So, I know that debt in general is a good thing for a country to have, but I’ve also heard that the U.S. sometimes makes money off of its debt. How does it do this?
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Under the federal reserve system – every dollar that exists is a dollar of debt. When the government “borrows” money, this means that more money is literally made at a printing press. These extra dollars increase the money supply by multiples and cause inflation.
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