[quote pjwal]
The Fed never “prints” money, the US government sells bonds and that is only cheap in the context of the present.
[/quote]
Actually it does print money. The only problem is that it is highly inflationary when it increases M0.
M0 = Notes and coins in circulation + Notes and coins in bank vaults.
What makes the difference between something like a gold currency standard and a fiat currency standard, is that on a fiat currency standard, more ‘currency’ can be created at will by the government.
The selling of bonds does not increase the money supply. Someone gave up currency to buy the bond (exchanged money for a bond/IOU). The net is 0.
–sorry Nor-LA-SD-guy, I didn’t see you get in there…
