I know this idea was scoffed at in another thread (I couldn't find it so I decided to post this one), but the idea simply won't die. How much of it is political buffoonery versus how much is "considered" thought the outcome might be disastrous. The following is a blog post by Paul Krugman the respected (in SOME circles) economist:http://krugman.blogs.nytimes.com/2013/01/08/rage-against-the-coin/ I tend to think it's political buffoonery but, hey, what do I know. Edit: Another link with more references to other posts about it: http://newsbusters.org/blogs/julia-seymour/2013/01/10/left-swoons-loony-magic-coin-plan
The coin idea has considerable merit, but angers the folks who support the Fed and central banking in general. Bloomberg TV won't allow guests who are in favor of the idea, for example. However, the idea would only work to replace bonds held by government or quasi-government organizations because there is no market disruption. I don't know who first floated the idea but I heard it said that the proposal was first made 14 years ago. But since it will be villified by the Fed and Wall Streeters, it probably won't happen. It flies in the face of the idea that the government can't or shouldn't create their own money, and the only way to do it is to borrow the money into existence. This idea is popular because it results in a permanent and rising income stream for banks and other institutional investors.
