it's funny cause it's true.

mpfrank

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Cosmic Cubist

Also, Title 31, sec. 5112, paragraph (k) of the U.S. code explicitly authorizes the Treasury department to issue as much money in the form of platinum coins as it wishes, at its discretion. So, in a pinch, Geithner could always just stamp out a few platinum coins marked "ONE TRILLION DOLLARS" each, and make the debt problem go away.

(Source: http://www.law.cornell.edu/uscode/31/5112.html; some discussion at http://www.alternet.org/news/151718/there%27s_a_solution_to_the_debt_fight_that_could_avert_catastrophe_--_why_is_everyone_ignoring_it/)

Andris

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Not much.

The 14th amendment does specify that debts must be paid. This means Social Security and debt servicing such as interest. Word is bond-holders have already been made aware by the Obama administration to pursue this route if necessary.

Sucks for potentially everything else in the US budget, sure, which won't be good for the economy. But the government is still good for its debt.

TiagoTiago

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What do you expect will happen to the price of BTC if the USA can't raise the debt ceiling in time?

Topic: If the USA can't raise the debt ceiling in time what will happen to the price? (Read 1371 times)