“So the inflation is two-fold. Firstly, the Fed pushes new reserves into the system via the OMOs in order to try to bring the FFR down. Secondly the commercial banks pyramid loans on the basis of those reserves. So normally if the Fed increases the monetary base (not typically notes and coins but more commonly by increasing the total quantity of reserves in the system held on account with the Fed itself) by 100 billion you might expect an actual expansion of the overall money supply of maybe 1 trillion (in a very simple example).”
this was told to me here https://forum.freecapitalists.org/t/the-actual-procedure-of-creating-money-alt-thread/5380
“You need the Fed to then create money out of thin air, buy assets form banks, to give banks more dollar reserves by which banks can pyramid / leverage / expand more credit (create money) from. Inflation is therefore created and perpetuated by the Fed.”
this was told to me here https://forum.freecapitalists.org/t/seemingly-different-statements-about-federal-reserve-inflation/5402
as i understand these explanations, outside of government currency and coin production inflation is a also a Federal reserve dollar-credit increase phenomenon that is further inflated via fractional reserve commercial banking (pyramiding)…i____f this is true at all.
additionally, this post "F__ED just electronically increase the balance of bank account that sold security to FED. New money, out of nothing.__ FED also takes ownership of the security. That’s it.
"Now, banks have new money that they can lend if they wish so. But banks don’t want to lend and leave that money alone. That money has potential to enter economy. But until banks actually extend credit to people or companies, it will not create inflation."
"https://forum.freecapitalists.org/t/the-actual-procedure-of-creating-money-alt-thread/5380/19
i guess it takes awille for 100 billion dollars to trillion-ize its way through the economy and even longer for the trillion+ to get paid back (the money destruction part?). in the meantime i guess the federal reserve keeps on doing what it does in concert with fractional reserve banking practices in an overall inflationary manner.
www.economagic.com displays an m1 money chart - year 1959 140 billion dollars ; year 2009 ~1600 billion dollars.
i have read that the m1 includes currency and coin, bank reserves at the federal reserve and a few types of demand accounts at commercial banks.