[NovemberWhiskey]

So, in your mind, when the Federal Reserve prints a dollar bill - what's happening in accounting terms? I don't think your understanding of the way this works is consistent with the concept of money supply.

[tharkun__]

Not your parent but in my mind, when the Fed prints $1 million to replace old bills they take out of circulation and give then to people to stuff into a cube then in accounting terms basically nothing happens at all.

[smj-edison]

To be precise, the treasury prints the bills, not the federal reserve. The federal reserve balances what money is in circulation by selling or buying bonds. When they issue a bond, someone buys it, so money is removed from circulation. When they buy a bond, money is injected into circulation.

[lxgr]

It’s the other way around. The treasury issues bonds; the Fed buys (or repos) them in exchange for newly issued USD.