Do governments sell bonds in order to gain money or do they get money from banks instantly and pay off the debt with the money they get from bonds?
different ways the gov gets money to spend:it can create new money (inflationary)it can also tax existing money from its citizens (neutral)it can borrow money via a bond (neutral/inflationary)borrowing money is neutral. servicing interest payments or buying back bonds could be neutral but in practice tends to be inflationary (quantitative easing)my understanding of this is medium level>captcha M2 money supply
>>60931530>Do governments sell bonds in order to gain money or do they get money from banks instantly and pay off the debt with the money they get from bonds?Brother it's all fake Jewish number magic. The government can literally print money to sell bonds to itself to get money if it's truly desperate. See COVID-19 for more info on this simple trick.
>>60932316>The government can literally print money to sell bonds to itself to get money if it's truly desperate.if the gov needs money it can short circuit this process and just create it. they literally change a number on a spreadsheet or database. musk identified a few different computers that are capable of this.(i don't doubt however that they've sold bonds to themselves at one point or another for convoluted reasons)buying back bonds with newly created money is something they've done. in this case it's more effective than showering the money....wherever it goes.....because they eliminate future interest payments at the same timethere must be some large inefficiencies in this process because other anons have pointed out calculations of the money supply have a sizeable component that cancels> Brother it's all fake Jewish number magic. seigniorage i don't think is inherently jewish (it can be) but there are definitely a large number of jewish parasites attached at the source. newly created money has to be given to someone for some reason and one of the primary beneficiaries is banksi'm still learning about all this> t. medium tier knowledge anon
You will get lots of bad answers. Modern money creation in the west happens essentially by private banks, who leverage their balance sheet to create credits and debits and are constrained mainly by CREDIT RATING in this lending process, as high credit rating assets (almost universally domestic government assets) can be used as RESERVES given they are HIGH QUALITY ASSETS, which is generally further defined in Basel which most G20 nations are members of and have integrated into their monetary system, for example in the U.S. the federal reserve sub branch (I think it is) is the Office of the comptroller of the currency, who is in charge of ensuring bank balance sheets meet reserve requirements by calculating their ratio of lending to aforementioned reserves, which are really just high quality assets that meet government/Basel requirements. So really when get down into the nitty gritty of it, when a country sells bonds it is going out into the open market, letting market participants decide the credit worthiness of the government trying to sell said bond, and if said government is deemed to have a high ability to repay said bonds, it will leverage against the existing bonds it owns to lend the government money in exchange for more bonds. Sometimes it will leverage those bonds to extend credit to private entities at higher rates. Further boiled down the real lynchpin in this process is demand for a currency, a currency with falling demand and high debt behind it would be expected to inflate, raising its interest cost, and making it harder for the government to repay said debt without further inflation, reducing demand for the currency further. And of course the currency strength itself is largely an interplay between the growth of a nation, what investments has it made in growing demand for its currency with other governments and entities based on its past issuances (what’s the future outlook for the currency), and what’s the current rate/cost to borrow/obtain
Bumping
>>60931530They have a few different tricks that are just lending which in theory get unwound at some point, and it's an open secret they also literally print and prop up securities.
The government prints money out of thin air and sells bonds to finance it. None of this is backed by anything whatsoever beyond your trust and faith in government. Then they’ll tell you bitcoin is internet funny money with a straight face.
