The government lowers interest rates to increase economic growth and when the inflation is low. Lending increases the money supply because banks are not required to have full reserves. So yes, the Fed actually increases the effective money supply at the correct rate depending on whether they want the economy to grow or to control inflation
The government lowers interest rates to increase economic growth and when the inflation is low. Lending increases the money supply because banks are not required to have full reserves. So yes, the Fed actually increases the effective money supply at the correct rate depending on whether they want the economy to grow or to control inflation
The supply in circulation. Bonds are promissory notes. I don’t think the money disappears from ledgers.
The fractional reserve is fixed AFAIK.