the concept of the Fed issuing its own debt would be struck down by the supreme court. Our constitution protects us against taxation without representation.
Very interesting points. So if the Fed issues bonds so they don't have to print money they will pay them off at a later date with printed money? So, essentially, the Fed is deferring money printing? There is no way they are going to sell this. The Fed is out of control.
You need to educate yourself on how the banking & financial systems of the world work. Whatever money the Fed borrows will be then multiplied via fractional reserve banking.
The Fed will issue this debt against their ability to create money. The debt will eventually be payed off with newly created funds which means that inflation is inevitable. The basic idea behind this plan is to give the Federal Reserve a tool to spread out inflation more evenly. Since new money won't be created untill the debt is redeemed they can spread out inflationary pressure across a redemption time frame.
Very interesting points. So if the Fed issues bonds so they don't have to print money they will pay them off at a later date with printed money? So, essentially, the Fed is deferring money printing? There is no way they are going to sell this. The Fed is out of control. Didn't I just post that?
Wouldn't these Fed notes compete directly with the tsunami of Treasury notes, thereby pushing upwards on interest rates for both parties?
Yeah, it is amazing that there is demand for the Treasury's notes at these rates to begin with. This whole money printing event can't end without repurcussions...can it?
No, that's why they created the SFP. I'm pretty sure almost all buying is done by the FED. This is the 2007 treasury ownership chart: http://upload.wikimedia.org/wikiped...hip_of_US_Treasury_securities_by_category.gif You can pretty much guess how the december 2008 chart is going to look Yep, that's indeed one of the big problems it creates.