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$1 Trillion Coin Off Table: White House

White House spokesman Jay Carney said on Saturday that the Obama administration would not consider minting the platinum coin worth $1 trillion nominally as a way to bypass the debt-ceiling fight with Republicans in Congress.

Carney, who was quoted by the Associated Press, then said the only two ways forward are for Congress to pay the bills for the spending it authorized or to push the country into a default.

Carney said in a statement that the President and the American people won’t tolerate Congressional Republicans holding the American economy hostage again simply so they can force disastrous cuts to Medicare and other programs the middle class depend on while protecting the wealthy.

While the debt ceiling has been a tool of political debate since August of 2011 when the first showdown between the President and Congress took place, current deadlines have been more of an influence on markets. With a staggering national debt in excess of $16.4 trillion, it is tempting to think a small provision in the U.S. code that allows the Secretary of the Treasury to mint platinum coins with a denomination of his discretion could allow for the debt to be paid down with just 17 coins.

While legally feasible, the coin idea has been lambasted as silly by some members of Congress and many economists. Though possibly preferable to Washington defaulting on the nation’s debt, the likelihood of the coin actually being minted is quite small.

In an era, however, of dubious monetary instruments and paper debt, the coin’s idea is an indication of the move toward honest money in the form of gold and silver bullion. Historically, gold and silver have been used a store of wealth more frequently and with more success than anything else. The rise of current paper trading is largely a development of the past century and digital trading in the modern age has permitted phenomenon such as algorithmic trading which veterans often regard as an extremely negative influence in markets.

Gold and silver prices have performed so well in the past decade that the possibility of a $1 trillion coin is possibly more prescient in the minds of investors and voters watching action on Capital Hill and feeling the financial state of the nation should return to its more fundamental roots.

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