A platinum opportunity?

I’m late to the party on this one, but here’s a novel way to increase the money supply and government revenues: Have the Treasury issue platinum coins of huge denominations. (The usual way of increasing the money supply through Fed actions hasn’t been working so well lately — the Fed has created hundreds of billions in bank reserves, but the banks haven’t been loaning them out and so they haven’t been converted into money.) Brad DeLong:

‘[The Treasury should mint] 100,000 of them, worth $10 million each. Billionaires will want to hold some to be cool. Multi-millionaires will want to hold some so that people think that they are billionaires. Use the proceeds to buy back a lot of long-term debt: that’s $1 trillion of quantitative easing by the Treasury right there.’

Yale Law Professor Jack Balkin appears to have gotten the platinum ball rolling. Paul Krugman is intrigued. So is Matt Yglesias. I still need some time to think it over.

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