The federal budget is paid for by tax dollars (2/3) and everything else (1/3). But taxes this year will account for much less. A portion is paid for by money outside of taxes i.e. Treasury bonds, which contributes to the National debt. The Federal Reserve's activities are not part of the national debt [!] The Federal Reserve is not officially a part of the government. Theoretically the reason for this is to make sure government cannot print money directly to pay its own bills. The Fed is supposed to act independently and not print money unless it is in the interest of the economy. In spite of this the Federal Reserve tends to print all the money the government asks for regardless of the effect it may have on the economy [Amazing]
Thursday, September 1, 2011
Video: US Currency Collapse, Role of Gov't and Fed Printing
From the YouTube description:
Posted by Bob Reno at 7:23 AM
Breaking US Dollar Collapse News
What's Behind the Decline of the US Dollar?
This is one the of the best and simplest explanations we have seen:
The U.S. dollar's downward slide is accelerating as low interest rates, inflation concerns and the massive federal budget deficit undermine the currency. - Wall Street Journal, April 23, 2011Interestingly, the Federal Reserve is responsible for, or an active participant in all three of these factors.