SamuelRSmith on 08 May 2010
And, yes, I forgot, deficit spending, indeed, all debt spending, requires an increase in the money supply to actually happen.
The Federal Reserve isn't the only body in the USA which can create money, you know. Every single bank in the USA has the ability to create money. When you take out a loan of, say, $20,000 the bank will "create" a large chunk of that money. The difference is that when you take out your loan, or a mortgage for $200,000 the amount of money created is infinitesimal, especially when compared to the amount of money created to fund the trillions required for the Government's debt.
