I did check the law. I also read your link. I remind you that Sovereigns have the right to print money. There is no international law that says it must issue debt. if they spend more than they take in. The onus would seem to be on you to show a law that the Treasury and private bank arrangement we have would be constrained by some law saying they can not simply spend (print money without issuing bonds or treasuries) . Neither you nor any one on any of the sites I have checked have produced such a limiting law. So at best this would be a case of first impression for the Supreme Court. Again, if you produce such a law, I will stand corrected. -- I know that would produce inflation. Its is not want I want. I want the Rs to get us to a balanced budget through cuts. I also would like to see the Fed and its banker owners force their Democrat politicians to cut the spending... 2% a year til we balance. Alternatively, I would cease personal income tax, create a flat international tax on corps doing business here (cause they are all leaving) and I would cap spending and stop borrowing for 10 to 15 years or until we got a reset with a balanced budget for a few years. Until we get back to a balanced budget.
I dissagree that the onus is on me to show a negative. The law specifies how the Fed can issue notes and to whom. As the statute is silent on the method of issuance that you suggest, it stands to reason that this is NOT permissable. http://www.federalreserve.gov/aboutthefed/section16.htm
now we are having a discussion. a. so the question becomes does the fed limit its activities to what is described above? I see nothing about lending money to foreign banks like it did during the financial crisis. During the financial crisis I believe the fed created trillions of dollars some of it for foreign banks. so the Fed does not see itself as constrained to do only what is explicitly authorized. Besides as a private bank it would be free to do anything which is not against the law. here is an interesting article... does the fed create money... http://www.forbes.com/sites/michaelpento/2010/11/22/does-the-fed-create-money/
I don't see any credentials for the author of that article and see at least a couple of his statements that I know are not correct. But, there are so many laymen who don't fully understand the Fed trying to explain it's actions. Both you and I are in that category. The only place you can turn is to the law and I don't have a desire at this time to completely immerse myself into learning all of the ins and outs of the Federal Reserve. I know the basics and what they are supposed to do and that's all that interest me. As far as the Fed funding the foreign banks, I seem to recall that the Fed did that through normal operations with the foreign bank's U.S. branches which fell within the Fed's legal actions. And, as far as "now we are having a discussion", ummm no. I already know all I want to know about the Fed and if you want to believe the Fed can do this or that, that's fine with me. Soldier on, jem, but I have no desire to start chasing my tail in a circle with you for a few hundred posts and hours of research or BS. I hand you the last word(s), post(s) or what ever.
In short you are saying the Fed can't do something but you don't wish to spend the timing supporting your statement. I am saying the Fed already cashes Treasury checks. So why would they stop just because the Treasury did not issue bonds. That would be up to the Fed. And that there is no answer to this question because it would be a case of first impression for the courts. I have done the research on this topic and a few other lawyers some who seem to experts in the area have said the same thing. Frankly I am not sure how my position could be anything but correct unless you were to show a statute limiting the Fed power to cash govt checks. That author was printed in Forbes and Forbes has credentials. We are not trying to explain the feds actions we are simply attempting to read a statute and find out if it proscribes a particularly activity. It does not take a Fed expert to figure that out.