Share this page!

Joe Weisenthal Profile picture
Twitter logo
5 Oct, 5 tweets, 3 min read
HOW MINTING A TRILLION DOLLAR COIN FITS IN WITH THE 'TRUE SPIRIT' OF THE LAW

New post up on the Odd Lots blog, based on our conversation with @rohangrey on how the platinum coin option arguably fits in very nicely with the laws intent.

bloomberg.com/news/articles/…
@rohangrey Basically, if you understand that the law was created in order to create more revenue opportunities for the Mint, so it could remit more profits for the Treasury, so that the Treasury would have less need for borrowing, then this debt ceiling law is exactly how it was intended.
@rohangrey Here it is in @rohangrey's words bloomberg.com/news/articles/…
@rohangrey As Rohan admits, the trillion dollar coin option is a lot "more zeroes" than what either Diehl or Castle ever envisioned

But does this fundamentally change things? IMO no, since the coin still doesn't deprive Congress of its spending authority.
All it does is change Treasury's funding mix from debt to seigniorage to a larger degree than expected.

But again, that's a matter of degree, not kind.

• • •

Missing some Tweet in this thread? You can try to force a refresh
　

Keep Current with Joe Weisenthal

Joe Weisenthal Profile picture

Stay in touch and get notified when new unrolls are available from this author!

Read all threads

This Thread may be Removed Anytime!

PDF

Twitter may remove this content at anytime! Save it as PDF for later use!

Try unrolling a thread yourself!

how to unroll video
  1. Follow @ThreadReaderApp to mention us!

  2. From a Twitter thread mention us with a keyword "unroll"
@threadreaderapp unroll

Practice here first or read more on our help page!

More from @TheStalwart

Joe Weisenthal Profile picture
6 Oct
Janet Yellen said this yesterday and now @RussoEcon is also making this point, but tbh I don't get it.

How does the Fed accepting its client, the Treasury, to deposit a coin in its account constitute a loss of its independence nationalreview.com/2021/10/the-th… Image
@RussoEcon Fed independence has typically meant that the FOMC can set rate policy to fight inflation, and choose if it wants to lean against expansionary fiscal policies.

Whether that independence is good or bad, in what sense does accepting a deposit of the coin compromise that?
@RussoEcon A more recent meaning of Fed independence is that it can move very fast on its own (as we saw last March) even as fiscal authorities dither.

That's kind of a different thing. But again, even there, how does the coin compromise that ability?
Read 4 tweets
Joe Weisenthal Profile picture
4 Oct
THE #MINTTHECOIN EPISODE

On the new Odd Lots, @tracyalloway and I speak with @rohangrey, who wrote the definitive legal case for for the legality of the trillion dollar coin.

Astonishingly compelling. Send this to anyone who still isn't coinpilled. bloomberg.com/news/articles/…
@tracyalloway @rohangrey You can read Rohan's full paper here. rohangrey.net/files/coinage.…
And of course, the episode is free on all the apps, including

Apple: podcasts.apple.com/us/podcast/thi…

Spotify: open.spotify.com/episode/5iVgfv…

Etc.
Read 4 tweets
Joe Weisenthal Profile picture
30 Sep
I've been coinpilled since at least 2013.

But after speaking with Rohan I went from thinking "This is kind of a fluke legal technicality" to thinking "This is unambiguously sound, legal, not even a close call, and not even a significant stretching of the law's intent"
I previously thought that the law accidentally worded in such a way as to allow a law on collectibles to enable a trillion dollar coin.

But I no longer think that's the case. It's wording is intentional, and designed to increase potential mint seignorage revenue.
Of course, the designers of the law didn't contemplate it being used as a break-the-glass solution to the debt ceiling.

But the flexibility it affords the Treasury secretary (on coin denomination) is clearly no accident of wording.
Read 5 tweets
Joe Weisenthal Profile picture
22 Sep
I don't even know what people really mean by "Lehman Moment" anymore, but IMO, the greatest sources of market panic/pure fear come when it appears that the mechanics of the government/politics are incapable of doing bailouts/stimulus. (EG the TARP vote.
I don't think China will ever have this exact problem. They may have painful losses, and other calamities. But due to the nature of their system, there probably won't be a period where people wonder if Beijing is capable of bailing out the financial system.
Same with Europe. There were moments in 2011-2013, when it seemed genuinely possible that the nature of the euro area/ECB structure was not mechanically up to the task of stopping an uncontrolled financial panic.
Read 6 tweets
Joe Weisenthal Profile picture
17 Sep
The dots probably served a purpose post-GFC, in hammering home the seriousness with which the Fed meant what it said about staying at ZIRP for a long time.

But in framework where destination is supposed to trump path, they inevitably draw FOMC members back into a path discussion
If I say "I'm not going to raise rates until unemployment is at 3% then that's a destination comment.

But the moment you ask me to make a forecast about *when* unemployment gets to 3%, you're implicitly asking me my growth forecast (path).
We've had years and years of ZIRP, and there's this perception that the Fed likes it this way and hates hiking and all that.

But it's been memoryholed the degree to which post-GFC, the public perception was the exact opposite, that the Fed hated ZIRP and wanted to hike ASAP.
Read 5 tweets
Joe Weisenthal Profile picture
16 Sep
Serious question about blockchain fees. Is there any evidence that any chain has found (or will find) a stable equilibrium such that miners (or validators) are adequately compensated, but the chain doesn't get too expensive, driving users to other chains or other layers?
People like to joke that the goalposts are always moving. That at the end of 2017, the knock on Bitcoin was that the fees were too expensive for anyone to use. And today that's the knock on Ethereum.

But now people point out that Bitcoin's fees are dangerously low?
In theory, Ethereum's fee problem (too expensive) could be solved if everyone uses Layer 2, but then does this pose the risk of fees evaporating on the main chain, creating the same security problem that bitcoin faces today?
Read 4 tweets

Did Thread Reader help you today?

Support us! We are indie developers!

This site is made by just two indie developers on a laptop doing marketing, support and development! Read more about the story.

Become a Premium Member ($3/month or $30/year) and get exclusive features!

Become Premium

Too expensive? Make a small donation by buying us coffee ($5) or help with server cost ($10)

Donate via Paypal Become our Patreon

Thank you for your support!

Follow Us on Twitter!

Like this author's thread?

Get emails when @TheStalwart has new unrolls!

Check out other threads from @TheStalwart!

Read all threads by @TheStalwart

:(