Quote from: atoni on August 05, 2014, 06:33:09 PM

You do realize that someone is buying those bonds? Its people with money that buy them. Same as with banks. People with money deposit and banks loans them to those that need it.

- Gov prints up a bond

- shell game (open market operations)

- sends it to the Fed -

- the Fed "monetizes it" i.e (calls it a Debt)

- Send it back to the Gov as "Federal reserve notes" ( which bear debt interest)

- the Treasury does the printing and accounting. (is the secretary in effect)

^^^^

what don't you understand?

in the private sector as that flows down- banks take deposit as a "reserve ratio" then lend new money on that ratio as "credit creation" this can be deposited as money and serve as new "reserves".

^^^^^

coloured balls?