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2006-10-17 14:41:05 · 5 answers · asked by Anonymous in Education & Reference Homework Help

5 answers

Here's your real answer. They don't print it. That's just called increasing the real money supply, which typically drives inflation.

They sell treasury bills and treasury bonds in the bond market. The gov't basically holds an auction saying that they want to raise a certain amount of money. Large banks and financial institutions place bids on how much and at what rate they want to buy. They gov't will sell the bonds at a rate so that they raise as many funds as needed. (And yes, this also tends to drive inflation, but takes longer and is also based on the federal budget deficit, the amount of outstanding debt, etc.)

Yes, they also have savings bonds, but it's a small amount compared to T-bills and T-bonds. They also do inflation-indexed bonds, but those are a subset of T-bonds.

2006-10-17 15:07:38 · answer #1 · answered by c 3 · 0 0

From the US people, from banks, from foreign governments - all by selling Treasury Bills, (usually called T-bills) and Savings Bonds.

2006-10-17 21:43:59 · answer #2 · answered by Ralfcoder 7 · 0 0

This is not a math question. This question belongs in the social studies category.

Guido

2006-10-17 21:44:53 · answer #3 · answered by Anonymous · 0 0

They dont borro money. They just make more

2006-10-17 21:42:50 · answer #4 · answered by Anonymous · 0 0

government bonds

2006-10-17 21:42:54 · answer #5 · answered by Poncho Rio 4 · 0 0

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