“The nuclear option is to print money by issuing Special Drawing Rights, in effect acting as if it were the world’s central bank. This was done briefly after the fall of the Soviet Union but has never been used as systematic tool of policy to head off a global financial crisis.”
As I understand it SDRs (Special Drawing rights) is a basket of currencies. I’m curious as to how the IMF would go about “printing” SDRs. Would each central bank whose currency is represented in the basket just print money and give it to the IMF? If anybody can enlighten me as to how the IMF would go about inflating, the similarities and/or differences between how it would do it and how the Fed does it, etc. it would be greatly appreciated. Thanks in advance.
In liberty,
Chris