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View Diary: Can a Small California City Take on Wall Street - And Survive? (298 comments)

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  • (1+ / 0-)
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    the Fed prints the money.  The Treasury was relieved of that responsibility in 1913.

    You need to educate yourself about petrodollars.

    spread the knowledge

    •  Actually, the Bureau of Engraving and Printing (3+ / 0-)
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      Chi, vahana, jpmassar

      produces tangible currency and distributes it mostly to replace the old and as ordered up by the banks. However, according to several recent heads of the Fed, the Fed orders up dollars from the Treasury and the Treasury credits the Fed account electronically. Whereas a paper bill, regardless of the denomination, costs seven cents to produce, the dollars distributed electronically are cost free. If the Fed charges member banks .025% that's to cover handling and processing and accounting costs. Which is as it ought to be, since dollars are now costless as well as worthless unless spent--i.e. taken in exchange for some good or service.

      That Wall Street plays with dollars as if they had intrinsic value does not mean that they do. It means that some of our Wall Street mavens deal with dollars like pornographers approaching sex.

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