Professor Steve Keen: This Is How The Government Prints Money
Market Depth
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Do We Really Need to Buy Bonds?
When banks buy bonds, also they're not doing anything because they're taking the newly created reserves by the fiscal spending in the first place. In that case, us, the public sector, we get an injection of net worth and we have to do nothing. We don't have the liability attached to that. And I think, correct me if I'm wrong, when the private sector, us need to buy the bonds of government is issuing, that's probably the only case when government deficit spending doesn't create immediately spendable money for the private sector.
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