$15 Trillion in 5 Days

Many posts above have proved that the FRN is not the only form of dollar. It is the only currency at the present time [excluding coinage which is not issued by the Fed but still are dollars], and I'm sure you know by now that you are wrong, but can't admit it. By your definition, China and other nations have no dollar reserves. By your definition, the Eurodollar doesn't exist. By your definition, Treasury money market funds are not dollars. By your definition, wire transfers do not take place in dollars. By your definition, when we finally move to a cashless society [if it happens], there will be no dollars. All of this is a complete absurdity, but it's a free country and you can believe what you want. Good luck with that strategy.

 

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Well, you're wrong about coins. Do you research anything, or just make it up to support your arguments?

http://www.newyorkfed.org/aboutthefed/fedpoint/fed01.html

 

You are being delusional. I did not say any of this. You don't understand the context of this conversation. Read it again, and when you post something sensible, I'll respond.

We are talking about USD. Not Euros, not monopoly money, not dollars used by martians.

 

I stand corrected. (I admit my mistakes which you said I don't do.) The Fed pays face value for the coins. However just like printed currency, they do not obtain monetary value until the Fed releases them into circulation.

 

Feel free not to respond. Your inability to distinguish between the US currency and US dollar is something I would not expect from a CoinTalk participant.

 

If you read more carefully, you will see that the coinage can also get into circulation through the Direct Mint Shipment program that bypasses the Fed entirely. So that comment of yours is incorrect also.

 

You said:

i.e. You contend there are many forms of $s, not just the Federal Reserve Dollar.

Then you amazingly posted this, with your coin distraction,

And it clearly states this:

"Virtually all of currency notes in use are Federal Reserve notes. "​

My point is proven with you own link. The only USD in circulation are Federal Reserve Dollars.

 

No it doesn't. You have to pay for those coins with Federal Reserve Notes. LOL!

 

I completely agree that the only form of paper currency note in use is the FRN and I've said so several times. But FRNs are not the only form of the US dollar -- a big difference.

 

Banks do not ship pallets of FRNs to the US Treasury to buy coins. The payment is electronic - another form of USD not contemplated in your understanding of money, and not paper currency.

Do you really not understand that there is a difference between the dollar and Federal Reserve Note, or are you just playing around?

 

You Said:

Yes indeed I replied, to be paid for with FRNs. Then you amazingly said in response:

i.e. You claim that Banks are using the US Mint's Direct Ship Program to stock coins. Really? Do you actually think the US banking system gets coins through their Direct Ship Program? Hahahahahaha.

Son, I begin to believe that you don't even collect coins. The US Banking system doesn't use the Direct Ship program to purchase coins. Almost all the real coin collectors on this site can tell you that. The Direct Ship program is aimed at consumers only. All Federal Reserve Banks order their coins from the Federal Reserve. As proof I present this from the very link that you supplied above. I suppose you didn't even bother to read it.

"The U.S. Mint produces coins in Philadelphia, Denver, and San Francisco, and ships them to the Federal Reserve Banks and to authorized armored carriers, which supply banks that need coins to meet the public's demand. "​

 

From the same source I quoted earlier [NY Fed]...

"large banks in some Federal Reserve Districts participate in a Direct Mint Shipment Program, and receive coins directly from the Mint."

This is tiresome. I hope everyone will read and decide for themselves. Fatima, you're hopeless, and I hope that not too many people are hurt by your posts.

 

Oh my. LOL This was intended to get people to use the $ coin. Banks are not going to pay $12.50 to order $250 worth of coins for their own operations. Your insults directed towards me are irrelevant.

Furthermore the entire distraction about coins that you brought into this has nothing to do with what was being discussed. What was being discussed was the contention that Treasury Notes constitute the largest supply of dollars out there and because of this, the Federal Reserve Note, $, isn't the major supply of dollars. Clearly this was wrong.

 

I think the lack of concise definitions is what is causing the confusion here. Treasuries far exceed dollars as far as total debt goes, but they are not dollars. They are debt, and thus they impact the fiscal situation in much the same manner as dollars do since money is also debt. While Treasuries do not require dollars to be created for purpose of the purchase, this is status quo and the two actions are often lumped together, and Treasury sales require dollars being spent whether that comes from new money creation by the Fed or by foreign buyers converting their currency into dollars for said purchase. Dollars can be paper or digital, and they are all notes of the Federal Reserve, but only paper notes have the 'Federal Reserve Note' distinction even though digital notes are exactly the same minus the tangible paper. I propose we start calling the digital notes Federal Reserve Digital Notes (FRDNs) since the term 'dollar' is ambiguous.

 

Let me put it this way Inflexion. What would you call a US treasury financial instrument that pays no interest? A US Note? US Notes are still legal tender in this country. What if the treasury ran out of deep pocket investors and started selling US treasuries for $5 face value? What if people started to exchange them for items? This is how US currency started, the first notes were IINTEREST BEARING DEBT. Remember, ALL US CURRENCY IS DEBT, its just a matter of whether it pays interest or not. All US notes outstanding are still listed as liabilities to the US government, as are all FRN's liabilities to the Fed Reserve.

Scale this idea up and you have countries trading billions of dollars of US Treasuries every day. All of these treasuries are identical to the currency in your wallet except they pay interest.

Inflexion. I hope you grasp this point. If not, I believe higher level financial discussions will be harder for you than need be. I would have simply PM'ed this to you sir but I thought others may be similarly confused.

Chris

P.S. Want further proof? They are called Federeal Reserve NOTES, "this NOTE is legal tender for all debts public and private.". A note legally is debt, its short for promissory note. Even FRN state on their face and in their name they are debt instruments, we are the silly ones accepting debt instruments every day without demanding interest. Its the FRN that are the oddball out, all other treasury debt pays interest.

 

US Treasuries, like Savings Bonds, are issued to a specific person or entity. The owner must show identification when cashing them in to ensure a paper trail for the purpose of tax collection. Therefore, US interest bearing debt instruments are not trade-able (like currency), as the person accepting them in trade would have no way to cash them in.

 

Yes indeed. And when they are redeemed, the US Treasury will pay it off with a check drawn against the Federal Reserve system. The party will have to deposit the check at a Federal Reserve bank to receive payment that can be converted to currency. You will be paid in Federal Reserve Notes.

 

You guys are getting worked up over few trillions once they start rolling off the presses' we will be saved.

(From financial jesus)

 

That is simply not true sir. I know this since every day billions of these bonds change hands on the secondary market. They are registered as to ownership, but that can take a few days for the paperwork to go through, but its simply untrue they are only "issued" to one entity for the life of the bond. In that way they are completely unlike Savings bonds. This registration is simply for security so that thieves aren't tempted to rob a bond storage facility for billions of dollars.

However, why would you register a $5 bond? Answer is you wouldn't. If the US issued $5 bonds it would not be registered, and I believe they exchange similar to FRN's if they made them.

 

But the fact they are traded in the secondary market isn't a proof of these are US dollars. Billions of dollars of oil are traded each day and they are not considered dollars.