Financial innovation hasn’t stopped, it’s just being done by the government

The Federal Reserve explored the idea
of issuing its own debt in discussions with Congress as the
central bank sought ways of coping with a balance sheet that has
more than doubled in the past year.

Here is much more.  I don’t think this is intended as an application of Neil Wallace’s legal restrictions theory of money.  Rather the goal is to give the Fed a new funding option at a time when excess reserves are not always a desirable means of balance sheet expansion.

I wonder if such securities would trade at a discount or premium to Treasury securities or if it’s even a good idea to find out.

I too would like the ability to borrow large sums at a zero rate of interest, which right now I can do only from Natasha.  But you know, it’s funny: if I had the right to print my own money, I’d actually be plenty happy with that.  I guess not everyone is so easily satisfied.


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