No, that’s not a joke. The monetization efforts by Ben Benanke and the Federal Reserve have resulted in the United States taxpayer edging out China as the largest holders of our own debt.
So how exactly can our country be indebted to itself? Easy. Our country prints more of its own currency, and then loans that currency to itself. This would be the equivalent of you creating your own currency, printing up batches of that currency and then loaning it to yourself to pay your bills.
We, as individuals, can’t do that because it’s an absurd concept. The government, however, can do it because they’re the government and can print all the money they want. Which is why our money supply shouldn’t be controlled by the government.
Sources:
