Quote:
Originally Posted by mykalberta
I am in firm belief that the US is printing money and applying that to the debt
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I believe this statement is incorrect. When the US government issues new debt it sells bonds, in exchange for bonds they get dollars. These dollars are then used to pay expenditures.
Monetary flow (how many physical dollars floating around) is completely different and is actually controlled by the Federal Reserve, the Fed prints dollars and buys the US debt (to inject more physical money) into the system, or sells debt that it holds on its balance sheet (to reduce the physical flow of money). This is how it controls inflation.
This is my understanding, someone can correct me if I am wrong
