QE3, Treasury Style - Go Around, Not Over the Debt Ceiling Limit

4 Pages Posted: 10 Jul 2011

See all articles by Scott T. Fullwiler

Scott T. Fullwiler

Wartburg College; Bard College - The Levy Economics Institute

Date Written: July 9, 2011

Abstract

The debt ceiling debate could be ended right now given that the US Constitution bestows upon the US Treasury the authority to mint coins. Further, this simple change would lift the veil on how current monetary operations work and thereby demonstrate clearly that a currency-issuing government under flexible exchange rates cannot be forced into default against its will and is not beholden to “vigilante” bond markets. This paper provides a description of how the process would work and the implications for monetary operations.

Keywords: debt ceiling, Treasury, monetary operations, Federal Reserve, quantitative easing, deficits, national debt

JEL Classification: E42, E43, E51, E52, E58, E62

Suggested Citation

Fullwiler, Scott T., QE3, Treasury Style - Go Around, Not Over the Debt Ceiling Limit (July 9, 2011). Available at SSRN: https://ssrn.com/abstract=1883083 or http://dx.doi.org/10.2139/ssrn.1883083

Scott T. Fullwiler (Contact Author)

Wartburg College ( email )

222 Ninth St. NW
Waverly, IA 50677
United States

Bard College - The Levy Economics Institute ( email )

Blithewood
Annandale-on-Hudson, NY 12504-5000
United States

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