It's about getting around the debt ceiling, which is a fixed number set by congress and not related to GDP
At the moment the US can afford to take on more borrowing and produce bonds. But congress won't allow it because the tea party lot. This is just a way around a default due to politics not economics.
The fact the reserve doesn't then have to sell bonds for 6 months means banks will possibly buy other assets instead and then it'll trickle down.
(PsychoChomp, Tue 8 Jan 2013, 12:16, 1 reply, 13 years ago)

ah, yeah, I see what you mean.
But presumbaly it could "theoretically" be pulled into the wider economy, in the event of say, a US economic meltdown? because it would be worthless unless that was the case.

So therefore Kroney's got a point below. Also, because economics is basically the science of being a cunt to people, if it could theoretically be dragged into reality becuase of a meltdown, that will be exactly what happens.

See Nothern Rock and "everything will be entirely, exactly fine unless everyone asks for their money right now"

".. Oh"
( the mighty badger Aphrodite, on a bar stool, by your side, Tue 8 Jan 2013, 12:25, Reply)