Treasury pulls back as U.S. hits debt limit again

[jakeXT]

2. Reminds again of the Grayson idea

So a simple solution to the impasse is as follows: Federal Reserve Chairman Ben Bernanke should simply cancel the Treasury debt that it owns. The government can just forgive the government’s debt.

This wouldn’t solve the debt problem entirely. The Federal Reserve doesn’t own all U.S. government debt; it owns only roughly $2 trillion of it. (Well $2,076,927,000,000.00, as of last Wednesday, but who’s counting?)

Yet canceling this debt would give the government substantial room under the debt ceiling to manage its finances. It would end the debt ceiling standoff in Congress, and it would prevent a default.

http://blogs.reuters.com/great-debate/2013/10/09/ending-the-debt-limit-crisis-dear-ben-bernanke/