Which banks have access to the FED discount window & how does the FED determine how much "free money" they can take? With the discount rate @0% banks can theoretically take as much free money ( ie FED money created out of nothing ) as the FED allows & just park it in treasuries & pocket the interest. I cant get a grip on how the FED can create trillions of dollars out of thin air & not debase the dollar? When the FED talks about inflating its balance sheet by buying assets doesnt that mean they create money out of thin air to purchase these assets? When the FED is done buying trillions in assets wont that = FED now has trillions of assets for free & bagholders ( taxpayers ) are paying for their spending spree through inflation??
Banks need call in loan first to shore up balance sheet before fed can loan them more money. But they can't, so they use bad loans to swap for fed's new cash. And Fed is doing it on slow motions (Fed calls it deflation). Therefore this process called forced-liquidations. Bad company focus on get new loans or bail out, most likely be forced to liquidate later. Good companies shore up cash flow and getting ready to buy assets.