The federal government creates the money either through direct spending by Congress or back stopping money creation by private banks via the reserve system. Money is then destroyed through taxation.
The “debt” is literally the count of untaxed dollars in circulation.
Treasury securities are simply money that they pay interest on.
They create the money. How can they ever run out of money???
The federal government creates the money either through direct spending by Congress or back stopping money creation by private banks via the reserve system. Money is then destroyed through taxation.
The “debt” is literally the count of untaxed dollars in circulation.
Treasury securities are simply money that they pay interest on.
They create the money. How can they ever run out of money???
They don’t run out of money, but they do increase yearly debt payments reducing the overall operating budget for the government.