Basically, the idea is that the President would order the Fed to mint a platinum coin, load it up with an extraordinary value -- as in, the TRILLIONS of dollars -- and them use it to swap out for Treasury notes of the same value, which would be used to pay off the debt obligations.
The advantage, proponents say, is that it would get around constitutional questions about invoking the 14th Amendment, and that it would protect both the President's and Congress's traditional seperation of powers. Not to mention, it would render both the Tea Partiers/GOP AND the deficit hawk Democrats obsolete.
Here's an article from Joe Firestone over at the Campaign For America's Future, that explains the broad concept:
Beyond The Debt Ceiling: The $30 Trillion Plan For Ending Borrowing And The National Debt (Corrente Blog)<http://www.correntewire.com/beyond_the_debt_ceiling_the_30_trillion_plan_for_ending_borrowing_and_the_national_debt>
And, a further explanation from moi over at my own blog: Proof Platinum Coin Seignoirage: The Ultimate Left Cure For Debtpocalypse? (Inventing The American Left)<http://www.redgarterclub.com/AJK-Multisite/inventingtheamericanleft/2011/07/27/proof-platinum-coin-seigniorage-left-cure-for-debtpocalypse/>
All rightit, LBO'ers...what sayest thou on that??
Anthony