It has undeniable parallels to the 1923 coal crisis of Germany. They minted money to pay the coal miners. The German Mark devalued so much that a loaf of bread costed 460 BILLION Marks :). Hopefully , commonsense will prevail this time around.
The idea was a joke, whether or not it was so intended.<br />
Precious metals have an intrinsic value ba<x>sed on the demand for the metal and the limited supply. Platinum certainly has a relatively high intrinsic value per ounce. Although platinum has a far higher intrinsic value than does paper, paper does have an intrinsic value. Just find yourself in a bathroom without toilet paper, after you have defecated. The monetary value of a coin or a bill can be established in several ways. Most currencies are valued in relation to the US Dollar or the Euro. Some nations declare the value of their currency while others allow that value to float. When a nation applies a fixed value that is arbitrary and unsupported, the currency inflates. Inflation can take place with dollar bills or Trillion dollar coins. The real value is dependent on what someone else would be willing to pay to purchase the coin. Who, if anyone, would be willing to purchase a Trillion dollar coin using a trillion dollars worth of gold, oil, Euros, or any other item of value? If no one is willing to buy it, it loses value until that value reaches a number at which someone will buy it.<br />
In the 1970s, the value of gold was rapidly rising and with it, the value of many currencies made from gold. For example the Danish Kronar. Mexico at the time had a 50 peso solid gold coin. Wishing to take advantage of the rapid escalation of gold prices and the demand that caused for anything made from gold, Mexico rapidly began to mint Mexican 50 peso gold coins and sell them. I made the mistake of buying these coins. While the price of gold approximately doubles, the because too many coins were minted, the currency value of the 50 peso gold coins collapsed by half. Instead of doubling my investment, the two factors counterbalanced each other and the total value essentially stayed the same. When I figured in margin costs and storage fees, I lost money.<br />
Yes, Krugman's idea was a joke whether intended or not.
Mr O wisely disassociated himself from that idea. Enough of us already think of him as having imperial ambitions that, if he openly showed any, he could cripple his position.<br />
Anytime you have people advocating a giant circumvention of the law, or even a quasi-run-around, is a time to fear. The idea of separating the treasury from the oversight of the houses of congress is a thing to fear. Then the people will no longer have control over their government's executive.