Si Seniorage

From the “We don’t need no stinking debt ceiling” archives of the Library of Congress, Dave offers the “All Hat ~ No Cattle” approach to monetizing the dollar by backing it with the value of the U.S. Military… also know as “the reset switch.” 

I’m expanding on a topic that I started covering a while back as it relates to the $1 presidential coin act and my suspicions that the $50 buffalo gold coin is at the heart of this.  I got really suspicious last week when a public relations campaign appeared out of nowhere that put a spotlight on the failure of the $1 presidential coins and suggested a repeal of the act due to their failure to gain traction.

The $1 presdential coin act is the same act that created the “divorced” $50 buffalo gold coins that count as both $50 and as $5,000 once the Chinese reset switch is flipped.  Here are background links to the article I am working on.  I didn’t want to wait to get this up because it’s red hot in Washington today in relation to the debt ceiling debate.  Hopefully the full article will be ready in a day or so, but once you read these links, you’ll know exactly where this is headed. 

One of Dave’s most popular articles of all time was the Facebook expose` “Trust and the Trillion Dollar Brain.”  Maybe this article will be titled “Bust and the Trillion Dollar Coin.” 

http://my.firedoglake.com/letsgetitdone/2011/07/07/the-debt-ceiling-is-not-unconstitutional-right-now/

http://www.correntewire.com/holding_debt_ceiling_hostage_no_more_obama_payoff_debt_producing_equal_value_coinsandor_render_ceili

http://my.firedoglake.com/letsgetitdone/2011/07/07/the-debt-ceiling-is-not-unconstitutional-right-now/
 
http://www.dailykos.com/story/2011/06/27/989304/-How-to-Knock-Two-Trillion-Dollars-Off-the-National-Debt,-Ending-the-Debt-Limit-Crisis#comments
 

http://finance.fortune.cnn.com/2011/07/06/geithner-the-debt-ceiling-and-the-14th-amendment/

According to HuffPo’s Washington editor, there is no “Plan B” at the White House , but there is a “Plan A.” I would suggest referring to Plan A as “the plan” rather than referring to it as “Plan A” if there is indeed no “Plan B.” Keep in mind that it was Al Gore who was in the White House as Vice President when the $1 presidential coin act was written into law.

Previous blog posts on TradeWithDave.com that relate to this issue:

http://tradewithdave.com/?p=6640

http://tradewithdave.com/?p=6916

http://tradewithdave.com/?p=6999

One Response to “Si Seniorage”

  1. [...] Here’s the first time Dave wrote on this subject nine month’s ago and Dave’s suspicions that something was up with the Presidential Coin Act and the Gold Buffalo Coin.  It has always bothered Dave that the $50 gold Buffalo coin says “1 oz. gold and $50″ both printed on the coin.  Dave has figured that the Fed could be allowed to account for all of its gold as it the gold had been minted into these $50 gold coins.  The seniorage that is created in this model is approximately $1,500 per ounce times 7,000 tons in the New York Fed alone:  http://tradewithdave.com/?p=7228   [...]