Via Jason Linkins on HuffPo.
Yes, with platinum bullion at $1,587 per ounce you would need almost 20 tons of platinum to have $1 trillion worth. Whether this would sink the RMS Titanic is a moot point, because that ship sank more than 100 years ago. The point is, that’s not how money works. According to a 1996 law, the U.S. Treasury can mint a platinum coin of any denomination.
Yes it’s silly to think of avoiding default with a coin, but it’s even sillier to think that refusing to pay the bills for congressional appropriations might be a good idea (it’s actually unconstitutional).
UPDATE: FDL’s Jon Walker points out that if Congress refuses to raise the debt limit, without the $1 trillion coin the President has to make a choice of which law(s) to break:
The President could ignore just the debt limit law and continue to fulfill all the spending laws. Or, the President could fulfill the debt limit law, but that would require ignoring multiple other laws which would force the President to randomly pick who does and does not get paid.
UPDATE: Paul Krugman: Mint that coin!