In logic there is little difference between coins and paper money. But in most countries the accounting convention is that paper issued by government is treated as a continuing liability of the government but the issue of coins is treated as a sale by government. Hence outstanding paper is a 'debt' but coins generate government revenue.
Some years back the Australian government quietly helped its apparent budget deficit by calling in one and two dollar notes and selling the equivalent in coins. A few of us joked at the time that the government could completely solve the deficit by stamping $5 billion on a rubbish bin lid and selling it to the Reserve Bank of Australia. Of course anything else Obama sells to Bernanke would work, for example, you could sell the rights to collect future income tax. _____ From: [email protected] [mailto:[email protected]] On Behalf Of Jeffrey Fisher Sent: Sunday, 31 July 2011 8:26 AM To: Progressive Economics Subject: Re: [Pen-l] a solution i thought the law does distinguish between paper money and coins, and that's why the coin. On Sat, Jul 30, 2011 at 5:19 PM, socialismorbarbarism <[email protected]> wrote: Yes, yes, I get all that. What I don't understand is: Why a *coin*? Why, in the absence of a law specifically banning the issuance of paper, is this necessary? Why not paper?
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